Tax Refunds 2025: Are You Owed Money by the IRD?
Every year, thousands of Kiwis receive a welcome surprise from Inland Revenue: a tax refund. For the 2025 tax year, IRD has started processing income tax assessments and paying out refunds to eligible individuals. If you’re wondering whether you’ll be getting a refund—or a bill—here’s what you need to know.
How IRD Determines Your Tax Position
From 1 April to 31 March each year, Inland Revenue collects information about your income from employers, banks, and investment providers. If they have all your income details, they automatically assess your tax position for the year. This assessment shows one of three outcomes:
You’re due a refund
You’ve paid the right amount
You owe tax
If a refund is due, IRD will pay it directly into the bank account they have on file for you. While not everyone gets their money on the same day, most refunds are deposited within a few days of processing.
Want Your Refund Faster?
To ensure a smooth process and avoid delays:
Update your bank account details on the IRD website or myIR.
Keep your contact information current, so you don’t miss any important notifications.
If IRD doesn’t have your bank details or there's an issue with your bank receiving the payment, the money will bounce back to IRD—delaying your refund. Taking five minutes now to check your details could save you days of waiting later.
What If You Owe Tax?
Not all assessments come with good news. Some taxpayers may find they owe tax for the 2025 financial year. This might come as a surprise, especially if you assumed tax was being deducted correctly throughout the year.
You might owe tax if:
You changed jobs or had multiple income sources during the year
Some of your income wasn’t taxed correctly
Your investment tax rate changed midway through the year
You received employer share benefits that weren’t taxed
You claimed the independent earner tax credit but your income ended up over the threshold
Your schedular payments (e.g., contractor income) were taxed at a lower rate than needed
Tax thresholds changed and your income increased later in the year
If you do owe tax, the due date for most taxpayers to make payment is 7 February 2026. It’s important not to ignore these letters from IRD—penalties and interest can apply to late payments.
Stay Informed, Stay Ahead
Tax time doesn’t have to be stressful. By understanding how the system works and taking a few proactive steps, you can avoid unpleasant surprises and make sure you’re getting what you’re owed.
If you’re unsure about your tax position, or need help interpreting your IRD assessment, talk to a tax advisor. At Tax Professionals, we help individuals and businesses make sense of their tax obligations and keep more of their hard-earned money.
📞 Call us on 09 625 0035 or visit www.taxprofessionals.co.nz to book a consultation.