IRD promises leniency on late GST penalties following technical foulup

IRD commissioner Naomi Ferguson says no penalties will be applied if people file before July 4.

Inland Revenue promises to be lenient on those hit by its technical foulups.

"We will not apply late filing and late payment penalties for any GST returns due on June 28 if they are filed and payments made by Wednesday, July 4," IRD commissioner Naomi Ferguson says in a statement issued at 12.15pm today.

The clarification comes after criticism from Chartered Accountants Australia and New Zealand earlier today, with the organisation's tax leader, John Cuthbertson, complaining IRD had not made the penalty situation clear. A late monthly filing ordinarily attracts a $250 penalty.

The past fortnight has seen complaints from tax agents and individuals trying to file GST returns online before the June 28 deadline. Those who tried to complain by phone found the helpdesk overloaded.

Some could not log on to the new MyIR system; others found it very slow; some got partway through a filing only for the system to freeze on them.

Yesterday, the IRD said it had tracked down the problem to a load balancer (which helps manage traffic to a web server at peak times). A fix was instituted late morning on Tuesday. Indications are that most people are now getting through.

“Problems with Inland Revenue’s GST processing system over the past couple of weeks have been largely resolved," Ms Ferguson says.

“I offer my apologies to our customers for the frustrations this has caused, and reiterate our undertaking to be reasonable if any customer has had difficulty meeting the filing date deadline of today because of issues with the online service."

The IRD has refused to front anyone for an interview but says Ms Ferguson may be available next week.

"Really broken"
Today, via social media, a number of small businesspeople and sole traders told NBR that flings had gone okay.

Others were still stewing from bad experiences earlier in the week.

"I got mine filed on Tuesday – on the third try. The process has been really broken for at least 10 days. It worked fine in April," real estate agent Alistair Helm said.

"We had a nightmare earlier in the week. The site is a shambles," small business owner Vaughn Davis. said

A staff member at a large accounting firm told NBR yesterday, as the agency grappled with its fix, "The new system they’ve rolled out hasn’t been able to perform the functions it was rolled out for. Sometimes it displays weird script because it’s just not running properly. And, presumably as a result of the online issues, their call centre can be extremely difficult to get through to."

Freelance digital consultant Richard Ram, who still had issues shortly after the IRD's fix on Tuesday, says the system now seems to be behaving.

Freelancer Bill Bennett was waiting until tonight – the last possible moment – to file his GST return. In this instance, it will be a case of a journalist wisely waiting until the last minute to hit a deadline.

The IRD is currently in the middle of a $1.7b overhaul of its systems that has drawn fire from some in the local IT industry for its reliance largely on multinational suppliers, flak from the Public Service Association over attendant layoffs, and criticism from the auditor-general over lax procurement.


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8 Comments & Questions

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Can companies charge IRD a $250 penalty for refunds processed late?

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Not to mention the millions of unpaid hours that it takes to work it all out.

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Seems MyIR website is not working again today.

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Leader on the IRD BT project, Greg James, is bringing the Fonterra magic to the biggest software failure in NZ history:

1) Record pay to him and his ex-Fonterra cronies
2) Corrupt foreign shell company (Fast NZ) gets huge profits
3) Kiwi taxpayer foots the bill

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Better performance on Microsoft Edge than Chrome incidentally.

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For $5K NZD you can buy a web application that will work on different browsers. This would be utterly disgraceful incompetence for $1 Million - but no, $1.7 Billion to foreigners who don't care about NZ. This Gentax system only cost Finland $300 Million Euros - why are we paying over 5 times that? Also heard that Fast Enterprises have made sure no IRD workers can configure changes - we'll be paying SaaS rental fees to them forever. And that's before Trump decides to include software companies in his trade war!

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Remember, the last actual price we had for the IRD "upgrade" was $2.61 Billion, and that was in 2016 (as reported by NBR - https://www.nbr.co.nz/article/ird-business-transformation-project-cost-2... - ironically on the same day that project lead Greg James assured the crowd at ITx that the project was ahead of schedule and *under budget*. Yes. Oblivious or incompetent. Pick one). Yes, nearly $1 billion over budget, and I can't imagine that the overrun been clawed back in the meantime. The incompetence underlying the whole process is simply staggering.

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The IRD workers themselves are saying the software doesn't even compute penalties and interest properly and the system is full of errors they can't fix. IRD needed to revert to the mainframe after the new system started malfunctioning. And that was the easy tax types like GST. With all the complexity in income tax and social policy the budget will explode. Everything has to squeeze into the "McGentax" framework or it's more extra costs for "customisation." We need a ministerial review ASAP - if Stuart Nash lets this slide on he'll be held responsible.

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