Most PAYE employees in New Zealand do not need to file a tax return. Instead, IRD issues an automatic tax assessment each year — a pre-calculated tax summary based on your employer’s payroll data and other information IRD holds. Here is what to expect and how to respond.
Between May and July, IRD sends an automatic tax assessment to most PAYE earners covering the previous tax year (1 April – 31 March). Review it in myIR — if it looks correct, confirm it or let it auto-confirm. If you are owed a refund, IRD deposits it to your bank account. If you underpaid tax, you pay the shortfall. If your circumstances are more complex (rental income, self-employment, overseas income), you may need to file an IR3 instead.
What Is an Automatic Tax Assessment?
An automatic tax assessment is IRD’s calculation of your income tax for the tax year (1 April – 31 March). It is issued to New Zealanders whose tax can be reasonably determined from data IRD already holds.
IRD uses information from:
- Your employer’s payroll filings (employment income, PAYE withheld)
- KiwiSaver records (for certain credits)
- Investment income (dividends, interest — from PIEs and banks)
- Student loan repayments
- Working for Families calculations
- Prior-year information
Timeline
| Date | What happens |
|---|---|
| 1 April | New tax year begins |
| 31 March | Tax year ends |
| May–July | IRD sends assessments for the prior year |
| Deadline (usually ~8 weeks from issue) | You confirm, dispute, or let it auto-confirm |
| After confirmation | Refund paid (if owed) or bill issued (if underpaid) |
What the Assessment Shows
When you open your assessment in myIR, you see:
- All income sources IRD is aware of (salary, wages, interest, dividends)
- Total tax withheld (PAYE)
- Any tax credits applied (IETC, imputation credits)
- Calculated tax liability
- Outcome: refund or amount to pay
When to Accept the Assessment
Accept (confirm) the assessment if:
- All your income sources are correctly listed
- You had no additional income (rental, freelance, overseas)
- You have no extra deductions to claim
- You do not want to add any credits (e.g., charitable donation tax credits)
You can either click Confirm in myIR or simply do nothing — assessments auto-confirm after the deadline.
When to Update or Dispute the Assessment
Update the assessment if:
- Income is missing (e.g., a second job, interest income, rental income)
- Income is overstated (e.g., an employer reported incorrect figures)
- You want to claim additional deductions or credits (e.g., charitable donations, IETC you missed during the year)
- You received income from overseas
You can update directly in myIR. Click I want to update this assessment and add or correct details.
When You Must File an IR3 Instead
An automatic assessment is not issued if IRD determines you have complex tax affairs. You must file an IR3 if you have:
- Self-employment or business income
- Rental income from a property you own
- Overseas income
- Income from a trust
- Any year where you were not a NZ tax resident for the full year
IRD may contact you to request an IR3. If you know you have complex income, do not wait — file your IR3 proactively before 7 July.
Outcomes: Refund or Amount to Pay
If you are owed a refund: IRD deposits the refund to your bank account registered in myIR (generally within 2 weeks of confirmation). Ensure your bank account details are correct in myIR before the assessment season.
If you owe tax: IRD will issue a bill. You have until the due date to pay (shown on the assessment). Pay via myIR, bank transfer, or credit card.
Charitable Donation Tax Credits
If you made charitable donations to approved organisations, you can claim a 33.33% tax credit on total donations over $5:
- Claim in your assessment via myIR (or in your IR3)
- Attach donation receipts from donee organisations
- A donation of $300 returns a $100 tax credit
This is one of the most commonly missed credits in NZ — if you donated to charities during the year, claim it.
Frequently Asked Questions
I did not receive an assessment. What do I do?
Not all individuals receive an automatic assessment. If you had only PAYE income with the correct tax codes, your PAYE may be considered square (no refund, no underpayment) and an assessment is not always issued. Log in to myIR and check under Income tax → Tax assessments to see if one is available.
My assessment shows income I did not earn. What do I do?
Dispute it in myIR by clicking Update this assessment. Remove or correct the incorrect income. If it appears to be a system error or comes from unknown employers, contact IRD directly.
Can I file an IR3 even if I received an automatic assessment?
Yes — if you prefer to self-assess or have additional income to report, you can file an IR3 regardless of whether IRD issued an automatic assessment.