What is independent earner tax credit and how do I get it?

Independent Earner Tax Credit (IETC) is a tax credit you can get if you earn between $24,000 and $48,000* per annum and are not claiming a Working for Families Tax Credit.  It is a tax credit of up to $520 so if you’ve paid more than this in tax, you can receive this back as a tax refund.​

*Changes from 31st July 2024 - the upper threshold is changing from $48,000 to $70,000 (details below).​​

You can get IETC if you meet the following conditions: ​

Use this tool provided by IRD to check if you’re eligible for IETC. ​

If your pre-tax income is between $24,000 and $44,000 per annum, you can get $10 per week; if your annual pre-tax income is between $44,001 and $48,000, IETC reduces by $0.13 for every dollar exceeds $44,000. ​

The government has announced an upward adjustment to the thresholds, effective from 31st July 2024. Consequently, the full IETC will apply up to an increased pre-tax income limit of $66,000 with the same $0.13 per dollar abatement rate for those with an annual pre-tax income between $66,000 and $70,000.​

As this change is taking effect during the 2024/25 financial year, there will be a transitional calculation done by your accountant when you submit your 24/25 accounts. The new IETC entitlement for those earning between $48,000 and $70,000 will apply in full from the 2025/26 tax year.​

If you’re a Beany client, you don’t have to do anything as we claim it for you whilst we’re doing your tax returns. If you’re not a Beany client, then you can file a return online at the IRD and claim it, or become a client (register with us today so you don’t miss out on IETC).​ You can see more information on Independent Earner Tax Credit on IRD’s website.​

Call us on 0800 755 333 or contact support@beany.com for more information on this or any other tax query.​​

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