Tax Refund NZ: How IRD Automatic Assessments and Refunds Work

For most salary and wage earners in New Zealand, tax refund season no longer involves filling in a form and hoping for the best. Since Inland Revenue moved to automatic income tax assessments, the department works out your end-of-year tax position for you, then either pays a refund straight into your bank account, sends you a bill, or confirms you paid exactly the right amount.

This guide explains how that system works in practice: who gets assessed automatically, why refunds happen, how and when the money is paid, what to do if you get a bill instead, and how to fix things if your assessment looks wrong. If you mainly need the calendar of filing dates and deadlines, our companion guide on when your tax return is due in NZ covers those in detail. This page stays with the refund itself.

How automatic assessments work

The New Zealand tax year runs from 1 April to 31 March. After it ends, employers, banks and investment providers send Inland Revenue your income and tax information. That reporting runs from April into late May, and it is the raw material for your assessment.

If all of your income was taxed before you received it, Inland Revenue has everything it needs and prepares your assessment for you. According to Inland Revenue, that covers income such as:

• salary and wages
• New Zealand Superannuation
• income-tested benefits, such as Jobseeker Support or Sole Parent Support
• schedular payments to contractors
• interest and dividends
• income from portfolio investment entities (PIEs), including KiwiSaver
• taxable Māori authority distributions
• benefits under an employee share scheme

Inland Revenue starts issuing these assessments from the last weekend in May and keeps going through June and July. If you use myIR, expect yours somewhere in that window. If you do not use myIR, it arrives later by post, and if Inland Revenue is still waiting on income information from a payer, your assessment may not land until July. Working for Families assessments are squared up over the same period, based on your actual family income for the year rather than the estimate your payments were based on.

The scale is large. Inland Revenue’s May 2026 media release noted that in 2025 about 3.63 million taxpayers received an automatic assessment, 2.37 million of them got refunds, and 337,000 had tax to pay. More than a million of those refunds were under $20, which says something about how accurate PAYE usually is.

Not everyone is in the automatic system. If you earned income that was not taxed before you got it, for example self-employment, rental or overseas income, you still need to file an IR3 return. The refund mechanics for IR3 filers follow the same logic, but the timing runs off your filing rather than the May to July assessment batches.

Why you might get a refund

PAYE is deducted pay period by pay period, using the tax code you gave your employer and assuming your income carries on at the same rate all year. Real life rarely cooperates. Common reasons a refund turns up include:

• You worked part of the year. If you started work partway through the year, took parental leave, had a gap between jobs or arrived in New Zealand mid-year, tax was likely deducted as if each pay would continue for a full year. On a lower annual income, some of that tax was overpaid.
• Your income jumped around. Variable hours, overtime in some months and quiet ones in others, or a bonus taxed in a single pay can all push deductions above what your final annual income actually required.
• Your tax code was wrong. A code that did not match your situation, or secondary tax on a second job at a flat rate, often collects more than the final calculation needs.
• Your PIE was taxed at the wrong rate. If your KiwiSaver or other PIE income used a prescribed investor rate that was too high for your income, the difference is corrected in your assessment.
• You were owed the independent earner tax credit. If you were entitled to the independent earner tax credit but did not receive it during the year, Inland Revenue pays it after your assessment is processed.

The reverse also happens, and it helps to remember the assessment is not a prize draw. It is a reconciliation: tax already paid compared with tax actually owed on the income Inland Revenue knows about.

How refunds are paid, and how long they take

Refunds are paid by direct credit into the bank account Inland Revenue has on file for you, at the time your assessment is processed. Inland Revenue no longer pays refunds by cheque, so a current bank account on record is essential.

A few practical points from Inland Revenue:

• Because assessments are processed in batches, refunds arrive at different times. Your refund might reach your account before your assessment notice does, or just after. Both sequences are normal.
• Once Inland Revenue sends the payment, your own bank’s processing applies, and the money should show in your account within a few days.
• If Inland Revenue does not hold bank account details for you, it will let you know it needs them. You can add or update your details in myIR at any time.
• If a payment bounces back, for example because an account was closed, Inland Revenue will try an updated account if it has one, or contact you for new details.
• If you already owe Inland Revenue money, some or all of your refund can be put towards that debt. Inland Revenue says it will tell you in a separate letter if this happens. A refund can also be applied to a Working for Families or income tax bill in the household, including a partner’s.

To check where things stand, log in to myIR and open your income tax assessment. It shows whether you are due a refund, have tax to pay, or paid the right amount. Before the season starts, it is worth five minutes in myIR confirming your email address, postal address and bank account are current, because Inland Revenue pays refunds faster when your details are up to date.

If you get a tax bill instead

A bill means the tax deducted during the year fell short of your final liability. It happens most often where income came from more than one source, a tax code was too low, or investment income was taxed at too low a rate.

The due date is generous compared with the assessment date. Tax owing on an automatic assessment must be paid by 7 February following the assessment season. If you have a tax agent with an extension of time, the due date is 7 April instead. In some cases Inland Revenue can automatically write off a small amount of tax to pay, and it explains write-offs alongside the assessment result.

If you cannot pay in full by the due date, contact Inland Revenue rather than ignoring the bill. Instalment arrangements are available, and Inland Revenue is clear that interest and late payment penalties can apply to unpaid tax, so an early conversation is cheaper than a late one. To see how a bill or refund relates to your likely tax on this year’s income, the NZ tax rates guide sets out the current brackets, and our income tax calculator lets you run your own numbers.

Boosting your refund: credits people miss

Two entitlements regularly show up as money back at the end of the year.

Donation tax credits

If you donated $5 or more to an approved donee organisation, such as a registered charity or a school, you can claim a donation tax credit of 33.33% of the amount you gave, up to the level of your taxable income. Unlike the automatic assessment, this one is not done for you: you need to submit your donation receipts.

The easiest way is in myIR. You can upload receipts during the year as you receive them, then the claim is processed after the tax year ends. If you do not use myIR, you can claim on the Tax credit claim form IR526, with all receipts submitted after 31 March. Inland Revenue also allows donation tax credit claims for up to the past 4 years, so a forgotten shoebox of receipts may still be worth something.

Independent earner tax credit

The independent earner tax credit is worth up to $520 a year for eligible earners. Many people receive it through their pay by using an ME tax code, but Inland Revenue confirms that if you were entitled to it and did not get it during the year, you will receive it once your income tax assessment has been processed. No separate claim is needed.

Refund scams: what Inland Revenue will and will not do

Assessment season is also scam season. Inland Revenue warns that criminals time fake refund emails and texts to land just as real assessments go out, hoping to trick people into handing over bank or credit card details.

Inland Revenue’s official guidance on staying safe is simple:

• Refunds are only ever paid directly into the bank account Inland Revenue has on record for you.
• Inland Revenue will only ask you to log in to myIR by going directly to ird.govt.nz yourself, not by clicking a link in an email or text.
• If Inland Revenue needs your bank account details, it will ask you to provide them securely, through your myIR account or by calling its contact centre.

So if a message tells you a refund is waiting and asks you to click through and enter card or bank details, treat it as fake, however convincing it looks. Type the address in yourself, check myIR, and if there is genuinely money coming, it will already be on its way to your account on file.

If your assessment is wrong

Assessments are only as good as the information behind them, and sometimes a payer reports the wrong amount or income is missing. Inland Revenue asks you to check your assessment when it arrives, and to tell it if any details are wrong.

Start in myIR, where you can view the income Inland Revenue used and change your assessment details if something is incorrect. If the mistake was in a return you filed, Inland Revenue’s guidance is to fix errors in myIR where you can, or ask Inland Revenue to fix them. It specifically says not to send in a replacement return.

If the issue is bigger than a wrong figure, for example you disagree with an assessment or a decision Inland Revenue has made, there is a formal disputes process. That starts with a Notice of proposed adjustment (form IR770), which generally must be sent within 4 months of the date on the assessment or the date Inland Revenue received the return you want changed. Disputes take time, so the myIR correction route is the right first step for straightforward errors.

The short version

• If your income is fully taxed at source, Inland Revenue assesses you automatically between late May and the end of July. There is nothing to file.
• Refunds are direct credited to your bank account on file as your assessment is processed. Keep your myIR details current and the money arrives faster.
• Bills are due by 7 February, or 7 April if you have a tax agent with an extension of time.
• Donation receipts are the big missed opportunity: upload them in myIR and claim 33.33% back, including for past years within the 4-year window.
• Inland Revenue never asks for bank details through an emailed or texted link. Go to ird.govt.nz yourself.

You will find more guides like this in our Finance section.

Sources

• Inland Revenue, When we work out your tax for you: income tax assessments: https://www.ird.govt.nz/income-tax-assessments
• Inland Revenue, Timelines at the end of the tax year: https://www.ird.govt.nz/income-tax/income-tax-for-individuals/what-happens-at-the-end-of-the-tax-year/timelines-at-the-end-of-the-tax-year
• Inland Revenue, Refunds and tax bills: https://www.ird.govt.nz/income-tax/income-tax-for-individuals/what-happens-at-the-end-of-the-tax-year/income-tax-assessments/refunds-and-tax-bills
• Inland Revenue, I received an income tax assessment: https://www.ird.govt.nz/situations/i-received-an-income-tax-assessment
• Inland Revenue, I received a refund: https://www.ird.govt.nz/situations/i-received-a-refund
• Inland Revenue, End-of-year assessments (Working for Families): https://www.ird.govt.nz/working-for-families/yearly-review-and-assessment-processes/end-of-year-assessments
• Inland Revenue, Watch out for scammers this tax season (media release, 15 May 2026): https://www.ird.govt.nz/media-releases/2026/watch-out-for-scammers-this-tax-season
• Inland Revenue, Submit a donation receipt: https://www.ird.govt.nz/income-tax/income-tax-for-individuals/individual-tax-credits/donation-tax-credits/submit-a-donation-receipt
• Inland Revenue, Getting the independent earner tax credit (IETC) if you earn only salary or wages: https://www.ird.govt.nz/income-tax/income-tax-for-individuals/individual-tax-credits/independent-earner-tax-credit-ietc/getting-the-independent-earner-tax-credit-if-you-earn-salary-or-wages
• Inland Revenue, Understanding your income tax assessment letter: https://www.ird.govt.nz/income-tax/income-tax-for-individuals/what-happens-at-the-end-of-the-tax-year/income-tax-assessments/understanding-your-letter
• Inland Revenue, Fixing mistakes in my return: https://www.ird.govt.nz/managing-my-tax/fixing-mistakes-in-my-return
• Inland Revenue, Fill out a Notice of proposed adjustment (NOPA) – IR770: https://www.ird.govt.nz/managing-my-tax/disputes/fill-out-a-notice-of-proposed-adjustment