Individual income tax return guide 2011 - Inland Revenue Department

www.ird.govt.nz
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Question 32 Independent earner tax credit
(IETC)
You can calculate your IETC:
on our website at “Work it out”
by using the worksheets provided in this section
by calling our 0800 self-service line—see page 69.
IETC
The IETC is a tax credit for individuals whose annual net income* is
between $24,000 and $48,000. Your annual net income is shown at
Box 27 “Income after expenses” in your return.
If your eligible for IETC, but earn over $44,000, your annual entitlement to
IETC decreases by 13 cents for every dollar earned above $44,000.
For the period 1 April 2010 to 31 March 2011, you’ll be entitled to IETC
for any months, when:
you were a New Zealand tax resident
you or your partner weren’t entitled to Working for Families Tax
Credits (or received an overseas equivalent)
and you didn’t receive:
an income-tested benefit
NZ Super
a veteran’s pension
a foreign pension or benefit, or
an overseas equivalent of any of the above.
You’re a tax resident if you lived in New Zealand for more than 183 days
in the last twelve months, or have an enduring relationship with New
Zealand. For more information, read our guide New Zealand tax residence
(IR 292) at www.ird.govt.nz
To work out the months you’re entitled to this tax credit, use the total
number of whole months the above criteria applied to.
If you didn’t meet the above criteria for even one day of any month
you won’t be entitled to IETC at all for that month, so don’t include
it in your calculation.
* Net income means your total income from all sources less any allowable
deductions or current year losses (not including any losses brought forward).