Standard Uplift 105% Vs 110%
Standard uplift is last year’s residual income tax plus 5% (105%). If an extension of time means you have not filed that return yet, an early instalment uses residual income tax from 2 years ago plus 10% (110%), then later dates catch up.
Inland Revenue uses the standard option unless you choose another method. You pay 3 instalments, or 2 if you file six monthly GST returns. The 105% path and the 110% path are not two different methods. They are two bases on the same option, and the switch sits on the filing date plus whether you have an extension of time.
Start here
Have you filed last year’s return on or before the first provisional tax date?
Yes: use 105%
Inland Revenue: 3 equal instalments of last year’s residual income tax plus 5%. For a 31 March balance date those dates are 28 August, 15 January, and 7 May.
No: ask the next question
Do you have an extension of time? If you do not, stay on last year plus 5% even if the return lands after a provisional tax date.
Extension of time, and still unfiled
That early instalment uses residual income tax from 2 years ago plus 10%. After you file, Inland Revenue rebuilds the later dates so the year heads toward last year plus 5% minus what you already paid.
Residual income tax is the leftover tax after listed credits. The definition and the more than $5,000 trigger sit on what residual income tax is. Dollar splits for a March year are on the provisional tax calculator. Who pays and which option you elect stay on the provisional tax hub.
Which Uplift Applies
Inland Revenue’s standard option page: your instalments are based on previous year’s residual income tax plus 5%, or residual income tax from 2 years ago plus 10%. The uplift to use depends on when you file the previous year’s return and whether you have an extension of time.
No extension of time: provisional tax is previous year’s residual income tax plus 5%. That still applies if you file after any of your provisional tax dates. Having a tax agent is not a permanent 110% setting. IR289 notes a tax agent will usually have an extension of time, which is why early dates can sit on the older year until the return is in.
IR289: if residual income tax was $10,130, next year’s provisional tax on last year plus 5% is $10,636. If you have an extension of time and have not filed on or before the first or second instalment date, the early amount is based on residual income tax from 2 years ago. If that older figure was over $5,000, add 10%. If it was under $5,000, you do not have to pay provisional tax on that basis.
30 day amendment
Inland Revenue: if the previous year’s return is reassessed or amended within 30 days of a provisional tax instalment date, that instalment does not change. Work it from the original assessment.
How Each Instalment Is Built
For a 31 March balance date Inland Revenue lists 28 August, 15 January, and 7 May on the standard option. If the date is a weekend or public holiday, a return filed or a payment made on the next working day is treated as being on the instalment date. That can change which uplift applies. GST registered people can have other instalment options. If you file six monthly GST returns, Inland Revenue says you pay 2 equal instalments when those GST returns are due, and the work out page tells you to divide residual income tax by 2.
| When the previous year’s return is filed (extension of time) | First instalment | Second instalment | Third instalment |
|---|---|---|---|
| On or before 28 August | Last year plus 5%, then divide by 3 | Same equal third | Same equal third |
| After 28 August and on or before 15 January | 2 years ago plus 10%, divide by 3 | Last year plus 5%, times 2, divide by 3, minus the first payment | Last year plus 5% minus the first and second payments |
| After 15 January and on or before 7 May | 2 years ago plus 10%, divide by 3 | 2 years ago plus 10%, times 2, divide by 3, minus the first payment | Last year plus 5% minus the first and second payments |
| After 7 May | 2 years ago plus 10%, divide by 3 | 2 years ago plus 10%, times 2, divide by 3, minus the first payment | Expected last year residual income tax plus 5%, minus the first and second payments |
That table follows Inland Revenue’s work out page and IR289 for a 31 March year. Even if you file after 7 May, IR289 still bases the year on previous year’s residual income tax once that figure is known. You can change from standard to AIM or estimation at any time. You cannot change to the ratio option in the same year. GST timing with ratio and AIM is on GST and provisional tax.
IR289 Catch Up Example
IR289: Ned, EJ Auto Services
The company has an extension of time. The 2023 return does not have to be filed until 23 January 2024, so the first two 2024 instalments are due before residual income tax for 2023 is known.
2021 residual income tax $24,000 plus 10% ($2,400) = $26,400. 28 August 2023: $8,800. 15 January 2024: $8,800.
The 2023 return is filed on 23 January 2024 showing residual income tax of $23,740. 7 May 2024 catch up: $7,327 ($23,740 plus 5% minus $8,800 minus $8,800).
Use case: same figures as Ned
Situation: a labelled IR289 company with an extension of time, so August and January are paid before last year’s return exists. Uplift: those two dates sit on 2 years ago plus 10%. Action: after the return is in, do not keep paying 110% thirds. Rebuild the May date from last year plus 5% minus what already went in.
Lesser of 105% or 110%
IR289: if the previous year’s return was not filed on or before a provisional tax due date, and you have an extension of time, the amount that should have been paid for that instalment is the lesser of the 10% uplift (based on 2 years prior) or the 5% uplift (based on the previous year). That does not apply to the final instalment.
What People Mix Up
PersonalFinanceNZ often treats 105% as the only standard figure, then gets surprised when myIR shows a 110% third. Inland Revenue only puts you on 2 years ago plus 10% when there is an extension of time and that return is still unfiled at the instalment date. DIY filers with no extension of time stay on last year plus 5% even if they file late.
Some blogs split the year 35, 35, and 30. Inland Revenue’s work out page divides by 3 (or by 2 for six monthly GST). Equal thirds, then a catch up, not a 35/35/30 split.
A 2020 write up treated Inland Revenue overwriting 110% with 105% when last year dropped as a grey area. IR289 now states the lesser of rule in plain words for those early instalments. Follow the April 2025 guide, not the 2020 bill note. Treasury and Inland Revenue tax cut pages from 2008 still mention 105% and 110%, plus a one off $730 reduction that applied around those years. That dollar cut is not the live 2026/27 formula.
If income has dropped, estimation can be the better path. Inland Revenue lets you change from standard to estimation at any time. Pay on time: the work out page says late payments can attract penalties and interest.
Frequently Asked Questions
Does having a tax agent mean every instalment is 110%?
No. Inland Revenue uses last year’s residual income tax plus 5% unless you have an extension of time and you have not filed the previous year’s return on or before that instalment date. A tax agent often has an extension of time, but once the return is in, later instalments move to last year plus 5%.
If I file after 28 August, do all three instalments stay on 110%?
No. For a 31 March balance date, Inland Revenue: if you file after the first instalment and on or before the second, only the first instalment uses residual income tax from 2 years ago plus 10%. The second and third use last year plus 5%, with a catch up so the year totals last year plus 5%.
What if last year’s residual income tax plus 5% is less than 2 years ago plus 10%?
IR289: if the previous year’s return was not filed on or before a provisional tax due date, and you have an extension of time, the amount that should have been paid for that instalment is the lesser of the 10% uplift (based on 2 years prior) or the 5% uplift (based on the previous year). That does not apply to the final instalment.