IR3 ACC personal services rehabilitation payments

If you’ve had a workplace injury your employer may manage these payments rather than ACC. If you or your caregiver receive these payments, regardless of whether ACC or your employer makes them, you’ll need to read this information before you complete your return.

Any ACC personal service rehabilitation payments paid by ACC or your employer direct to the client or caregiver, are schedular payments and will have tax deducted before the payments are made.

Depending on their circumstances, ACC clients or carers receiving ACC personal service rehabilitation payments may not be required to file an IR3.

Do I need to file?

Are you a caregiver receiving payments from ACC, or a caregiver paid by a client?

If you earn over $14,000 from all sources of income, you’re required to file an IR3.

If you earn less than $14,000, you’re not required to file an IR3 because enough tax will have been deducted during the year from these payments. However, you may have another reason to file an IR3— see Do you need to file an IR3 return? for more information.

If you’re not required to file an IR3 please call Inland Revenue on 0800 377 774 and they will update their records.

Are you a client who received these payments from ACC and then passed on those payments to your caregiver?

Because you’ve received these personal service rehabilitation payments from ACC to pass on to your caregiver, Inland Revenue have sent you an IR3.

You’re not required to file an IR3 if:

you have no other income
you’re not liable for child support
you don’t have a student loan and income over the threshold
your family is not entitled to Working for Families Tax Credits
you have no other reason to file—see Do you need to file an IR3 return?

Please note the above rules apply whether or not you’ve passed these payments on to your caregiver.

If you’re not required to file, please call Inland Revenue on 0800 377 774 and they will update their records.

If you’re a client or caregiver who is required to file, please read the information on the following pages before you complete Questions 12 and 26.

Question 12 Schedular payments

If you’re a caregiver paid directly by ACC

Use the income from schedular payments information on your summary of income (SOI) to help you complete your IR3. If you haven’t received an SOI, call Inland Revenue on 0800 377 774 and they will send you a copy.

If you haven’t given ACC your IRD number, please include any payments that aren’t on your SOI in your IR3.

Enter the amount of tax deducted in Box 12A. Enter the total gross payments in Box 12B.

If you’re a caregiver paid by the ACC client

Using the records you’ve kept on the amount of personal service rehabilitation payments you received throughout the year, work out the gross payments to show in your return.

Calculating your gross payments

If any of your payments had the 25.5% no-notification tax rate applied, you will need to complete the following worksheet.

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Total gross payments amount for the year

If you’re registered for GST, your gross schedular payment may include GST. Enter the GST-exclusive amount at Question 12B.

Calculating your tax deducted

If the payments you received didn’t have tax deducted from them or you received any other income that didn't have tax deducted from it, print it in Box 24 of your return. Attach the details of your income to your return.

If you’re an ACC client

If you’ve kept all payments and haven’t paid any of the money received from ACC to your caregiver(s), use the amounts from schedular payments information on your SOI.

Enter the tax on schedular payments in Box 12A and enter the total gross payments in Box 12B.

If you haven’t received your SOI, you can get these details from myIR secure online services or call Inland Revenue on 0800 377 774 and they will send you a copy.

If you haven’t provided ACC with your IRD number, please include any payments that aren’t on your SOI in your IR3.

If you’ve passed on all the income to your caregiver(s) you don’t need to include these from your SOI at Question 12. This is because these payments, when they’re all passed to your caregiver(s) throughout the year, are considered exempt income to you.

You won’t need to put any amount in Boxes 12A or 12B.

If you’ve been reimbursed by ACC for amounts that you’ve paid to caregiver(s) before 1 April 2018 you won’t need to put any amount in Box 12B but you’ll include the tax on schedular payments from your SOI in Box 12A.

If you’ve kept some of the income, you’ll include the total gross payments from your SOI at Box 12B but claim any of these payments you’ve passed on to your caregiver(s) as a deduction at Question 12C. Read Question 12C Expenses related to schedular payments.

If you haven’t given ACC your IRD number, please include any payments that aren’t on your SOI in your IR3.

Please use worksheet 4 “Calculating your available tax credit” at Calculating your tax deducted to determine your tax deductions. This total will be added at Question 12A. You’ll also need to complete worksheets 1 to 3 at Calculating your gross payments before you can calculate your available tax credit.

Question 12C Expenses related to schedular payments

If you’ve kept some of the income

To help determine your allowable deduction, you’ll first need to determine your caregiver’s gross payments. Complete worksheets 1 to 3 and include the amount from Box 5 at Box 12C of your IR3 return.

Please attach a copy of the payments you made to your caregiver(s) with your IR3.

Calculating your deduction

If any of your payments had the 25.5% no-notification tax rate applied you’ll need to complete the following worksheet.

Your allowable deduction

Please attach a copy of the payments you made to your caregiver(s) with your IR3.

Please use worksheet 1 on the next page to calculate the tax deducted, which you’ll need to include at Question 12A.

Calculating your tax deducted

More information

If you have any questions about your tax please go to the Inland Revenue website www.ird.govt.nz