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Cost of Living Payment 2022
Rising expenses have led the Government to introduce a Cost of Living payment to ease the pressure of increasing expenses. The payments total $350 and may be paid in instalments from the 1st of August to the 3rd of October 2022, or it may be paid in a lump sum. If your net income before tax was under $70,000.00 in the financial year ended 31st of March 2022, you may be eligible.
If you are on a salary or wage, they consider your income minus your claimable expenses before tax. IRD’s example is that if you earned $90,000 and had $20500 in claimable expenses, you will be eligible. But if you earned $90,000 and paid $20,620 tax, without any claimable expenses you would not be eligible.
For business owners it is income minus claimable expenses, excluding losses from prior years. If you earned $90,000 but your claimable expenses were only $10,000, your loss carried forward from the prior year will not bring into the required range.
It is based off your individual, not household, earnings. However, you must have earnings other than Portfolio Investment Entity (PIE) income.
Your 2022 tax return will inform IRD of your income. IRD will continue to check for eligibility until the 31st of March 2023, so tax returns filed later in the year will still be captured if you have an extension of time, granted to many of those who have an accountant.
Because this payment is intended to provide relief for those with lower incomes, it will not be required to be reported for benefits, child support, student loan, and other similar funding services. It will not be reassigned by IRD to pay off outstanding IRD debts.
You do not need to do anything to receive this payment except making sure your information with IRD is correct, such as your age and bank account. You do not need to apply for this payment: IRD will automatically assess your eligibility. If you would like to check the information IRD holds you can log in to your myIR or ask your accountant.
Please see the link below for further eligibility criteria, IRD has provided some detailed examples, such as what happens if you do not meet some of the criteria until after the first or second payment, and how your income eligibility is assessed.