Accounting income method, people working Accounting income method, people working Accounting income method, people working

A better way for your business to manage provisional tax.

The accounting income method (AIM) makes managing provisional tax easier for businesses with a turnover of less than $5 million.

It uses AIM-capable accounting software to easily and accurately work out your payments.

This puts payments more in line with the profit you make.

What sets AIM apart from other provisional tax payment methods is that you only pay when you make a profit.

Find out how we made managing AIM easier.

You'll get the most out of AIM if

  • your business is growing
  • you're new to business
  • you have irregular or seasonal income
  • it's hard to accurately forecast your income, or
  • you have accounting software or want to start using accounting software.

To use AIM you must have an annual income of less than $5 million.

Some types of taxpayers cannot use AIM:

  • trustees and beneficiaries of a trust
  • partnerships
  • taxpayers who have investments in foreign investment funds or controlled foreign companies for the income year
  • Māori authorities
  • portfolio investment entities, and
  • Superannuation funds

Why people choose AIM

Pay as you go: The amount of tax you pay is in line with the profit you make.

Better accuracy: You'll pay provisional tax based on real profit made, not estimated.

Avoid penalties and interest: No 'use of money interest' charges as long as you pay tax in full and on time.

Refunds: If you make a loss or overpay, you'll be able to get a refund straight away.

See how AIM compares to other provisional tax methods.

Making the switch

We recommend that you talk it over with your tax professional when switching to AIM.

You can start using AIM any time during the year.

AIM-capable accounting software is available from these providers:

Getting set up

Learn more about AIM

The technical stuff

There are two possibilities for filing and paying provisional tax:

  1. You'll file and pay provisional tax every month if you report GST monthly.
  2. You'll file and pay provisional tax every 2 months if you report GST every 2 or 6 months, or are not GST registered.

Statement of activity

AIM software works out your income and expense information and sends it to us in a statement of activity.

Overpayment

If you make an income loss during the year, you might end up paying too much provisional tax. AIM lets you get a full or partial refund, hold it, or transfer it to another tax type or account. It's the only provisional tax method that allows this.