High earners pay tax early to escape new 39% rate

The 11 cents in the dollar difference between the company and top personal tax rate seems to have spurred action. (Image: Getty)

Pattrick Smellie

Mon, 31 Jan 2022

Company owners looking to avoid the new 39% top tax rate are producing a one-off surge of tax payments to the Inland Revenue Department, according to a briefing paper from the tax agency.The Nov 5 briefing shows a 291% upward bounce in dividend income declared by companies in the year to March 31 2021 for 119,000 high income individuals.The figure may yet be higher as, at that date, some 40% of income tax returns had yet to be filed by people who earned more than $170,000 in the 2019 and 2020 tax years and more than $180,000 in the 2021 tax yea...

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