Opposition says Govt warned as overseas Kiwis could get $350 payment

Source: 1News

Some New Zealand ex-pats have been left scratching their heads after messages from IRD told them they'd be receiving the first chunk of the Government's $350 cost of living payment, despite living overseas.

Money file image.

By Nicole Bremner and James Baker

But as dozens of reports flooded social media on Sunday, Opposition and tax experts say the Government was warned there would be issues with the rollout.

The first of three $116 instalments from the Government to help with the cost of living is due tomorrow.

READ MORE: Ardern rejects claim Govt spending making inflation worse

The payments were announced in this year's budget, for those who earn $70,000 a year or less, aged 18 and over, and who are not entitled to the winter energy payment.

Another key requirement for those receiving the payment is that they reside in New Zealand.

But as one Reddit user said on Sunday, he hadn't stepped foot in the country in more than two years.

"IRD e-mailed me saying they are going to give me money. Great! The only problem is that I don't actually live in New Zealand.

"Now, as a foreigner, I don't want to tell you how to run your country but I'd suggest perhaps Kiwi taxpayers dollars should be going into Kiwi pockets."

National's Finance spokesperson Nicola Willis told 1News she's received dozens of similar messages from offshore Kiwis.

"They didn't ask for the payment, they don't want it, and frankly they felt they don't deserve it.

"The Government needs to answer these questions.

"How many non-resident New Zealanders will be receiving this payment and why, and what are they going to do to fix it."

A document provided to 1News by Willis claims to show IRD warned of potential issues providing targeted payments to eligible Kiwis.

"Some of the information IRD holds may not be up to date. This would mean some people who receive the payment may not, and conversely, some people who received the payment should not have," part of the document reads.

The payments were announced as part of Budget 2022 in an effort to reduce the burden of the rising cost of living.

An estimated 2.1 million people are eligible for the three monthly payments from August 1, receiving a total of $350.

The projected cost of the rollout is $816 million.

Of that, $800 million is going into Kiwi pockets, the other $16 million has been diverted to IRD to resource the 700 staff project.

Despite the extra resources, tax specialist Terry Baucher says IRD were always going to struggle to hand out the payments.

"It was a rushed process, it came in really late, in the budgeting process, they hadn't planned for.

"Even if they had statistically with something like this there's always going to be human error."

Not only does the project require massive time and labour, but often IRD simply doesn’t have access to the information they need he says.

"Quite simply, you're not required to tell IRD you've gone overseas unless you've got a student loan."

An Inland Revenue spokesperson said eligibility was based on “a variety of information… held at the time” including addresses, bank accounts and tax residency status

"It is possible that, for a number of technical reasons, there will be people who didn’t expect to get the cost of living payment, who are eligible to receive the first of the three payments due tomorrow.

"People must have had a 2022 tax assessment with eligible income such as salary and wages or bank interest.

"If someone has left the country and hasn’t told Inland Revenue they’re not living here currently we will have treated them as [a] resident here and they may receive the Cost of Living payment."

But also made it clear that they wouldn’t chase after those given payments by mistake.

“We'll only apply resources to identify such cases and to recover payments when there has been fraudulent or willfully misleading information provided."

1News approached Finance Minister Grant Roberston for comment. His office advised Robertson is overseas and referred 1News to Revenue Minister David Parker. Parker's Office referred 1News to the IRD advising it was an 'operational matter.'