Commissioner may grant relief from late payment interest

Section 146(3) and (4), and schedule 7, clause 6

For the 2012-13 tax year, an amendment has been made to ensure that when a borrower has applied for and been granted relief from that late payment interest, any interest already paid is offset against any unpaid amount and then against any current year repayment obligation before being refunded. This ensures that amounts are not refunded to borrowers while they still owe money to Inland Revenue.

Changes have also been made to schedule 7, clause 6, which amends section 146 with effect from 1 April 2013. This amendment corrects a minor drafting error to ensure that the relief applies when the late payment interest has been added to a borrower's unpaid amount.

Application date

The amendments apply from 1 April 2012 and 1 April 2013 respectively.