The New Zealand Tax Podcast – talking provisional tax and the benefits of tax pooling, with TMNZ’s CEO Matt Edwards

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My guest this week is Matt Edwards, the CEO of tax pooling company Tax Management New Zealand (TMNZ). Morena Matt, welcome to the podcast.

Matt
Good morning, Terry. Thanks for having me this morning.

TB
Not at all, our pleasure. Now you've just celebrated your first year as CEO of TMNZ, but you have a quite an interesting background. Prior to joining TMNZ what were you doing and what insights did you gain from?

A 12-month OE which lasted 20 years…

Matt
So it's an interesting story, Terry. I was born in New Zealand and went to university in New Zealand and after I thought I I'd had had enough of small-town Wellington, which is where I grew up I got on an aeroplane and went over to the UK for a 12-month getaway I suppose you'd call it, and 20 years later I I came back, which is which is how it panned out.

I spent the majority of my career involved in what we call Fintech, so that's basically the intersection of financial services and technology. During the time I was in the UK, I built a couple of fintech businesses, the biggest one was a marketing services business actually that connected financial advisors to customers. So that was a very fun journey and that was going back, gosh, we started that business in 2010, I think.

So that was a little while ago now. And this was when Internet and Internet services were not brand new but still emerging a little bit. So, we were kind of on the cutting edge of that.

I sold that business to private equity five years later or so and then I got involved in running and developing portfolio businesses for private equity. The last business I was involved in, in the UK was actually a life insurance business. We were reimagining the way life insurance is bought and sold and consumed by the end user.

So, yes, most of that time has been spent taking technology and putting it into legacy businesses and seeing how we can make those businesses more efficient. So now I'm finding myself involved in tax and tax pooling, which is arguably a legacy business, having been around for 20 years.

TB
Yes, that's the surprising thing about tax pooling. It seems relatively recent, but it's now over 20 years old. Your career is interesting because you're not coming from a tax background. On the other hand, TMNZ’s founder Ian Kuperus and its previous CEO, Chris Cunniffe both worked at Inland Revenue. But you're coming with a different perspective, so I'd be interested to hear more about that and how you build on this legacy system. But just as a quick recap, what is tax pooling and how does it work?

What is tax pooling?

Matt
What it fundamentally is, when you when you boil it down, it’s a pool of tax sitting within Inland Revenue that has obviously been paid in at particular day. It's used for provisional tax payments, and what that pool allows us to do is essentially in very simple terms, move tax payments around.

So, if your business has overpaid on a provisional tax payment and another business that's underpaid on that payment, we're able to essentially swap those payments around. So, what that means is the business that has overpaid benefits from a slightly higher use of money interest rate on that. And the business that has underpaid avoids some penalties and use of money interest for the gap between the dates they’ve paid, and that pool is significant.

From a TMNZ point of view, our pool can be as high as $10 billion and there's other competitors in the market that do tax pooling as well.  So you're talking about a significant amount of tax that operates under the pool. Well into the multiple billions of dollars, so that's at a very high-level what tax pooling is or how it works. Once you get into the detail, it becomes some more complex obviously.

TB
But just to clarify for listeners, you don't actually hold that money, you and all the other tax pooling companies do not have $10 billion sitting in your bank accounts or accounts, and Inland Revenue gets notified that those payments are going across so they can see your balances and who has made payments.

Matt
Yeah, that's right. It operates under a trust arrangement, so TMNZ or other tax poolers don't actually physically touch any of those funds. They go via a trust arrangement and then they go into the Inland Revenue pool. So no, unfortunately we don't have $10 billion on our balance sheet, although that would be lovely if we did.

TB
Indeed.  Actually, a key point about it is, if you've paid into a tax pooling account, one of the other advantages is you can withdraw those funds at any time. You do not need Inland Revenue’s permission to withdraw the funds, so that gives a bit of flexibility.

The benefits of tax pooling

Matt
Yes, while the money sits in the pool effectively you can think of that as quasi liquidity for the business. It can be withdrawn at any time and the interesting thing about it is there's no cost implication other than perhaps a very minor bit of administration from a business to use the pool, whether they require tax pool and products on the end of that or not.

This is interesting because when you look into the market, you'd expect when you look at tax pooling that every single business in New Zealand would make all their tax payments via the tax pool, because there's no downside. The interesting thing about it is for an industry that's been around for 20 years. there are still thousands of businesses out there that are not using tax pooling and we're not paying their tax via the via the pool, which is quite surprising when you consider that there's absolutely no downside for a for a business to use it.

But you you're quite right, you can pull that money back out of the pool at any time, and there's various mechanisms for doing that. But if needs be, yes it can be drawn back down out of the pool.

TB
Yes that is true. This sounds so completely strange. Why would we do that? And I think there's always inertia. Well, you know, the old accounting matter, what did we do last year? Look at what we did last year, and we'll do it again this year.

TMNZ was the original tax pooling company, but you have several competitors in there. Still from what you're just saying, the market is not saturated so to speak, there's plenty of scope.

So why doesn’t everyone use tax pooling?

Matt
No, and what's interesting about the tax pooling industry is when you explore the stakeholders that are involved - you've got your taxpayer, obviously you've got your tax filing company, which in my instance is TMNZ and you've got your accounting services, and you've got Inland Revenue - there's absolutely no downside to any of those stakeholders in the process.

So, everybody is a winner, and I think you're right, Terry. I think It's inertia. “Hey, we've never done this. We've never paid through the tax pool. Why would we do this?”

It's nuanced to sort of understand why would I do this? I have a tax bill. I  pay that to Inland Revenue. That's how it works. And I think the other challenge you have is quite often from an advisor if they've not been engaged to a level where they're able to provide advice on using tax pooling or an efficient way of operating tax payment, they're probably not telling their client that.

So it is an inertia thing and it's really interesting because  in my experience, typically by the time a business model gets to 20 years old, you know you've reached the top of the bell curve. At the moment, the market is not saturated and you'd expect that most people who it's applicable to would be using it. And it's just simply not the case with tax pooling. There's still many, many businesses out there that aren't using it. From my point of view, that's super exciting, because it means there's a great deal of market out there that’s to be captured.

Using tax pooling beyond provisional tax

TB
Yes, indeed. Now primarily tax pooling developed around provisional and terminal tax, particularly. And as you said, the key thing to understand is this arbitrage between the use of money interest Inland Revenue will charge and late payment penalties which I think frankly is a little rude

But if you're charging 9.89% interest on overdue debt, then for the largest taxpayers such as the banks or the New Zealand Superannuation Fund their cost of funds is way below 9.89% and so they have the real problem of saying “we underpay our tax, we get crippling interest, but if we overpay our tax, we have no access to the funds.”

So, those taxpayers are very keen users and probably in every sense of the word, your biggest customers. But tax pooling has developed beyond provisional and terminal tax, hasn't it? You can actually use it for other taxes, including GST for example. In what circumstances can you use tax pooling for those other taxes?

Matt
If you've got funds in the tax pool you can use those funds to pay any of your standard corporate taxes that typically wouldn't be used to pay a social tax. But in a business context you can use pool funds to pay any kind of tax.

So, if you've got $100,000 sitting in the pool then you can use this to make a GST payment. Having said that, you can't take advantage as you described it of the arbitrage or the advantage and penalties and interest payments with other tax types.

So, if you've missed a GST payment and you're incurring a penalty and interest against that, then tax pooling and won't help you in that situation unless it's a reassessment.

Tax pooling and reassessments

Matt
So under a reassessment (assuming that you've acted reasonably and responsibly, and you've filed your tax returns appropriately) because there's been a mistake made, there's a calculation error, an advice error -  in that instance you can use tax pooling to mitigate what those penalties and interest payments would be under the under the reassessment situation. But generally speaking, the tax pooling regime is focused on income tax or provisional tax payments.

TB
I'm just talking about reassessments; that's quite an important thing because that's happening all the time. For example, Inland Revenue just recently trumpeted how it has raised over $900 million through reassessments. That's where it really comes in handy, and you've got tax going back for quite some time

Matt
The truth is we've got tax going back to 2007/2008 and the tax pool, which is a fascinating thing, when you think about it, should fall into a reassessment situation going back considerable amounts of time when you consider the interest implications over the course of seven or eight years. This could be significant in those situations.

TMNZ’s unique selling proposition

Matt
The big USP we have being the incumbent is because we have tax going back that far. It's highly likely that we can do something should you fall into that kind of reassessment situation and that interest is compounding on what's owed. Over time, it's obviously becoming a big number.

These are obviously not everyday instances, but when they do occur, they can have significant impacts on savings for the businesses involved.

TB
Can you put that in context back in 2007/8?  I think use of money interest rates reached a peak of 14.24%. So, if you've got something from there, you’ve been a very naughty boy. But as you say the savings would amount to tens of thousands of dollars.

A surprising fact about TMNZ’s customers

Matt
Yes, they can be hundreds of thousands of dollars depending on the circumstances.

That's also what's interesting, Terry. You may have been a naughty boy or a naughty girl of course. But you know, I reviewed the stats on reassessments and when you look at it, and don't quote me directly on it, but 65% of reassessments through Inland  Revenue come from technical mistakes. They don't come from someone trying to game the system or not pay their tax.

A better way to put that is, it's compliant taxpayers that have made a mistake. Either because of the advice they've been provided, or they've simply made a mistake.

In that situation, where you've got a compliant taxpayer, a mistake has been made that goes back a number of years, which has a large implication from a cost point of view on that business. It's brilliant, then, to be able to save some money across it because they really don't deserve to be aggressively penalised in that situation, I suppose.

TB
Just quickly about compliant taxpayers, that's 65% estimate figures out in my experience. Tax is complicated and I'm perennially advising clients on the question of how our Foreign Investment Fund regime operates, it is really quite an alien concept to people who come from Britain, for example, where there is a capital gains tax regime or the United States.

The Inland Revenue has the ability to charge shortfall penalties as well as interest. But typically, in my experience, if you come forward and said “oops, my bad”  only use of money interest will be payable, which is when you come in and mitigate that.

But I've yet to encounter many instances where shortfall penalties have also been thrown in there, and it leads on to what you're seeing from Inland Revenue at the moment.

So obviously you get to deal with a lot of reassessments.  Are you aware from Inland Revenue has the scale of those reassessments increased in the past few years?

Matt
Bearing in mind that I've only been looking at it for the for the last 12 months, I don't have a deep amount of data to look back into. Personally, I think the challenge for Inland Revenue now is growing tax debt.

The reason tax debt is growing is when you look at the cycle we've been through over the last five years –  with COVID in particular that introduces a situation where businesses really don't know what's going to happen. There's nothing you can compare that that to.

Inland Revenue’s post-COVID approach

Matt
A huge amount of money then went into the economy to obviously booster  the COVID situation which gave businesses a boom period. Really there were low interest rates and a huge amount of money sloshing around the economy.

We've gone straight from that to a very high-interest rate period - which let's be honest - we haven't experienced for decades, really. When you look at that run on very low interest rates for a long time, when you look at what those businesses have done, they've had COVID and then they've gone through this real boom period. Then it's suddenly gone down.  That's impacted businesses, but of course they still have tax to pay from previous years.

The tax debt is growing, and I think the interesting challenge from Inland Revenue’s point of view is yes, they've been very clear both directly in the media and with our communications that they are in the market to collect more tax. They’re going to do more assessments. They are doing more reassessments, but they're also juggling that against the fact that businesses are going through tough times now.

So, the challenge for them is determining between a business that's just not being responsible, not paying their tax, and will never be able to pay their tax, and a viable business that's just going through a difficult period and actually needs  support through that period. And to be quite honest with you, with what I see, I think they have been and continue to be very good at trying to support those businesses to get them compliant again, to pay the tax and basically for it not to be a business ending event for them.

When you look at government expenditure and tax debt, or when you have a look at the budget that's about to come out, there's a big incentive to collect tax. I think that that IR's approach is pragmatic Is probably what I would say there.

TB
I totally agree with all of that. And just to repeat a point we often make on the podcast, if you get into trouble with Inland Revenue, talk to them. You'd be surprised at how reasonable they are prepared to be. Unless, as you say, the taxpayer has been grossly irresponsible.

Matt
And I think you can separate those two categories relatively easily. But it's surprising how many businesses are still reluctant to want to interact directly with Inland Revenue. If a number shows up on the phone, it's Inland Revenue or it's unknown and the reaction is “I'm not going to take that call.”

The interesting thing is though, if the number shows up on the phone and it's TMNZ or a tax pooling solution, then the incentive to take that call and actually deal with the problem grows.

We can all play a part in this that delivers an outcome that's best for everyone. So I think the days of super aggressive Inland Revenue - and you know some of the stories we heard in the past - those days have gone. But nevertheless, I think business owners still enjoy that friendly face of dealing with someone who isn't ringing from Inland Revenue.

The impact of Inland Revenue’s Business Transformation

TB
Yes, absolutely. COVID is a very interesting thing because looking back over this, I talked to your predecessor, Chris Cunniffe,  five years ago in December 2019. Time flies but in that time, we've had two big events. The first being COVID, which we just talked about and clearly that's having an impact.

But the other thing that was just happening when I last spoke to Chris in December 2019 was Inland Revenue’s Business Transformation programme. And that was, as  you know, a huge project that was carried out and came in on time and under budget. How has Business Transformation played out from your perspective?

Matt
Obviously, my perspective is slightly different coming in after that project was completed, I think Inland Revenue has done an incredible job of digital transformation when you frame that up under the context of the complexity that they're dealing with and the legacy nature of tax collection.  I think when you look at Inland Revenue they've done a great job with that.

But I think from my perspective, what's very interesting with my interactions with them, they're still extremely open minded and extremely motivated to continue to make their function, which is tax collection, essentially more and more efficient. And what's super interesting about that is they very much see this now as an ecosystem place.

How do we make the tax system more efficient for everyone? And when you look at where the technology is going and our ability to connect directly with Inland Revenue and their ability to connect directly with us from a technology point of view, there is the potential to make the function of collecting tax easier, more efficient, less burdensome and costly for business.

The potential there is still significant and that excites me because that's really what I do and what I enjoy doing. But what probably excites me more is Inland Revenue’s openness to actually pushing this further and further. And the fact that they accept that it is an ecosystem, especially from a technology point of view.

And if we work together on that, we can really make a more efficient system. Although the transformation project itself may be over, we continue to work with them on what I would argue is pretty exciting stuff from a technical point of view.

Liaising with Inland Revenue

TB
This is where your experience in the fintech sector is absolutely crucial. You're touching on that you would have regular contact with Inland Revenue. You'd actually be meeting the senior officials there and talking these matters through as well, because there's a specifically dedicated unit within Inland Revenue that manages tax pooling. But apart from the people there, you're also meeting the senior honchos.

Matt
Yes.

TB
And how frequent are those meetings, and what insights have you gained?

Matt
Yes, we speak to the most senior officials and Inland Revenue on a regular basis. There are probably two angles that takes. One is more from a framework point of view. How can we take tax pooling and actually enhance what that's doing for business and enhance what it's doing for Inland Revenue?

Although I won't go into details of that now, we've got some pretty interesting stuff that we're working with now. To use tax pooling I suppose to try and help businesses through this period. I would argue that that touches closer to policy. So we speak to them regularly from a policy point of view which is very interesting.

And then we have a totally other side of the equation where we're talking to them specifically about the technology the digital side. So, there's two tranches there and you're quite right, it's quite interesting you know, without naming names, the people we speak to are the top people at Inland Rrevenue. So there's good communication channels there, direct access and they're very open to that, which means we can do cool stuff.

Comparisons with the UK

TB
How does that compare with your experience in the UK? Did you have, or need to have such interactions with HM Revenue and Customs?

Matt
No, that's very interesting. The chances of sitting down with the executive team at HRMC in the UK and discussing this stuff from the UK context would be very, very unlikely. So, one of the cool things about New Zealand is that I can pick up the phone and speak to the Commissioner of Inland Revenue if I need to. It also means that we can do cool stuff. So that's completely different to the environment that you had in the UK.

So yes, it's a real upside that New Zealand has right. As a smaller country we all sort of quasi know each other which is quite an interesting difference between things in the UK and New Zealand.

TB
Yes. Mind you, I think I'd take a call if I knew that person was holding $10 billion in tax.

Matt
Well, that's probably not the way we sell it, but yes, I know.

Looking ahead

TB
You've now had 12 months under the under the hood looking around, and you've come from this background and clearly you've got things in progress. Without revealing any state secrets or anything, what improvements or changes do you think you you'd like to see?

Matt
It's an interesting perspective. Obviously I've come into this with completely different eyes to the people that have traditionally been running tax pooling. You know Chris and I'm sure you've met Ian before; you know these guys are very experienced career tax people.

I've come in from completely the other angle. The big challenge that I've thrown down is, as I said earlier in our conversation, why are all businesses not using tax pooling? Even if that is simply just paying their tax into the tax pool and then transferring that tax to Inland Revenue.

There really is no reason that all businesses shouldn't be doing that. The fact is, when you look at it, I roughly think, 40 or 50% of New Zealand business still don’t use tax pooling in in any way.

It's also probably worth saying that I'm agnostic as to whether they use TMNZ or another tax pooling company from a high level. I just want every business to use tax pooling because of the benefits.

So when I ask myself “well, how do I address that challenge?” This gets into the strategy off running the business. How do I help all businesses to use tax pooling. When you stand back and look at it there's inertia in a lot of instances to actually using tax pooling.

Some of that's technology, some of it's a reliance on a tax advisor or an accountant being able to advise on how your business can use it. And you know there's two things there as well. That advisor needs to be able to charge for their advice, obviously. But they also need to have the knowledge themselves, and it's quite interesting when you look into the market. I think of tax pooling all day, so I assume everyone understands it to the level that I do.

Making tax pooling accessible

Matt
That’s simply not true, even within the accounting fraternity. So the real challenge is how do we make this accessible and simple to all New Zealand businesses so they can all use it.

Now if we want to look for an analogy, if you consider a credit card, a mortgage, an overdraft facility or a bank account or insurance. Most people don't understand the intricacies that go on behind providing those financial services. Almost nobody is going to read their hundred-page mortgage contract from end to end and analyse every point in that although maybe perhaps they should,

I don't think we've got to that stage with tax pooling. From my point of view, it's a case of how can we bring this product to market in an easy-to-understand way,  where you don't need to understand it, just like you don't need to understand the intricacies of how a credit agreement behind a credit card actually works.

I think at the moment that’s the piece that's missing. How do I make it easier for an advisor to take tax pooling to their client? How do I make it easier for a client to understand how tax pooling works? How do we make this more transactional? Probably what I'm saying is,  I think if we can answer that question, I think we'll rapidly see higher adoption through New Zealand businesses using tax pooling and obviously there can only be a win for business and for Inland Revenue.

Tax pooling an essential cash flow tool

TB
I totally agree with that and to reiterate here, because of the flexibility tax pooling provides, it is an essential cash flow tool.

Matt
It is and interestingly, when you get into it, and this is I guess, where we diverge between the way I think about it and the way I view the industry, and the way perhaps the tax advisor would view the industry, this is our cash flow smoothing tool, that's essentially what it is.

You can almost dismiss the tax element to a level and say, “hey, you've got an obligation to pay money at a certain date that's not aligning perfectly with your business model.” And let's be honest, if you look at provisional tax payments, they're set up under a model where you pay three times a year. There you go. Your business matches that. The reality is that there's businesses out there that in extreme circumstances make all their revenue within two weeks. That sort of pay tax model versus the reality of your business model.

The chances of those aligning perfectly are quite slim, so it isn't really about tax from that point of view, it's about cash flow smoothing.

So, if you have an obligation and I can say to you, “ Terry, you can simply pay X amount per month and your obligation is settled. Or pay nothing for this quarter or pay nothing for next quarter depending on what you need.”

So that is the real USP. Save money on use of money interest, save money on penalties. These things are fundamental to what we're doing. But at the end of the day, this this is a cash flow smoothing tool and it's a source in certain instances of capital for business or capital at a rate that's in most circumstances, especially in SME, that's significantly cheaper than the cost of accessing other types of capital.

TB
That's a really significant point. How our provisional tax filing dates developed is a whole other story but the long and the short of it, it was driven very much by the big end of town and that that's they wanted the payments to align.

Matt
Yes.

TB
And fair enough for you are paying 80-90% of the tax. That's not an unreasonable suggestion to make. The thing is, you're only 10% of the businesses and the rest of us are all in this position.

Like you said, there are businesses that have two weeks to make their money and then there are businesses where things go quiet and suddenly, ”oh, January, I've been on holiday. Oh, I've got a provisional tax payment.”

I'd be interested to know if you see a lot of requests around the January 15th payment, the provisional tax and GST is quite a quite a thump.

The problems with paying tax in January and how TMNZ can help

Matt
For want of a better example let's pick an industry. Let's assume you're in retail and Christmas is an important time for you. So ,you've just gone through that Christmas period and done a lot of trading. You've got a big GST payment coming up and then you've also got a provisional tax date sitting there. So in January it's rough times, right?

Business has been falling through the floor because you're through Christmas and suddenly you've got these two big tax payments coming, or May 7 could be another example of this.

So this is where the creativity and the ease of access is important. You've got GST and you've got a provisional tax payment owing on the back of that. So pay your GST that's important. Always pay your GST because, and fair enough to GST, as a tax you've collected it's not your money essentially, it's Inland Revenues.

TB
Always pay your GST, folks.

Matt
Finance your provisional tax The rate that you pay on net finance for most businesses apart from the very top end of town is going to be significantly less than what you can use in your overdraft or short-term funding facility or however you're funding your business. There's a way we can smooth out that that cash flow quite significantly, and can do it at a rate that's very, very competitive. From a business cash flow perspective, it's perfect, instead of exiting all of that cash out of your business at one time. You remain a compliant taxpayer; and you pay a rate on that that's very competitive compared to the other cost of capital.

But one of one of the frustrating things about the industry is what I've just described there. If we go out into the street and ask how many people are aware of this, the gulf is big and the number of businesses sitting out there that will using an overdraft facility that they could be paying 12/13/14/15% interest, to do this is significant.

When you think of the implications of that, in New Zealand we need economic growth. We've got a structure of problems in the country; we need to invest money into New Zealand. There's a massive piece of capital that potentially goes back into the market that grows that business. The business gets bigger and employs more people, who pay more tax in the long run, so it's a real win/win situation. That’s what excites me about it. It’s not necessarily about the provisional tax payment element of it, it's about what this can actually do for New Zealand business.

What are the potential savings?

TB
Alright. That sounds fantastic and I totally agree with that strategy. It's sometimes a difficult sell because you're up against inertia. But potentially what sort of savings could we be seeing by adopting that approach?

Matt
It's greatly circumstantial, Terry, obviously, so it's very difficult to say “hey, X is the savings.”  So you can't really take it from that point of view. If you consider a very basic situation, “ hey, look, I've fallen behind an income tax, I've got some income tax owing, and I want a solution for that.”

Depending on the amount of tax, you could be saving anywhere between 15 or 25% on what the cost implication would be if you choose not to use tax pooling. If, as we discussed earlier, you're looking at a long-term reassessment situation then, obviously those savings could be considerably and materially higher. You know you may be getting into 30 or even 40% saving on what it’s  otherwise going to cost you.

The other thing as well that's worth pointing out when we talk about savings is you'll save money, and you know  I'm a businessman. And if I save a dollar, I think that that's a job well done.

Saving money and staying compliant

Matt
So the savings will always be there. But I think the other thing that we shouldn't lose sight over is that you also remain a compliant taxpayer. That's a thing that we don't focus on enough. So you save money, and you remain  a compliant taxpayer. I think that's an important thing for the business, and I also think it's a very important thing for the people advising that business to ensure that they remain in that category.

TB
I couldn't agree more with you on that point. Often, I've come across situations where I've explained to clients “Well, this is the scenario, and this is the tax due.”  We're not tactical magicians who wave a wand and the tax bill goes away. It doesn't. What we're often doing is  we're mitigating the impact, explaining and bringing taxpayers up to date. More frequently than people might realise, I’m told “Well, that's just a huge load off my mind.” People want to be compliant and they're worried if they're not compliant. When they hear A - we can make you compliant and B - this is nowhere near as bad as you thought it was, there’s a huge relief you can see, and the strain lifts. Particularly in the SME sector, where it's bloody tough.

Matt
And you know, let's be honest about it, you're involved in tax every day. I'm involved in tax every day.  So we think that the whole world revolves around tax, and of course, doesn't.

But you know, particularly in SME land, the people running those businesses, they want to focus on running their businesses. And providing whatever goods or services those businesses provide at the highest level that that they can. And that's what they should be doing.

Access to expertise

Matt
They shouldn't be sitting at home at night worrying about death and taxes as you say. And you know, to be able to provide a service to them that takes them  away from that, I think it's tremendously valuable.  And the other thing, I don't want to plug TMNZ services too much, I think it is worth the mention that ( I don't count myself among these people) but the people we have working at TMNZ are tax experts. So often what looks like a very complex and very difficult situation can be worked through to a very advantageous outcome for the taxpayer or for the business owners.

That's another thing that you get as a periphery benefit of using the tax pooling regime - you get access to those skills and that knowledge as part of the service, which again I think is something that along with remaining compliant, shouldn't be lost sight of when we when we actually look at the service that we provide.

TB
Yes, you're dealing with provisional tax regime, and even for an experienced practitioners like myself, we're always thinking “wait, what? Oh, hang on, that's over $60,000. Oops.”  It’s fantastic to be able to talk to your team and they'll come back and show different ways of dealing with the issue.

That seems a good place to leave it there. This has been a very enjoyable and very insightful conversation. Thank you so much for taking the time to join us. Any final thoughts?

Matt
No, it’s been my pleasure, Terry. Thank you for having me on. I know that my point of view is going to probably be quite a different to what you're used to on the tax podcast. So, thank you for giving me the opportunity. It's also been very fun from my point of view as well.

TB
Excellent. That's been great. Well, my guest today has been Matt Edwards, CEO of tax pooling company Tax Management New Zealand.

And on that note, that’s all for this week. I’m Terry Baucher and you can find this podcast on my website www.baucher.tax or wherever you get your podcasts.  Thank you for listening and please send me your feedback and tell your friends and clients. Until next time, kia pai to rā.