Inland Revenue Error Results in Thousands of Pensioners Being Overcharged

Inland Revenue has confirmed that almost 7,000 pensioners were affected by a system error that wrongly charged them ACC levies on income that should not have attracted them.

The issue, identified earlier this year, involved the department’s tax return software incorrectly recording New Zealand Superannuation (NZ Super) earnings for ACC levy purposes. Under current rules, NZ Super is not liable for ACC earner levies, but the error meant some pensioners were charged levies they did not owe.

What Happened

According to Inland Revenue, 6,778 customers had their returns populated with incorrect information about earnings that are not liable for levies. The department fixed these returns in July 2025 once the issue was identified.

One pensioner described being charged more than $300 in ACC levies on NZ Super income of nearly $19,000. The individual did not spot the mistake until after submitting their tax return, showing how the pre-populated data could mislead people who were unaware of the levy rules.

Concerns From the Public and Experts

Some affected pensioners have said they want assurance that Inland Revenue has taken strong steps to prevent similar errors in future returns.

Tax professionals have also commented on the wider implications of automated systems. A tax leader from Chartered Accountants Australia New Zealand said that while digital tools like myIR can make tax filing easier, mistakes “when they go wrong” can be hard for ordinary taxpayers to detect without specialist knowledge.

Another accounting expert raised concerns that errors in pre-populated data could reflect deeper issues with change control in Inland Revenue’s systems.

Broader Context

This recent situation follows other tech-related problems at Inland Revenue. Last week, thousands of taxpayers were reported to have overpaid taxes because their imputation credits were incorrectly recorded in pre-populated tax forms.

Some taxpayer advocacy groups have called for meetings with Inland Revenue to get more detailed explanations about these errors and the steps being taken to protect taxpayers from incorrect assessments. Taxpayers’ Union

What Pensioners Should Do

If you believe you have been affected and have not yet been contacted, it is a good idea to:

• Check your latest tax return and ACC levy details through myIR.
• Contact Inland Revenue through their official support channels if you spot errors. ird.govt.nz

Errors like this highlight the importance of checking pre-populated information before confirming returns, especially for incomes not subject to levies like NZ Super.