From smallest to largest
New data from Inland Revenue shows Tax Traders has become the dominant player in Aotearoa’s tax pooling sector.
The data shows that Tax Traders has facilitated more transactions than any other provider during the most recent tax year - enabling significant interest and penalty reductions for New Zealand provisional taxpayers based on Inland Revenue’s standard settings.
Founded in 2012, Tax Traders’ early days were marked by disruption, innovation, and a strong focus on purpose. At the time they entered the market, there was one dominant player and five other competitors. However, the Auckland-based firm has since grown from the smallest to the largest trader of income tax in the industry, significantly expanding the overall sector in the process.
Why does this matter?
Value-added tax pooling transactions are a key indicator of the financial benefit a tax pooling provider can deliver to taxpayers who miscalculate their provisional tax payments. Provisional tax is paid based on a forecast of expected profitability, meaning it can be difficult to get right and expensive if taxpayers get it wrong.
New Zealand’s tax pooling framework, which has been in place since 2003, allows taxpayers to mitigate this risk by depositing provisional tax into a commercial provider’s pool account at IR. Payments deposited with a tax pooling provider sit in an account at IR until a taxpayer finalises their tax position.
If a taxpayer overpays, they can sell their surplus to another who has underpaid, with Tax Traders facilitating the transaction between buyer and seller at rates more favourable than IR’s standard credit (currently 3.27%) and debit (9.89%) interest rates.
This system reduces compliance costs and improves cash flow for businesses.
How much benefit does Tax Traders deliver in a year?
Using IR’s standard interest and penalty settings as the basis for calculation, taxpayers transacting through Tax Traders achieved more than $45 million in reduced exposure during the 2024 tradable period - across both those who overpaid and those who underpaid.
“This milestone reflects more than just the largest volume of value-added tax pooling transactions - it’s proof that our approach works,” says Josh Taylor, Co-Founder of Tax Traders.
“From starting at a kitchen table to becoming New Zealand’s leading tax pooling provider, we’ve stayed focused on making the benefits of tax pooling accessible to all taxpayers, changing how people think about business, and showing that profit and purpose can grow together. By improving cash flow and delivering better outcomes for provisional taxpayers, we’re helping Kiwi businesses thrive.”
About Tax Traders
Tax Traders was established to make tax pooling accessible to all. Through its advanced platform and flexible payment options, it has grown to become New Zealand’s most preferred tax pooling provider, supporting thousands of businesses and advisers across the motu.