Photo: www.stockmonkeys.com
Most organising advice on the subject of paper comes from American experts. It is the job of the American public to live in abject fear of the Internal Revenue Service (IRS). And rightly so I’d say, based on my brief brush with them.
New Zealand’s Inland Revenue, by contrast, is a cuddly teddy bear that just wants what’s best for you. It recognises the value of a clear conscience and a good night’s sleep, which is why it is very keen for us to declare all our income and pay our taxes.
OK, maybe they have other motivations, but they have been trying to make tax a bit less painful. If you dream of a paperless life, here are the three biggest changes Inland Revenue has made to help you out.
Electronic documents
If you have a myIR account, you will start receiving e-mail notifications when a new document is issued, instead of a mailed letter. Log in to myIR to view or download your documents as far back as April 2010—yep, they’ve even saved us the trouble of scanning our old statements.
Inland Revenue estimates this change will save them 16 million A4 sheets of paper, plus 7 million envelopes, a year, and it’s great news for us too. These documents are from our most important paper-shuffling partner, and we all live in irrational fear of destroying or losing them. Not any more.
Supporting cloud computing
With cloud computing, both the software and your data live on the software company’s servers, and you access them via the internet. You never have to install software, upgrade it, or even back up, and your data is available anywhere you can get online.
Serious cloud computing providers (like the beautiful New Zealand-made Xero accounting software) use the best server facilities money can get. They’re fast, reliable, secure, have multiple fail-safe systems, are staffed round the clock by teams of experts…and are usually located overseas. Our laws require tax records to be kept in New Zealand, so this is a problem. However, Inland Revenue has given approval for specific companies, including Xero, MYOB, and Reckon, to hold their customers’ data offshore. Problem solved.
Bye bye paper
Perhaps the biggest clutter-killing change Inland Revenue has made is documented in SPS 13/01.
Eh?
Standard Practice Statement 13/01 explains the IRD’s policy on electronic documents. The catchy title and wordy content (read it here if you dare) belie its importance. This is huge. In as few words as possible: for tax records, digital files are just as good as paper. If you’ve got an electronic original, or a scanned copy of a paper original, then you don’t need the paper.
I’ll say that again. You don’t need the paper.
Of course, the electronic document needs to be accurate, complete, unadulterated, and accessible. Just use your common sense. Make a good quality scan, store it as PDF, keep it in a cloud-based file storage system (like Dropbox, OneDrive, or Google Drive) that makes backups for you, and you’re golden.
None of these changes are going to reduce your taxes, or make you enjoy paying them. Sorry about that. But they will all reduce your clutter and confusion, and free up valuable space. So you see, Inland Revenue does love you and want you to be happy. Really. Now, about that overdue tax bill…