Employee (IR348-EMS) and Individual Tax Returns (IR3, IR7, IR4S)

Owned by Philip Stevens
Last updated: Aug 04, 2021
3 min read

Purpose

Detailed employment data in the LBD is sourced from IR data, collected as part of the tax administration system. Until 2015, these were processed by Statistics NZ and provided to researchers in the LBD as aggregated firm-level employment data, generated through the LEED processing system. From 2015 onwards, this aggregation has been discontinued, with researchers instead provided with access to the underlying individual level data –the Employer Monthly Schedule (EMS), Company Shareholder Details (IR4S), Income Tax Return for Partnerships (IR7/IR7P), and Individual Tax Return (IR3).

Content

Fabling & Mare (2015a) provides a detailed description of these data and a methodology for using the annual and monthly tax information together to generate monthly estimates of headcount and full-time equivalent employment, and annual estimates of working proprietor labour input. These data are available in ibuldd_research_datalab as tables pent_year_L_IDI_YYYYMMDD and pent_pbn_month_L_IDI_YYYYMMDD, where YYYYMMDD refers to the IDI instance the tables are based on.

Coverage

The EMS is a mandatory monthly reporting requirement for all employing firms. We assume that the absence of employment data implies zero employees on the grounds that personal income tax non-compliance is likely to be negligible in the population of firms that meet the mandatory GST filing threshold. Annual income tax returns are mandatory for the relevant types of businesses and individuals. IR3s are required of individuals who earned income other than salary, wages, interest, dividends and/or taxable Māori authority distributions. The IR4 (and IR4S) is required from all active New Zealand resident companies. The IR7P is required from all partnerships.

(From: Richard Fabling and Lynda Sanderson (2016) 'A Rough Guide to New Zealand's Longitudinal Business Database (2nd edition)')

IR 348 - Employer monthly schedule

IR348 EMS form

IR335 Employer’s Guide (2020)

IR3 - Individual income tax return

IR3s are required of individuals who earned income other than salary, wages,interest, dividends and/or taxable M ̄aori authority distributions.

The IR3 form (2021):

The IR3 Guide (2021)

Guidance on the IR3 on the Inland Revenue website:

https://www.ird.govt.nz/income-tax/income-tax-for-individuals/what-happens-at-the-end-of-the-tax-year/individual-income-tax-return---ir3

IR4 Company tax return

The IR4 (and IR4S) is required from all active New Zealand resident companies.

IR4 form (2021)

IR4S - Company shareholders' details form (2021)

IR4 Guide (2021)

IR7 Income tax return: Partnerships and look-through companies (LTCs)

Every partnership or look-through company (LTC) must complete an IR7 return showing their total income after expenses and attach either the Partnership income/loss attribution - IR7P or the Look-through company (LTC) income/loss attribution - IR7L.
The partnership or LTC is not assessed for tax, but each partner or owner is liable for tax on their share of income from the partnership or LTC.
Each partner or owner must complete an individual tax return showing all income, including their share from the partnership or LTC.

IR7 Income tax return form (2021):

IR7P Partnership income/loss attribution form (2021):

IR7P Look-through company income/loss attribution form (2021):

IR7 Guide (2021):