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Reply To: I received a resurgence payment.  Can you please tell me where to assign the Credit amount in my accounting software?  I am picking it is not classified as income.  Would be most grateful for your advice.  

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https://www.ird.govt.nz/covid-19/business-and-organisations/resurgence-support-payment/apply

On that page “Payments received under the RSP are not subject to income tax. Expenditure funded by payments under the RSP is not deductible.

GST-registered businesses will return GST on payments received under the RSP. These businesses will be able to claim input tax deductions for expenditure funded by payments under the RSP.

The payment must be used to cover business expenses such as wages and fixed costs.”

In the accounting system, i would recommend you to start a new account line to display such an item. I would suggest this line to be classified as “income”, as it is considered non taxable income but the corresponding expenses are also non deductible. Reasons being 1. It allows GST to be accurately accounted for, if any. 2. for comparative reasons you will know in the future that this item is non-repetitive (fingers crossed!) and you can clearly identify your income movement for the next year. 3 Your accountant will be able to speedily spot this item to ensure they apply the correct tax treatment

Best
Nelson