Do You Pay Yourself From Your Business? (Spring 2016)

Do you take regular cash drawings from your business profits to meet personal living costs? You need to be aware of how your personal drawings sit with your tax position. Sole traders Sole traders complete an IR3 tax return at the end of the year. Include all business income and expenses in your tax return. This includes drawings. They are not a deductible business expense. It’s much easier to track…  Read more

Provide GST Registration Details to Remote Vendors (Spring 2016)

From 1 October 2016 non-resident businesses must charge and return GST where they meet the criteria to register for GST and they supply remote services (including online services) to New Zealand residents. As a New Zealand resident business, you won’t be charged GST on these supplies, if: you are GST-registered the supplies are part of your taxable activity, and you let the non-resident supplier know you’re GST registered and provide…  Read more

Enforcing Employment Standards (Spring 2016)

It is taking time for the impact of this year’s employment law changes to sink in. Parental leave and the demise of zero hours contracts received a lot of press. Enforcing employment standards has had some coverage but always sounds a bit abstract in comparison. Yet this is an area that seems to bite employers. The basic idea is to make sure employers pay at least minimum wage and give…  Read more

Budget Perspective (Winter 2016)

No drama The 2016 budget has come and gone and the only people really shouting about it are the Opposition and the tobacco companies. Perhaps the Government felt they have already given businesses enough to be excited about with their pre-Budget announcements of the proposed tax simplification and business transformation. Beyond the reform of the provisional tax system and other changes announced to be staged over 2017 and 2018, there…  Read more

Changes to Land Sales Could Affect You (Winter 2016)

Are you selling residential land? From 1 July 2016, a new withholding tax – residential land withholding tax (RLWT) – may need to be deducted from a property sale/disposal. This will occur where the property being sold/disposed of is in New Zealand and meets the definition of ‘residential land’, and the vendor: acquired the property on or after 1 October 2015, and has owned it for less than two years…  Read more

Tax Pooling (Winter 2016)

Underpaid income tax? Underpaid provisional tax can cause a few headaches. Maybe you did not keep up with your provisional tax payments throughout the year? (oops) Perhaps you did not end up paying enough because you had a better-than expected financial year (yay! but damn, an increased tax liability). It could be that seasonality or volatility make it difficult to forecast your provisional tax payments. Whatever the case, owing the…  Read more

Don’t be caught out on Holiday Pay! (Autumn 2016)

Holiday pay has been in the news recently and we know the Labour Inspectors from the Ministry of Business, Innovation and Employment will be checking that other employers have been recording and paying entitlements correctly. There are two ways of calculating holiday pay: it can be based on ordinary weekly pay at the beginning of the holiday; or average weekly earnings over the previous 12 months The correct amount of…  Read more

Employment (Autumn 2016)

The Employment Standards Legislation Bill has been passed, bringing into effect from 1 April 2016 some important changes to the employment statutes. These include extending parental leave, spearing zero hour contracts and strengthening compliance with minimum employment standards. Parental leave A greater range of people – for example, certain casual workers and seasonal workers, employees with more than one employer and those that have recently changed jobs – will have…  Read more

Requesting ACC Adjustments (Autumn 2016)

Do you receive PAYE or Shareholder Remuneration that exceeds the maximum earnings liable for ACC?; or Are your earnings sourced from one or more companies? If so, we can request that ACC reassess your liability and make a Multiple Employer Adjustment. This may affect how much you pay in ACC levies. ACC cannot identify eligible customers from the information Inland Revenue provides, so levies are charged on all income. ACC…  Read more

News From ACC (Autumn 2016)

No more residual levies From April, employers, earners, and motor vehicle owners no longer have to pay residual ACC levies. However it won’t mean reductions across the board. The residual levy rate calculation was based on old injury rates which have become out-dated, going back 10 years or more. The residual levies themselves were a kind of catch up to make sure there were enough funds set aside to pay…  Read more

Safeguard Your Business (Spring 2016)

We have long known we’re a nation powered by small business. And that lends itself to highly personalised ways of doing business, strong relationships going back a long way, teams that feel like family. That’s why it’s so devastating when a business finds out someone they’ve trusted has cheated them, sometimes over a long time: a so-called ‘person in a special relationship’. There have been a number of high profile…  Read more

Setting the Record Straight (Autumn 2016)

Inland Revenue have signalled they will be looking at businesses’ record keeping systems. Key targets will be that all jobs and all income are being recorded and that GST is being handled properly. Recent prosecutions indicate that PAYE records are another hot topic, along with the corresponding employment records. If sketchy records are a quick way to set off the IRD alarm bells, this could be a great time to…  Read more

Targeting the Cash Economy (Autumn 2016)

Inland Revenue’s crackdown on ‘cashies’ continues with their focus on undeclared cash in the construction and hospitality sectors. Last year, the Auckland region saw the most activity. Inland Revenue are now widening their reach. They’ve been trying to change attitudes among tradies and subcontracting businesses and their efforts seem to be getting results. Inland Revenue acknowledge people trying to cheat on tax are in the minority but stress that they’re…  Read more

Foreign Superannuation Withdrawal Amnesty (Summer 2015)

Have you ever had a Foreign Superannuation Scheme and withdrawn funds or transferred funds from this? Did you account for New Zealand tax on these funds? If you have answered YES to the first and NO to the second question, you should be talking to us about using the Inland Revenue amnesty, which runs out on your 2015 income tax return. If you withdrew or transferred funds at any time…  Read more

Sensible Seasonal Housekeeping (Summer 2015)

If your business peaks during the holidays, have your marketing organised and plan your staffing. – Is there a planned approach to when everyone is taking their holidays? Have extra business cards or other marketing giveaways on hand – it’s a great season for networking. Magnetic car signs can attract enquiries as well Everyone is used to being cash strapped in the New Year but no one ever really prepares…  Read more

IRD Numbers for Property Sales (Summer 2015)

All vendors and purchasers of property other than their main home must now provide an IRD number as part of the land transfer process. Non-residents Offshore buyers must provide a New Zealand bank account number before they can obtain a New Zealand IRD number. And all non-resident buyers and sellers must provide their tax identification number from their home country, along with current identification requirements such as a passport. Family…  Read more

Health and Safety (Spring 2015)

The Health and Safety Reform Bill, which started its slow progress last year, took another step forward in late July with its second reading in Parliament. Meanwhile, tragically preventable accidents, particularly in high risk sectors such as quarrying, forestry, farming, manufacturing, transport and construction, keep the pressure on for better safety outcomes. The lengthy gestation period of the proposed legislation has aggravated employer uncertainty about the implications of the proposed…  Read more

New Property Tax Rules (Summer 2015)

New legislation affects property sales made from 1 October 2015 onwards. The changes hit in a variety of ways. Bright-line test and residential land New tax rules now apply to residential property sales made from 1 October 2015. A new ‘bright-line test’ will apply where a person who has purchased a residential property on or after 1 October 2015 then sells it within two years. The sale will be taxed…  Read more

Employment Standards (Spring 2015)

The Employment Standards Legislation Bill has been introduced to parliament, proposing changes to strengthen enforcement of employment standards. This will introduce tougher sanctions for breaches and greater accountability for people and entities associated with the employer – such as directors, senior managers, legal advisors – if they are knowingly involved when an employer breaks the law. The changes target unfair practices such as unreasonable deductions from employees’ wages; or where…  Read more

Double Tax Agreement with US (Spring 2015)

Are you a US citizen living in New Zealand? If so, your income is subject to both USA and New Zealand income tax requirements. The United States tax system requires its citizens and its resident aliens to report their worldwide income to the US Internal Revenue Service (IRS) regardless of where they live. However, if you are a New Zealand tax resident, your New Zealand tax return is likely to…  Read more

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