Inland Revenue have released an interpretation statement on this one recently. Next time you grab a coffee or a meal at your local café in between back-to-back client meetings and think about claiming this as an expense because you are self-employed and it’s just part of your work day, think again. New Zealand’s Inland Revenue has confirmed that these expenses are not deductible for self-employed taxpayers in all but very… Read more
A lot of people this year are finding that once their income tax assessment has been calculated automatically they end up having tax to pay – and suddenly it’s panic stations! (Don’t worry, this happened to me and I did the same!). There may be a reason for it! In the Financial Year Ended 31 March 2021, there were 53 weekly pay periods, as opposed to 52 weekly pay periods.… Read more
The increase of the minimum sick leave entitlement from 5 days per year to 10 days per year will come into effect on 24th July 2021. What does this mean for you and your employees? For existing staff they will get the increase of entitlement on their next sick leave anniversary (not automatically on 24th July) For new staff they will get this on their 6 month anniversary The maximum… Read more
Some of you may have realised that Xero has instigated compulsory Multifactor Authentication for logging into their software. You can either use a generic authentication app or Xero have made their own app to help with this. Xero Launches Xero Verify Xero has launched its own authentication app, Xero Verify, to give small businesses world-class data protection. The new app makes it easy for users to set up multi-factor authentication… Read more
This is something we hear a LOT! Along with the old myth about only paying tax once you earn more than $5,000… It’s important to understand the differences between a hobby and a business. A small side hustle you’ve been doing for years could actually be a business for tax purposes, and you may be accumulating tax debt without realising it. A hobby is generally something you do in your… Read more
Anyone with staff knows the frustrations that the complexities of the current Holidays Act legislation creates. The Government set up a Taskforce to review the Holiday Act in May 2018, which was made up of employer, employee and government representatives. There was widespread non-compliance with the Holidays Act 2003 and it was generally accepted that this is due to issues with not only the legislation, but the implementing of the legislation… Read more
In December 2020, the NZ Government passed legislation to implement a new personal tax rate of 39% for those with personal incomes above $180,000. This new rate comes into effect from 1 April 2021 (the 2021-2022 income year). What You Should Know As with any changes in tax, there are knock-on effects that you should know about. These include: New Fringe Benefit Tax rate of 63.93% for all-inclusive pay of… Read more
The End Of Financial Year is always such a busy time with a LOT to think about as a business owner. We have share some important things for to consider as a reminder: Dividends (Companies) If you have a Limited Liability Company and there are retained earnings in the Company, you may want to look at paying out a dividend this year (prior to the potential personal tax rate increase). … Read more
This week the Government has announced proposed changes for residential property acquired on or after 27 March 2021. The proposed changes include: extending the bright-line test to 10 years amending the main home exclusion which would require tax to be paid on gains made for periods the property is not used as the owners main home allowing newly built homes to use a 5 year bright-line test not allowing property… Read more
Another end of Financial Year is looming up fast! And what a crazy year it has been. There are quite a few different updates that are due to rollout on 1st April, so we have summarized them here for you: Minimum Wage Increase: From the 1st April 2021, the minimum wage hourly rates will increase to: Adult: $20.00 Starting out/training wage: $16.00 This will effect quite a lot… Read more
Fixed Assets On 17th March 2020, the government announced that for one year, any assets purchased for a business under $5,000 (exc GST) can be expensed in the year it is purchased. This means the full cost of that asset can be claimed as a deductible expense in that period. As this was only a short term adjustment, this is due to finish on 16th March 2021 (yes next week)… Read more
This year, Waitangi Day falls on Saturday 6 February and is observed on that day or Monday 8 February. Here is what you need to know about rights for employees and obligations for employers. Mondayisation for Waitangi Day This year, Waitangi Day falls on a Saturday. This means the holiday is moved to the following Monday, which is Monday 8 February. Requirement to work on Waitangi Day If your employee… Read more
Sometimes, an employee doesn’t have enough leave available to take paid leave when time off work is required for what would normally be a work day. As am employer, you can agree to the time off and not pay them for this time. This is usually called Leave Without Pay or LWOP. Leave without pay doesn’t end an employee’s agreement or change it, however, did you know that leave without… Read more
While we are all planning our next steps as we rebuild our businesses, the Ministry of Social Development (MSD) have begun the mammoth task of auditing certain applications made under the wage subsidy scheme. This is an action that was signalled from very early on in the scheme. While the swift move into audit phase may seem harsh, the statistics that emerged regarding fraudulent claims on hardship grants after the… Read more
From 1 July 2020, the duration of parental leave payments will extend from 22 weeks to 26 weeks and the maximum weekly rate for eligible parents will increase from $585.80 to $606.46 gross. The minimum payment rate for self-employed parents increases from $177.00 to $189.00 gross per week, which is equal to 10 hours of the current adult minimum wage. The number of ‘Keeping in Touch’ days will also increase… Read more
Have you received the latest update from Inland Revenue with ways you can now pay your tax? Read on to find out more… No more cheques – pay online instead From 1 March 2020 IRD will stop accepting payment by cheque, including cheques dated after 1 March. The safest and quickest ways for you to pay tax is online – either in myIR or through your bank. For more information on… Read more
As Christmas draws closer, here’s a quick list of five things as an employer you should be aware of when it comes to minimum legal employment rights. 1. Is closing down a workplace at Christmas legal? Yes. An Employer may close down a workplace if the processed is managed lawfully. Employees must be given at least 14 days’ notice of the closedown. An employer may have a regular closedown once… Read more
IRD is looking hard at tax crime in the building sector – are you declaring all your income? Have you had a customer ask for a cash discount? You know – so it doesn’t “cost as much” because it doesn’t have to go through the books. Who really pays for that discount? Tradies around the country who do undeclared cash jobs, discounted for their mates or simply to give the… Read more
So you’re ready to hire your first employee, congratulations! You’ve had subbies working for you for years, so what’s the big deal? Most tradies will one day find themselves in the position that they’ve got a good crew of guys who do an awesome job and they want to keep them happy. This awesome crew might still subcontract back to the head contractor (the business owner), which is always a… Read more
The minimum adult wage is set to increase by $1.20 per hour in April. Are you prepared?