Hawkes Bay Anniversay Day

A quick reminder that tomorrow, 24 October 2014 is Hawkes Bay Anniversary day so we'll be closed for the day - and of course Monday too for Labour day. Hope you have a great weekend - have fun and stay safe! More

Topics: Kiwitax News

Posted 23/10/2014

Which Costs Are GST Exempt?

When preparing GST returns do note not all expenses have a GST component. Here's a quick list of the most common GST exempt outgoings... Bank Fees Interest Loan Fees Wages Drawings Credit Card Commission Non Deductible Entertainment Suppliers that are Not GST Registered Income Tax, GST Payments, PAYE Payments Inland Revenue Penalties Resident Withholding Tax on Interest Earned Incom... More

Topics: GST Claimable Expenses Record Keeping

Posted 22/10/2014

Can I Pay my Spouse / Partner Wages from My Business?

If you trade as a company there is no problem in paying your spouse or partner wages through the payroll of your business - however if you trade as a sole trader or partnership (that doesn't have your spouse / partner as an owner) you will need Inland Revenue approval to do this. If you don't get approval Inland Revenue can disallow any wage payments from being a tax deduction for your business. ... More

Topics: Claimable Expenses Employing PAYE Salary & Wages

Posted 21/10/2014

How to Maximise Your Entertainment Claims

To ensure you're making the best claims for your entertainment costs here's how to code them correctly. Entertainment expenses fall into two categories - either 100% or 50% claimable. If you are entertaining clients, suppliers, employees and only pay for yourself - the cost is 100% deductible If you are entertaining clients, suppliers, employees and pay for all people - the cost is 50% deducti... More

Topics: Claimable Expenses Record Keeping Entertainment

Posted 16/10/2014

Claiming Website Development Costs

There is a distinction between what is an asset and what is an expense when it comes to your business website. The costs of obtaining the domain name and the initial build of the website are an asset - so can't be claimed fully in the year that the costs were incurred. There is depreciation claimable on the website meaning the tax expense claims get spread out over a few years. Any on-going costs ... More

Topics: Claimable Expenses Depreciation Accounting Record Keeping

Posted 16/10/2014

Current Income Tax Rates

We often get asked what the actual tax rates are for individuals and business. As at October 2014 these rates apply: Company Tax Rate 28% Trust Tax Rate 33% Individual Tax Rates $0-$14,000 10.5% $14,001-$48,000 17.5% $48,001-$70,000 30% $70,001 + 33% For basic income tax estimations try the Income Tax Calculator or contact us if you have any questions. More

Topics: Income Tax Tax Returns PAYE

Posted 15/10/2014

Income Protection Insurance Deductibility

Many people have Income Protection insurance policies - these are claimable in your personal income tax return (whether you are in business or in paid employment) as long as any proceeds upon making a claim are treated as taxable income. Usually your insurance company will send out a letter after the end of each financial year detailing the amount you've paid on your premiums and the portion that... More

Topics: Income Tax Claimable Expenses Record Keeping Tax Returns

Posted 8/10/2014

Tips for Buying a Rental that Needs Maintenance

Often people buy a rental property that needs a bit of work done to it - they then get the keys and undertake repairs and maintenance that can cost a few thousand dollars. The property is then looking all good and they put it to the market to find a tenant. In this instance all of the costs to repair the property will be capitalised - added to the purchase price of the property - no tax claims av... More

Topics: Claimable Expenses Rental Property Depreciation Record Keeping

Posted 1/10/2014 – Updated 7/10/2014

Due Dates for October 2014

PAYE: 1 Monthly PAYE return and any payment for September is due 20 October. GST: 1, 2 and 6 Monthly GST returns and any payments for period end 30 September are due 28 October. Provisional Tax Instalment: For provisional tax payers who pay twice yearly (often are 6 monthly GST registered) the first instalment for 2015 Provisional Tax is due 28 October. Any questions please ask. More

Topics: Due Dates

Posted 1/10/2014 – Updated 16/10/2014

Claiming for Using Your Home as an Office

When running a business from your home you are entitled to make a claim for the costs associated with this. Inland Revenue require you to determine the office area as a percentage of your whole home for these claims. To work this out you need to create a plan of your house (if you haven't one already) to calculate how many square metres it is in total - then work out the total square metres used ... More

Topics: Claimable Expenses Business Record Keeping Tax Returns

Posted 30/09/2014

How Much Can I Pay Myself from My Business?

People often ask if there's a general rule about how much they can take from their business as 'wages'. Our suggestion is to work backwards, especially when you are still in the early stages of business where cashflow is a bit up and down. If you can ensure there is enough money in the bank account to pay all business costs, loan repayments and you're putting some money aside for income tax and GS... More

Topics: Business Salary & Wages Drawings

Posted 29/09/2014 – Updated 30/09/2014

Claiming on Meetings at Cafes & Restaurants

Sometimes you might take employees, clients or prospective clients out for breakfast, lunch, dinner or a coffee and muffin to discuss work related matters and pay for it all. IRD allow you to claim 50% of these costs as an entertainment expense. If you are GST registered you can only claim 50% of the total cost for GST and also 50% for your annual accounts and income tax. As good record keeping p... More

Topics: Claimable Expenses Record Keeping Employing Entertainment

Posted 26/09/2014 – Updated 16/10/2014

What is a Dividend?

A dividend is an allocation of profits from a company to its shareholders. In small businesses it usually works like this - a company has made a profit for the year and paid income tax on that profit at the company tax rate of the time (currently 28%). The shareholders have not yet had the use of this money. When the shareholders decide they'd like to withdraw this money from the company a divid... More

Topics: Income Tax Shareholders Tax Returns Terminology Company

Posted 25/09/2014 – Updated 30/09/2014

What is Better - Drawings or Wages?

Clients often ask which is the best way to pay themselves from their company - drawings or wages? Here is an explanation of the differences. Drawings Taking drawings from your business is not a tax deductible cost - you should be aware that you will need to put aside a bit of money for income tax as well. For example say you take $800 per week drawings you want to be saving at least an additiona... More

Topics: Employing PAYE Salary & Wages Drawings KiwiSaver

Posted 24/09/2014 – Updated 25/09/2014

What is Provisional Tax?

When you first go into business you don't actually have to pay any income tax to IRD for quite some time (unless you are going to be earning over $180K in profit for your first year - then different rules apply). So say your first financial year will end at the 31 March 2015 - then your financial accounts and returns are prepared and any income tax payable for that year is due to Inland Revenue b... More

Topics: Income Tax Terminology Provisional Tax Starting Business

Posted 23/09/2014 – Updated 30/09/2014