Hello and welcome to our first newsletter for 2017 – coming from our new premises at 41B Sussex Street! It's been a busy couple of months with both moving and upgrading all our computer equipment but we're now settled and looking forward to the new financial year.
If you haven't yet visited our new office, please be sure to pop in next time you're driving past. Parking is in the driveway right in front of the office.
Please note that this newsletter contains information regarding major tax changes which may affect you so please read this newsletter to ensure that you are informed of these changes.
Important Upcoming Tax Dates
By now, those of you who have an extension of time should have received your 2016 terminal tax notices. Thistax is due on the 7th of April.Don't forget that if you are sending a cheque, it must be received by the 7th so get it in the post in plenty of time!
We'll also be emailing out the tax notices for the 2017 final provisional tax instalment shortly (payment due on the 7thof May). Please make sure you look out for these in your inbox.
If paying either of these taxes by the due date is not possible, please don't stress! Get in touch with us as soon as you can so we can either set up a payment arrangement with Inland Revenue or buy your tax from Tax Management New Zealand.
For those of you who are GST registered and your returns are aligned with a 31st of March balance date, your due date for filing and payment will be the 7th of May. Note that this is our busiest time of the year so please get your information to us as soon as you can to ensure we can meet the deadline.
Additional requirements for 31st March
- Record your debtors (people who owe you money) as at 31 March 2017.
- Record your creditors (people you owe money to) as at 31 March 2017.
- Carry out a stock take, if you carry and sell stock. Stock needs to be valued at the lesser of cost or market value so take this opportunity to review the appropriate valuation for the goods you are holding. You should make a note of all the stock items and the cost of each (GST exclusive). The total is counted as your closing stock. The stocktake is important too for performance monitoring and income tax purposes. An inaccurate stocktake will result in an incorrect cost of sales figure, which impacts on the perceived value of your business and on the tax you pay. So the closer it is done to balance date, the better!
It's that time of the year again when school fees and donations are being paid. Don't forget you can claim a 33% rebate on these donations (as well as donations to most charities), so please remember to include these in your receipts if paid by the 31st March 2017. Note that activity fees and some levies imposed by schools are not claimable so we must have your receipt to ensure we are only claiming the donation part of the payment.
Importation of goods
People who are importing goods MUST keep all invoices from freight forwarding companies. These invoices provide the only breakdown of the GST, duty and freight on these goods, and without them you may be missing out on significant GST claims. It would be appreciated if you could please send this information to us as soon as you receive it, in case it gets misplaced or overlooked. For those of you completing your own GST returns using MYOB or Xero, there are specific ways to deal with customs GST which is not particularly obvious, so please contact us in this instance to ensure that you are claiming it correctly.
ACC Cover Plus Extra
The start of the new financial year is the ideal time to review your ACC cover. Our view is that all self-employed contractors should be on Cover Plus Extra NOT the standard Cover Plus that most of you are on. So please review your policy and make the switch if you haven't already. It costs no more than the standard cover and the main advantage of it is that it provides guaranteed cover – you don't have to prove your income at the time of your accident, which can be a real issue for those who receive fluctuating income from a variety of sources.
For those of you who also have Income Protection Insurance, it's likely that you are doubling up on your cover and paying considerably more than you need to. Cover Plus Extra gives you the ability to reduce your ACC premiums down to a minimum and rely on your Income Protection policy to cover you if you have an accident. If you are unsure as to whether your Income Protection policy covers accidents, we recommend that you talk to your broker or insurance company. If you need assistance here, we can put you in touch with insurance brokers who would be happy to help you.
Withholding Tax Changes
The first of April sees a couple of major changes to the Withholding Tax Regime. For our sole trader, film industry clients and builders, there will be no changes. However, the rest of you please note:
- Sole traders in industries not included in the compulsory withholding tax regime can now elect to have withholding tax deducted from their pay. This will allow you to pay tax as you earn and will remove/reduce the requirement to pay provisional tax moving forward. You can elect to have tax deducted at any rate above 10%.
- People contracting through companies to Labour Hire Companies/Temping Agencies will now be required to pay 20% withholding tax on their income. The company can apply for a 0% special tax rate – however, we are uncertain as to how successful you are likely to be. Please let us know if you would like our assistance here.
Other Pending Changes
We understand that IRD are considering changes to how we claim for home office and how company vehicles will be treated moving forward. This legislation, if it does come in, will be effective almost immediately, so we are keeping a close eye on this and will let you know if any of these changes are likely to affect you.
Many you have big mortgages which you are keen to pay off as quickly as possible and have approached us for help in achieving this. We have tools available to assist you with this, so please call or email us if you think that we can be of assistance.
Beware if you rent your house on Bookabach or AirBNB
Most house and contents insurance policies stipulate that your house is only used for private purposes. Renting your house, or individual rooms within your house, may breach the conditions of your insurance policy, giving the insurance company a reason not to pay out, should you make a claim. We recommend that you contact your insurance company if you are in this situation to ensure that you have the appropriate cover.
The same may apply if you work from home and have contractors and/or clients frequently visiting. Once again, we recommend you speak to your insurers if this is the case.
Companies Office Requirements
We have been informed that the Companies Office are continuing to spontaneously visit registered offices to check whether their requirements with regards to record keeping are being adhered to. Non-adherence is being met with hefty fines. We have recently invested in software which, for a small annual fee will ensure that all requirements are met. We will be offering this service to all our companies over the next couple of months. However, in the meantime, if you do hear the Companies Office with regards to checking your documentation, please urgently let us know as we should be able to assist you.
We are very pleased to advise that Karen is returning from maternity leave on the 3rd of April – just in time for GST! As she will be initially returning on a part-time basis we will be taking the opportunity to re-balance the workloads of all the accountants through our very busy period, so please don't be alarmed if you hear from a different accountant than you normally deal with.
The team at Tyler Price would like to wish you all a very happy and relaxing Easter. As always, we look forward to assisting you with any queries you may have coming up to the end of the financial year, and we are only too happy to be able to help.
From the team at Tyler Price – Isobel, Abbey, Bryony, Caroline, Karen, Virginia and Tilly.