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Just how useful is the NZ Temporary Tax Loss Carry-Back Scheme?

It has its detractors, but is the Government’s tax loss carry-back scheme helping struggling NZ business owners?One of the responses to COVID-19 from the Government was a new temporary tax loss carry-back scheme.Some cynical commentators felt that the tax part of the SME Relief Package (of which the loss carry-back scheme was part) was more about political spin than providing real help to small businesses, so just how useful is the loss carry-back?The scheme enables businesses making a loss (w...

7 Key Considerations for Taking a Business Online

From figuring out what you do to goalsetting – here are your top priorities to help you hit the ground running. Starting and running a successful small business can be the most amazing opportunity to gain independence and build wealth, yet it can be very risky because of the high percentage of startups that fail. So if you’re an aspiring entrepreneur with a burning desire to break free of your wage slave bonds and achieve fame and untold riches, what should you be thinking about well before ...

Claiming Private Expenditure Despite the IRD!

Are you a business owner trading via a limited company? Did you know that you can legitimately claim for private goods and services paid for by your company? Yes you can, and it doesn’t matter what you claim - flights, a hotel bill, a present for your kids (or yourself), a new outfit - they’ll all OK. One small catch, the amount you spend cannot exceed $300 per quarter per owner - the exemption is not deducted first. Do bear in mind that  the threshold is $300 per quarter per employee o...

How to Exit Your Business

I meet many business owners who haven’t given a lot of thought to what their longer term plans are. Often they are continually bogged down in the daily routine and don’t take the time out to plan for the future. When I ask ‘what do you want to be doing in 5 to 10 year time’ often the answer is that they want to have exited their business, or at least be in the process of exiting. This quickly leads into discussions around what they think their business is worth, what they�...

Free Money - Come & Get it - If You Can! Research & Development Tax Credits

I’m bound to upset someone with this picture - pale, stale and male - but such is life!  Is it only old white boffin-like old guys that carry out research and development these days? No, most certainly not, there’s more around than you might think, and the New Zealand government is trying to encourage us to do more research and development by giving away yet more of our money. It’s surprising they have any left to give away! The incentive scheme for R&D has been around for some while ...

Fatal Mistakes to New Business Survival

In 37 years of advising new business owners the biggest single mistake that I keep seeing is to start a new business without having enough working capital to see them through to when the business is better established. The best form of working capital is cash in the bank. Borrowings can be OK (especially from family) but these are best kept in reserve. Five other mistakes are also often fatal. Break-Even Point. Unfortunately very few business owners know what their break-even point is. So simple...

Business Planning - Where is Your Business Now?

In order to get your business to where you want it to be you must first determine where it is now, as otherwise, you won’t know how much work you have to do to improve and nor can you set goals or action strategies, because firstly, the goals have to be realistic in achievability, (in other words, there is no point in setting a goal that is a bridge too far), and secondly, the action strategies you adopt should address the specific problems in your business you need to resolve. Here are some o...

Twelve Ways a Company Director can get a Criminal Record

Most people would think of tax as a way a director could end up in jail or with a criminal prosecution but in fact, there are another eleven ways a director could get a criminal record: Acts without a resource consent when one is required or does not comply with an enforcement order, abatement notice or water shortage directive;Pollutes, unlawfully disposes of trade waste or leaks, spills or releases harmful substances; or engages in misleading, deceptive or unconscionable conduct;Makes false re...

It's So Easy To Change Accountants These Days

It's a myth that it is difficult to change accountants these days. People think that it's too much hassle, it costs too much, you can't get the necessary information from your old accountant and your new accountant wouldn't know anything about your business or personal finances. Well, the good news is that it is no longer necessary to put up with mediocre service or rip-off fees. Changing accountants these days is easy because: 1. Your old accountant is obligated to supply any necessary informa...

10 Things to Do Before the Tax Year End

What should we be doing as business owners before our Balance Dates or tax year-end, depending on what type of business we are in? There's no point in paying any more tax than necessary. If you have trading stock (unless it’s clearly not going to exceed $10,000 in value) do a stock-take. Even if you have a perpetual inventory system on your accounting software you still need to check it’s accurate. Make sure you identify and write-off any unsaleable items or stock worth l...

Local Bookkeeper Exposes Rip-Off Accountancy Fees!

𝗜 𝗰𝗵𝗮𝘁𝘁𝗲𝗱 𝘄𝗶𝘁𝗵 𝗮 𝗹𝗼𝗰𝗮𝗹 𝗯𝗼𝗼𝗸𝗸𝗲𝗲𝗽𝗲𝗿 the other day who has loads of business clients. When it’s time to prepare the clients annual financials, to save her clients money and time, she prepares a year-end pack with all necessary supporting information (which is virtually the same for each client) and sends this off to the various accountants, wherever they may be. Despite the fact that the year-end information pack ...

Nick is fantastic to work with

Nick is fantastic to work with! His service, advice and free business classes are second to none. We really valued his input and direction in our early years of business. You won't regret partnering your business with Nick! Ang Low - Pick n Stick Designs...

The Joy of Tax in New Zealand

Did you know that the amount you can earn in Australia before you pay tax is now $18,200? Yes, an amazing $18,200 - that’s $350 per week, $700 a fortnight or $1,517 a month. Yes, the rates for higher levels of income may be more, but that's pretty damn good for the low or averagely paid, don't you think? In the UK, you can enjoy income of £12,500 before you pay any tax, unless you’re over 65, in which case the tax free amount is even higher. $12,500 is roughly NZ $25,000. Eve...

Business Planning - Bridging the Gap

Once you’ve established where your business is now and secondly, where you want to get it to, you need to sit down and work out how you’re going to bridge the gap between the two. If the gap is large, it may seem like where you want to get to is just too hard to reach. The answer here is to work backwards from your final goals, planning out the key milestones and benchmarks you need to attain in turn. Let’s take an example, a former client of mine who’s an orthodontist who wanted to grow...

Tax on Your KiwiSaver

One of the great things about Kiwisaver is that it can be drawn tax free when you reach retirement which is a very valuable benefit. It's unusual because normally, in New Zealand, tax is mostly worse than in other countries e.g. the complete lack of any personal allowance here whereby you can earn an amount tax-free, unlike Australia and the UK. However, Kiwisaver is not all tax-free. The contribution that your employer makes is taxable via an unpleasant little...

Tax Credits Going to Waste

The amount paid for tax credits under the Working for Families rules increased reasonably substantially last year (2018) and are now more generous than ever. The current income thresholds within which Working for Families Tax Credits are available are $84,500 for one child, $99,500 for two, $119,900 for three and $120,500 for four children.For those with a predetermined level of income from employment it’s easy to ensure you don’t miss out and receive the correct entitlement. For ...

Growing Your Business - Marketing

To get your business to where you want it to be from where it is now, you need to bridge the gap by planning in four key areas - marketing, operations (or your day-to-day business activities), human resources, and management control. Your marketing plan should cover five key areas: Your marketing objectives. It’s necessary to set very clear and measurable goals when drafting your marketing plan which dovetail into your overall business plan and ensure you get to where you want to be. For examp...

Which Accountant Should You Use?

There are a number of factors that business owners should take into account in deciding which accountant to use: Relationships. It’s important that you choose an accountant that you can get on with. Do they make you feel at ease and are they welcoming? Are they stuffy and old fashioned or informal and modern in outlook?Size of Firm. Unless you’re planning to float your business on the NSX, utilising a “big” name in the world of accountancy is unnecessary and expensive. Medium sized firms...

Break-Even Point Analysis

The term “Break-Even Point” refers to the level of sales necessary to cover all expenses i.e. the point of no profit or loss. To calculate this, you need the following: Your expensesYour salesYour gross profit percentage which is your gross profit (sales less your cost of sales) expressed as a percentage of your sales Your break-even point is calculated by dividing your total expenses by your gross profit percentage and then multiplying by 100/1 e.g. if your sales are $180,000 and your gros...

Majority of SMEs unhappy with their accountant

Most of the small businesses who are working with an external accountant or bookkeeper would not recommend their adviser to others and a quarter are looking to switch accountants, according to research by software provider Xero Based on a survey of 1,500 small businesses with an annual turnover of between £20,000 and £20m using various bookkeeping tools, the research shows 80% had an accountant but 70% would not recommend their choice and 27% reported they are likely to switch accountants. A t...

Minimising Tax when Starting In Business

Starting a business can be a stressful and expensive time so it pays to make sure you take advantage of all possible ways to save Income Tax and GST. One common oversight is not to claim for tools, equipment, furniture, computers, vehicles, reference books and any other assets or items owned personally and then transferred into the business upon commencement. For many business owners these add up to many thousands, sometimes tens of thousands where vehicles are involved, so it is certainly worth...

Your Ideal Customer Or Client

Every business owner should be focused on his or her prospective customers. The ability to find a customer, sell your product or service to that customer, and satisfy the customer so that he/she buys from you again should be the central focus of all your business activity. The greater clarity you have with regard to your ideal customer, the more focused and effective your marketing efforts will be. Everyone is in the business of customer satisfaction in some way. Th...

How to Set Your Goals Part 2

Basically, a good goal comes in a format of:What do I want to achieve & by when? And to assist you in setting your goals it’s important that you know the SMART formula which will remind you of the important components of well set goals. S is for specific and your goals should be as clearly defined as possible so that you know exactly what you are aiming to achieve without doubt or ambiguity. M is for measurable because if you can’t measure it you can’t make it. Important in the goal achi...

How to Set Your Goals Part 1

There is a common factor in the success achieved by those who are successful. What is that common factor? It’s that they’ve done the necessary preparation for success. They understand the six P’s - proper preparation prevents pretty poor performance. They know that: Luck is when preparation meets opportunity! And it doesn’t matter what business you are in, what role you have, where you are on the ladder of success or whether it’s your personal or business life there is always opportun...

Selling a Business

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