IRD will again be sending reminder letters or texts to some entities with tax to pay on the 7th April. This means you may receive two payment notifications, one from us and one from IRD for the same payment. Please follow the instructions on the email/letter received from Savage & Savage.
Inland Revenue is improving their GST online services. While the update takes place, all IRD systems will be unavailable from 3pm on Thursday 2 February until 8am on Tuesday the 7 February. You will not be able to access any myIR online services or contact IRD through their call centers. The system update will cause draft returns to be deleted so make sure you complete any draft GST returns before 2 February.
If you are using myIR to file your GST return(s), from the 7th February you will be able to:
If you have provided others with administrator or user access (not your accountant) to your myIR account, you’ll need to review and confirm the level of access you want them to have by 1 February or they will not have access to the improved GST services from 7 February.
The myIR mobile app will no longer be available, you will need to file your GST through your myIR account.
If you have any queries about the changes or how to use the new system, please contact us.
Did you know, that anyone working in return for food and accommodation is likely to be an employee? This means they are entitled to the same minimum employment rights as a paid employee and you need to register as an Employer, file Employer forms with IRD and pay PAYE, check they are allowed to work in New Zealand, keep time and wage records and enroll them in KiwiSaver if they are eligible. You need to make sure they receive minimum entitlement including that the value of what they are getting is not less than minimum wage, and pay sick leave and accrue holiday pay! If you do not deduct PAYE, you still need to calculate the amount of PAYE on the market value of accommodation etc provided and pay it to IRD.
This is not an exhaustive check list, please contact us if you need further information or have any queries.
IRD have recently clarified their position on gifts of food and drink, ie hampers, Christmas ham etc, and these gifts now fall under the Entertainment rule and are only 50% deductible as there is a private benefit. It makes no difference whether the gift is to staff, suppliers or customers. Gifts other than food and drink are still 100% deductible as long as it’s business related, keep in mind FBT for staff. As before, any meals, drinks and entertainment are only 50% deductible, unless it is morning or afternoon tea or meals while travelling, however not if accompanied by a potential or existing business contact in which case it is only 50% deductible.
IRD are continuing to focus on cash jobs among builders and other tradespeople. They are looking into record keeping and tax compliance in these industries with the most recent focus being on Christchurch. It’s never too late to voluntary disclose income that might not have been declared previously in your tax returns. A voluntary disclosure to IRD will generally reduce the amount of short fall penalties applied, especially if this is before IRD notifies you of a pending tax audit.
If you are paying cash for a job, keep in mind that you then have no record of the work being done in the event of something going wrong.
IRD have developed a new website called ‘Changing for You’ which outlines IRD’s ideas on how managing your tax may become simpler for small businesses in the future
Please visit www.changingforyou.ird.govt.nz to have a look as IRD would appreciate your feedback on the site
Tax Refund Services are advertising heavily at the moment. Rest assured, that if you are a client of ours that we prepare tax return(s) for, we will calculate your tax refund/payment due. If you believe you are owed a tax refund for past years, before you became a client but within the last 5 years, we can look this up for you too.
If you are a client, please contact us first if you have any queries as applying online with another company will cause you to be delinked from our tax agent list with IRD and linked to theirs. When it comes time to prepare your accounts and/or tax return, we will need to relink you to our list, causing an unnecessary charge.
The Government has recently announced a proposal to change the way provisional tax is calculated and paid. The new method is called the Accounting Income Method and is based on accounting income per a business’ software and payments would be made more regularly throughout the year. Implementation is not due until 1 April 2018, so we expect some further development and will keep you posted.
The Employment Standards Legislation Bill which came into effect on 1 April 2016 brings some changes to Parental Leave, including:
Some of the above requires certain eligibility criteria be met and some are by mutual agreement with the Employer, so it pays to communicate your plans. To read more about the changes and to find out the details about leave entitlements and criteria visit one of these sites:
The Government announced that the adult minimum wage will go up by 50 cents to $15.25 an hour from 1 April 2016.
The starting-out and training hourly minimum wages rates will also increase from $11.80 to $12.20 per hour from 1 April 2016.