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Pay Less Tax - Part 2

As accountants, one of our roles is to create tax efficiency for business owners. We do this, by ensuring a business claims all entitled expenses to reduce profit and therefore pays less tax. One expense that may reduce taxable profit is a home office expense claim. Home office expenses are claimable when a business owner uses part of their home for their business. This could be as an office (either an actual office, or a spare bedroom used as an office), or if the actual business is ran from ho...

Pay Less Tax - Part 1

Table 0.1 – How AgBiz Accountants could save you more than $12k in tax (an extra 10%) EntityProfitTaxTax Savings Individual$120,000$30,520$9,080 Company$120,000$33,600$6,000 Trust$120,000$39,600$- Evans Doyle Way$120,000$27,580$12,050 Everyone pays tax on their income. The rate of tax you pay depends on how much income you earn (for an individual), or what type of business structure you operate (for businesses). This will help you understand how the different rates of tax are ca...

The MYTH Of Tax Deductions

Did you know that a $70 lunch may only give a tax deduction of $6.13? How often have you heard a business owner say "It's ok, it's a business expense and I can claim it for tax"? Do they really understand that a $70 lunch or dinner may only provide a tax deduction of $6.13? Would you spend $70 to only get $6.13 back? Our take home messages are as follows: The tax deduction on any business expenditure is only a percentage of that expenditure, not the full amount of the expenditure.Don't allow 'ta...

Tax Tips - GST Insights. Part Two

So what are the different methods for doing my GST? Following on our GST theme, this blog will explain the difference between 'GST basis' and outline the advantages and disadvantages of each. In a nutshell, you can pay GST when you receive the cash from your customer, or when you issue an invoice to your customer. Either option can be beneficial to your business. You have three options if your turnover is under $2 million: payments basisinvoice basishybrid basis Or two options if your turnover i...

Tax Tips - GST Insights. Part One

Do I need to register for GST? One of the most popular questions often asked from people starting a business is, 'do I need to register for GST?' This article will answer that question. GST is a tax on consumption, on goods and services supplied in New Zealand. This is different from income tax which is a tax on profit. Who must register for GST? You must register for GST if you carry out a taxable activity and: your turnover was $60,000 or more in the last 12 months or will be $60,000 or m...

The Difference Between Income Tax and GST

What is the difference between GST and Income Tax? Income tax is a tax on profit while GST is a tax on consumption. This article will explain the differences and basic compliance requirements of each. 1. Income Tax Everyone who earns taxable income in New Zealand pays income tax. For employees, the employer deducts PAYE and pays the income tax to the IRD on the employee's behalf, while the employee receives a net wage or salary. Business owners must file a tax return each year to the IRD declari...

5 key characteristics which define the entrepreneurial spirit of successful small businesses!

According to a recent survey of 2000 businesses in the US and UK by Xero, here are the 5 key characteristics which define the entrepreneurial spirit of successful small businesses… 1) It's not all work work work! They don't work around the clock. They make time to spend with those important to them and to enjoy hobbies. 2) They don't pretend they have all the answers!Always be learning and if you don't have the answers, it's ok to ask questions. Most even had a mentor who they s...