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GST Tips

Posted on 23 June, 2019 at 0:40 Comments comments (0)

Dellow - GST Tips


Tax minimisation is extremely important to us.

Please review our GST tips and take a minute to consider if you would like a GST review. 



1. Registering for GST too early or too late


For a new or small and growing business, deciding when and whether to register for GST can be tricky.


If your customers are private individuals and you register too early, you might be voluntarily giving up thousands of dollars.


If, on the other hand, your customers are GST registered, you could register to get the GST back on your outgoings.


Register too late, and surprise surprise, the Inland Revenue may impose penalties and interest.


2. Claiming GST on overseas transactions and unregistered suppliers


GST can’t be claimed on services and products sourced from overseas suppliers.


Often, these types of errors are unintentional and simply overlooked.


For instance, goods or services purchased through online companies such as MailChimp, iTunes, Facebook, or Google Apps are from overseas suppliers and cannot be claimed.


To be safe, check your invoices and receipts to see if NZ GST has been charged.


Keep in mind as well that many smaller businesses and subcontractors are not registered for GST, which means it cannot be claimed.


3. Buying assets or equipment that may be used for personal purposes

When you’re purchasing assets or equipment for business use, you may claim a GST deduction, but the amount you can claim may vary depending on whether you are a company, sole trader or partnership.


Where the asset is to be used 100 percent for business purposes, it is normally fully deductible regardless of your trading structure.

However, where there is private use, such as with motor vehicles, sole traders and partnerships must make an adjustment to the GST claimed for the expected private use component.


When a company is involved, you can normally claim all the GST, but you will need to pay some GST on every future GST return to compensate the Inland Revenue for that private use.


4. Leasing and hire purchase


If you’re buying assets or equipment using asset finance, getting the GST correct often causes problems.


If you’re taking ownership of the assets or equipment (or if there’s an option to take ownership), you can claim all the GST up front (subject to any private use above).


But if you just have the right to use the assets or equipment for a limited period, the GST is claimable on each payment.


There are all sorts of leasing deals out there, so watch out because when it says it’s a lease, it may not be. Also be aware because sometimes GST only applies to part of the regular payment.


5. Introducing "second-hand/private goods" to your business

When you buy a second-hand item for business, you can generally claim the GST even if the vendor isn’t GST registered.


If you’re the vendor (for instance, if you are selling something to your company or you’re buying from a related party), there are complex rules to prevent you from gaining what Inland Revenue would consider to be an unfair advantage. Deductions are available for these good being introduced to the GST "pool" and should be pursued.


If you prepare your own GST Returns there may be some value in ensuring everything you are entitled to are being claimed.


Recently we have noted several builders, plumbers, and mechanics that appear to have very few tools on their fixed asset schedules.


Often an adjustment is required for existing assets introduced to the business on start up. This can be significant - more here


6. Home Office Expenses


To calculate your GST adjustment you need to work out the percentage of the area that is used for work against the total area of your home.


The table below explains how to calculate an adjustment for home office expenses and provides an example.


Scenario: Erana has an office set aside in her private home. The office is 10 square metres of a 100 square metre house. Therefore, the business percentage is 10%.


The total house expenses including GST for the taxable period were $1,000, including:

rates $500

insurance (house) $200

electricity $300


Step 1 Work out the value of the business (taxable) use.

$1,000 x 10% = $100


Step 2 Multiply the amount from Step 1 by 3 then divide by 23. This is your GST adjustment. Transfer the totals to Box 13 on your GST return. 100 x 3 divided by 23 = $13.04

Payroll

Posted on 23 June, 2019 at 0:35 Comments comments (0)

Weekly IRD Filing for Employers

Businesses can choose to report payroll information every payday instead of monthly.

 

Payday filing is compulsory from 1 April 2019.

Dellows has a number of payroll solutions. Our preferred third party provider is https://thankyoupayroll.co.nz/" target="_blank">Thankyou Payroll. 

Thankyou payroll is free for businesses with under 3 staff, and $19pm for business with 4 - 10 employees. Thankyou payroll direct debit from your business account, then pay all staff, send payslips, and file and pay the IRD meeting all tax compliance requirements.

Thankyou payroll links to Xero and overall saves a lot of time and is a very well priced solution.

 


Business Planning

Posted on 23 June, 2019 at 0:30 Comments comments (0)

Business Planning

Lets plan in 2019, to realise your financial and business goals, a good place to start is a clear plan. "Now" "Where" and "How" (where are you now.., where to you want to be.., and how are you going to get there..). Assign responsibility "who" will do these things and set a date "when" will they be done.

Dellows has specialised planning software MYOB Profit Optimiser. We can analyse your business, and explore strategies, make forecasts, and set goals, all at the touch of a button. Financial Diagnostics, health checks, and various other add-ons are available to Dellow clients. 


 

https://www.business.govt.nz/search?Search=business+plan&searchlocale=en_NZ&form_source=head&action_results=Go" target="_blank">Link to Additional Resources

 

 

Great Deal on Life & Income Protection Insurance

Posted on 30 March, 2019 at 14:35 Comments comments (0)



We have a great offer available for Sovereign Life Insurance.

 

Get 10% off the life of your policy with Sovereign Life + one offer.

You can now get 10% off your new Sovereign policy when you take out Sovereign Life Cover with one other new Sovereign TotalCareMax risk-benefit. And this discount will apply for the life of your new policy.

 

Take advantage of this Sovereign ‘Life + one’ offer today and make sure you have the cover you need for the peace of mind you want — and with the money you save, invest it elsewhere or enjoy spending on life and leisure, family and friends!

This offer will be available until 31 May 2019.

 

Simply reply to this email and I’ll contact you with an email fact finder, followed by a no obligation quote, so we can discuss the best options for you.

 

We may be able to reduce ACC Cover via CPX to allowing for contributions to income protection, significant savings, and additional benefits. Airpoints are available @ AP$1 for every $100 spent on premiums.

 

Kind Regards, James Dellow


 


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