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tax matters

Expected Changes 2011

Trusts - Gift Duty

It has been proposed to remove gift duty from 1 October 2011. This will make make things easier when transferring assets. Note that the existing rules still apply up until October 2011, so if you make a gift this year, be aware of this change.

LAQC's - What now?

Look through company (LTC) structure has been suggested to replace the existing LAQC's. The look through company allows economic losses to be transferred to the individual. This is not the same as previous as there are conditions attached. It is a good time now to review your existing entities. Read more »

GST now 15%

Find GST content: Amount = x$ divide 23 multiply 3

E.G. Amount = ($115/23) * 3 = $15

Find GST exclusive amount:Amount = x$ divide 23 multiply 20

E.G. Amount = ($115/23) * 20 = $100

Tax rates from 1 April 2011

 

  • Individuals tax rates range = 12.5 to 38% (first 6 months)
  • Individuals tax rates range = 10.5 to 33% (from 1 Oct 2010)
  • Company = 28%
  • Trust = 33%

mortgage break fees

Mortgage break fees are most likely to be deductible for the next couple of years. The IRD have issued a public ruling on this Dec09. Check with your Accountant if you can claim.

Property GST claims

Remember this claim for the GST content at the time of purchase must be returned to Inland Revenue at either a change in use event or a future sale. The transactions need to be done at market value. If the property increases in value,  you will pay back more money, however  you have enjoyed the cashflow while you own the property.  Be wise about this - seek professional advice first.

Selling your business

Most likely you will sell assets and goodwill. You may need to pay tax on depreciation recovered on the sold assets. It is in your best interests to obtain good advice before entering any sale negotiations.

Potential tax Deductions

Everyone loves to reduce their tax bill by claiming expenses. However deductions are only allowable in the context that the expense was incurred in the process of deriving assessable income, and there is an intention to make a profit.

consider the following deductions and whether they apply to your business

  • ACC insurance
  • Air Fares and Travel Expenses
  • Bank Fees
  • Cleaning
  • Home Office Expenses
  • Interest on business loans
  • Insurance
  • Rent, Rates Lease Expenses
  • Repairs and Maintenance; Assets costing < $500
  • Records Archiving
  • Rubbish Removal
  • Training
  • Subscriptions
  • Stationery
  • Security
  • Promotions and Marketing
  • Duty
  • Parking
  • Postage
  • Telephones, Fax, Internet
  • Vehicle Expenses
  • Wages

A more complete list of deductions and comments hereRead more »

Contact me if you would like to discuss your particular situation. You never know, I might just be able to help.

 

disclaimer

Ignorance is no excuse when it comes to tax. For your specific situation, you are best to consult your professional advisor. Comments made on this page are of a general nature and are not intended to convey specific advice for your particular situation. I will not accept any liability claim in any shape or form, whatsoever for any misfortune you may encounter from reading this information.