Paying your taxes on time is an important part of being a responsible business owner, but understanding New Zealand’s tax system and tax returns can be a challenge. Thoroughly understanding the process and utilising tax strategies can help business people maintain a healthy financial status while saving money and ensuring proper legal compliance.
Understanding New Zealand Taxes
New Zealand’s tax system requires business owners to file annual tax returns, including income tax on business income, GST (Goods and Services Tax) and PAYE (Pay As You Earn) for employees. This process involves calculating taxable income, claiming applicable deductions and ensuring accurate documentation of all financial transactions.
Income Tax. This is the tax on the net profit of your business. It requires careful documentation of all income sources and allowable expenses. Companies must report their total income and deduct allowable expenses to determine the net taxable income. Keeping thorough records throughout the year is essential for accuracy.
Goods And Services Tax. This is a tax on goods and services that are sold in New Zealand, although there are a few exceptions where you do not need to pay GST. GST returns require businesses to report the GST collected on sales and the GST paid on purchases.
Pay As You Earn. For businesses with employees, PAYE needs to be deducted from your employees’ wages and paid along with employer contributions. This system is set in place so that your employees’ income tax and other deductions are paid directly from their wages.
Professional Advice And Strategies For Maximising Tax Returns
While it is important for business owners to understand their tax obligations, there is help available to enhance your tax plan and save money while staying compliant with New Zealand’s laws. Chartered accountants, such as those on our team at Allan Chartered Accounting, can provide you with the professional advice and support you need.
We focus on personalised services, meaning we won’t offer you generic advice – we’ll provide you with support and customised assistance specifically meant for your NZ business. We can explore different tax strategies to discover the best ways you can maximise your tax returns:
Accurate Record-Keeping. With our assistance, you can maintain detailed records of all income and expenses. This includes receipts, invoices, bank statements and other applicable financial documents. Accurate records ensure that you claim all allowable deductions and reduce the risk of errors in your tax return. Staying organised can save you plenty of time and stress during tax season.
Claim All Deductions. We will discover the deductions available to your business so that you can lower your taxable income and increase your tax savings. We look at deductions such as office expenses, travel costs, depreciation of assets and more.
Professional Tax Planning. Proactive tax planning throughout the year is a must, and we’ll stay on top of everything so you can focus on other important parts of your NZ business. Tax planning can include forecasting your tax obligations, managing cash flow effectively and making strategic financial decisions to minimise tax liability. We can regularly review your financial statements and plan for upcoming tax payments to ensure that you have sufficient funds available when needed.
Staying organised and planning things out can make your taxes predictable, helping you avoid unpleasant and potentially expensive tax surprises.
Annual Tax Reviews. We can conduct a yearly review of your taxes to identify opportunities for tax savings, ensure your tax structure is optimised and help you avoid unexpected tax expenses. An annual review lets us make adjustments and have an overall view of your tax situation. Using this information, we can plan for the year and discover new ways to improve.
Stay Informed. Our team always stays up to date with changes in NZ tax laws and regulations, and we’ll keep you informed if any changes will affect you. Understanding changes can also help us identify new ways to take advantage of opportunities so we can adjust our strategies for the future.
Enhance Business Structure. Together, we can review your business structure to see what you’re handling well and where you could improve regarding tax efficiency. Routinely reviewing your business lets us look at your company as a whole so that we can continuously make changes for the better and help you reach your overarching business goals.
Separate Personal And Business Finances. We can take steps to help you keep personal and business finances separate to proactively avoid confusion and ensure accurate record-keeping.
Simplifying Your Tax Returns And Maximising Your Potential In Auckland
At Allan Chartered Accounting, we’re committed to providing our clients with the efficient, personalised and effective services they deserve. Every business is unique, which is why we take time to thoroughly understand your particular goals and circumstances when we offer you our services.
Are you interested in our help? If you’d like to discuss your business with us or if you have any questions, please call us on +64 9 418-2537 or use our contact page.
Allan Chartered Accounting: Discover the accounting services you need to succeed.