One of the biggest issues facing all business owners today is cash flow; that is, getting paid by your customers and being able to pay creditors. If you can collect all of your debts you are in a better position to pay your own debts.

If you have supplied goods or services to your customers it is a reasonable expectation to be paid in a prompt manner. Here are some tips to help you collect your payments due in a timely manner,

Inland Revenue continues to focus on taxation of land activities.

Earlier this year, ring fencing of losses from residential investment properties was introduced. Inland Revenue have now turned their attention to the exclusion from tax for people who use land as their main home, residence or business premises. These exclusions do not apply where there has been a regular pattern of buying and selling property used for such purposes.

Taxpayers often find it achievable to work around these exclusions. They can do so by avoiding a “pattern” of land sales. There is no pattern where the land activities are in the names of different, but associated, persons each time. Similarly, there is no pattern where no similarity or likeness between the land transactions exists. There is no similarity or likeness, for example, where one person bought bare land then built a home on it, and in the case of another property, that person simply lived in a pre-existing home until the time of sale.

These rules are likely to change. A Bill is forecast for early next year that will amend the applicable provisions here. The Bill will extend a pattern to persons, or groups of persons, or entities to land that has been occupied by the person or group as their main home, residence or business premises or occupied as a main home, residence or business premises by the person or group of people that control the entity or entities that own the land.

The Bill will also remove the regular pattern restrictions where a person has a pattern of buying and selling land that they occupy as a residence or business premises, where they carry out different activities on the land while they hold it. Expect these law changes to come into force from 1 April 2020, though there is some prospect of them applying retrospectively.

IRD ramping up its investigation activity by targeting businesses under-reporting cash sales or paying staff under the table is an opportune time to remind taxpayers that tax pooling can assist with audits or voluntary disclosures. The hidden economy is estimated to be worth close to $1 billion. That’s why IRD is cracking down on cash payments and gearing up for a string of surprise visits to ‘high risk’ businesses.

Many will have read the story about the department’s investigation staff conducting searches and unannounced visits to cafes, restaurants, bars and takeaway operators in Queenstown and Central Otago recently. Bakeries and liquor outlets are also on their radar. It follows the successful prosecution in the Thai House case.

The hospitality sector has a high risk of businesses not declaring income and/or paying staff under the table because of the high number of cash transactions and the more short-term nature of employees.
During the Queenstown and Central Otago campaign, IRD says it seized wage records, computers and other business records using court-issued search warrants. Staff also seized information on employer-provided accommodation, rental properties, Working for Families tax credits and payroll matter, as well as till records and lists of staff names and work rosters to check against employee details it holds. Similar investigation activity is being done in the trades and construction sector because cash-in-hand jobs are more common.

We are emailing out reminders for tax payments – as these are due 15th January 2020 we would recommend that you set these payments up now for payment by due date.

We are incredibly honored to receive this recognition from CA ANZ and to be acknowledged as one of the Top 30 Accounting Firms in New Zealand.

Giving thanks to the team here at Johnston Associates for all their continued hard work & dedication.

Our team would also like to thank each and every one of our fantastic clients for their continued support throughout the year.

17 Years of service dedicated to St Johns from one of our awesome Senior Accountants of JACAL. A round of applause to our very own Vijay Kumar, Vijay has proudly been a caring caller for over 17 years and enjoys this thoroughly.

“A very rewarding experience when we share our time for the sake of our community. A truly JACAL attitude expressed loud and clear!” Says Vijay.

Caring Caller is a service that St John provides for people who live alone or feel a bit lonely. Volunteers phone clients regularly to check that everything is ok. This free service is fully funded by donations. If you would like to volunteer your time and become a caring caller please visit St Johns website or contact St Johns Directly.
https://www.stjohn.org.nz/What-we-do/Community-programmes/Caring-Caller/

Congratulations to the Tasman Makos Rugby Union team, sponsored by Johnston Associates South, for their victorious win against Auckland on 19th October 2019. The semi-finals took place at Lansdowne Park in Blenheim where the Tasman Mako’s put on an outstanding performance with a rewarding result of now being the 2019 Mitre 10 Premier Champions!

Johnston Associates has decided to provide more regular information via social media channels – namely Facebook and LinkedIn. We will continue to publish our quarterly newsletter, but you will find more regular and timely information through these channels.

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