First things first

Talk to your accountant or bookkeeper. They’ll tell you what you need to do before 31 March including what you can claim for and what you can’t. Remember, tax time is busy for them too, so the more prepared you are, the smoother the process, and the better the result.

File your return on time. Don’t waste your hard-earned cash on unnecessary interest and penalties. Get your accounts up to date, tidy up loose ends and file on time.

Your assets and stock

Review your inventory. The value of your stock affects your business’s taxable profit. Do a meticulous stocktake before year-end. Get rid of any out-of-date or damaged items and write them off.

Extra assets on board? Year-end is the time to ditch surplus assets. If you can sell them, great, otherwise write them off.

Your spending

Sooner rather than later. If you’re planning to buy any new equipment or assets, do it on or before 31 March (rather than 1 April) to reduce your taxable income and gain a full month’s depreciation.

Got invoices and receipts for your expenses? It can be tricky to keep track of everything so if you’re not already, go digital. Scanning receipts and saving electronic invoices in the cloud saves time and space.

Your staff

Payroll up to date? Now’s the time to check your payroll system only includes current staff and that all their details are correct. Ensure former staff don’t have access to company systems.

Remember tax on bonuses: Special bonuses this time of year can be a great way to reward and motivate staff, just remember to get the tax right on any lump sums made. Also keep in mind any bonuses for the current year, and holiday pay or long service leave paid out within 63 days after 31 March can be deducted against your current year income.

The Ministry of Business, Innovation & Employment has announced that businesses performing eligible research & development can access faster and more frequent payments of the R&D tax incentive this year.

What is the R&D tax incentive?

The scheme provides a 15% tax credit to businesses conducting ‘eligible’ R&D activities and has supported more than $1 billion in research costs since its inception in 2019. A new feature has been introduced into the scheme whereby rather than receiving the credit after your income tax return has been filed and your application has been finalised by Inland Revenue, regular cash payments can be received starting in the same year as you conduct your R&D.

• Businesses are eligible for the new in-year payments if they have submitted applications and their anticipated tax credit isn’t offset by provisional tax payments.
• Once applications are approved, businesses will receive payments during the tax year in which they made R&D investments.
• In-year payments will be paid as an interest-free loan, repayable when the R&D tax credit is available.
  

2022-23 was the first year in a while without Covid lockdowns or pandemic restrictions, meaning most businesses – especially those in the leisure or tourism sectors – enjoyed a better year.

If you’ve earned significantly more this year than in 2021-2022, congratulations! But you may want to consider an additional voluntary provisional tax payment to Inland Revenue. It could help to balance your tax payments with your growing turnover. It’s better to chat with us about this sooner rather than later.

Review any lending received through the Small Business Cashflow Loan Scheme. The scheme was extended to 31 December 2023, and businesses that have repaid their loans can re-borrow until that date.

Under the scheme, a top-up loan allows businesses that have already accessed lending to draw down an additional $10,000 (or more for businesses that did not initially borrow the full amount available), with a new repayment period of five years (the first two years are interest-free).

Note when your two-year interest-free period expires. Can you afford to repay your loan early to avoid unnecessary interest payments?

The 2021-2022 income year saw new disclosure rules for domestic trusts, requiring trustees to prepare financial statements and provide extra information with their income tax returns.

Trustees need to disclose identification details such as name, date of birth, IRD Number and country of residence of all historical settlors where reasonably available.

Make sure you’re up to speed with the requirements.

Interest deduction on residential rental properties owned before 27 March 2021 are, as you are aware, subject to a reduced claim for interest.

The deduction for interest incurred from 1 April 2022 to 31 March 2023 is 75%.

The Government has increased the minimum wage by $1.50 an hour to $22.70, a 7% increase in line with inflation. The changes come into effect in April.

Xero has announced that from 15 March 2023, the monthly prices of Xero Cashbook and Xero Ledger plans are changing.

• Xero Ledger plan increases by $0.50 to $5.50 + GST
• Non-GST Cashbook plans increase by $1 to $14 + GST
• GST Cashbook plans increase by $2 to $25 + GST

The Starter, Standard, Premium and Ultimate Plans are unchanged.

Johnston Associates Chartered Accountants is a proud sponsor of Moana Pasifika rugby.

As a New Zealand business with a multicultural Team and strong Samoan heritage in our Auckland office and our satellite office in Apia, we choose to actively ‘give back’ by supporting local organisations that provide positive opportunities, and benefit the wider Pacific community.

Coming from a history of rugby, we understand the commitment, mentorship and teamwork the sport brings. Values very much aligned with our own work ethic. We wish the Moana Pasifika Team, and their supporters and families, every success.

View full article here: https://moanapasifika.co.nz/moana-pasifika-partners-with-johnston-associates-chartered-accountants/

Johnston Associates are proud to announce that they are a founding friend sponsor of the inaugural HER Festival.

The idea for the festival was born from the increase in domestic violence over the COVID lockdowns and the inclination to create a forum to share experiences and knowledge and to celebrate all who identify as women.

In the future the intention is to donate profits to Women’s Refuge and other like organisations.

The festival will run from the 13th to the 22nd of April and all events are free.

The program can be found on the festival website https://www.herfestival.co.nz/program

As we continue to introduce our new brand across our business, we will soon be introducing a new look to our Invoices, Credit Notes and Statements.

Along with this change, the email address used to send these documents out will also change from JACAL Debtors / jacaldebtors@jacal.co.nz to Johnston Debtors / johnstondebtors@jacal.co.nz.

So please be aware and if needed update your safe senders lists (or just add as a contact in your email software) so that the emails continue to get through.

We would like to share our news that after many dedicated years in our firm, Chris Sprott and Heather Webster are ready to put away their calculators and are ready to take life at a slower pace, spend more time with family and friends, and in Chris’s case, seek sunshine and adventures abroad. Heather will officially retire at the end of March, with Chris officially retiring at the end of April.

We thank Chris and Heather for their friendly warmth around the office, Team mentorship, and diligence in taking care of their clients so well. Both invaluable colleagues and members of our Team for a long time.

We wish them all the best in their well-deserved retirement and adventures ahead.

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.

So choose your preferred outlet by clicking on one of the buttons below, and don’t forget to follow us!