New Zealand’s Goods and Services Tax (GST) system is often praised for being a simple broad-based tax. But this doesn’t mean mistakes don’t happen. Going back to basics, if you carry out a taxable activity in New Zealand and your turnover is more than $60,000 in a 12-month period, you are required to register [...]
A company is sometimes referred to as an interim taxing vehicle because the income of a company is first taxed when derived but then taxed again when distributed to its shareholders. The benefit of the tax paid by a company is captured as imputation credits and able to be attached to dividends. Ensuring that [...]
Whether it’s a cold, flu, a tummy bug from day-care or the notorious C-word, we’re only partway through winter and already the amount of sick leave being taken seems higher than normal. In New Zealand, most employees are entitled to 10 days of paid sick leave per year – this was only increased recently [...]
On 20th July 2022 Inland Revenue released a 51-page interpretation statement 22/04 – Claiming depreciation on buildings. In light of the re-introduction of depreciation on non-residential buildings from the 2021 income year, the interpretation statement is intended to give guidance to building owners on when they can claim depreciation on buildings. Specifically, the statement emphasises the [...]
There are common misconceptions in relation to how portfolio shareholdings in foreign companies are treated for tax purposes. One misconception is that if either the profits of the foreign company or the dividends it pays have been subject to tax overseas then New Zealand (NZ) tax does not apply. Another is that if the [...]
Inland Revenue has started publishing Technical Decision Summaries (TDS’) from mid-2021. A TDS is an abridgment of either an adjudication or private ruling decision made by Inland Revenue’s Tax Counsel Office (TCO). TDS’ will be published within three months of a technical decision being finalised. They are not binding and are for information use [...]
Residential property acquired after 27 March 2021 is subject to a 10-year bright-line period, or 5 years if the property qualifies as a ‘new build’. The extension to 10 years has increased the likelihood that a property transfer will be caught. In an attempt to alleviate the risk that related party transfers would be [...]
The introduction of the 39% tax rate for individuals who earn over $180,000 from 1 April 2021 has reignited Inland Revenue’s interest in the income attribution and market salary regimes. These rules currently prevent a person from having income earnt from individual efforts or “personal services” taxed through an associated entity at a lower [...]
An introduction to the metaverse No physical interaction, no leaving your home, talking to people over the internet - a COVID nightmare, or the future of our society? The metaverse is a topic that has gained a lot of traction recently, particularly with Facebook’s rebranding to ‘Meta’ and its announcement that it will now [...]
Advice and Tax Updates A quick reminder to check your entitlements for Covid -19 (Covid) Resurgence Support Payments: The Leave Support Scheme helps businesses to help pay workers (including self-employed) who are instructed to self-isolate because of Covid-19. The Short-Term Absence Payment provides support to pay eligible workers needing to stay at home while awaiting a Covid [...]
