Get your docs in a row...

We aim to prepare your financial statements and tax returns in good time. To do this we need your completed annual questionnaires with full supporting documentation. Minimise costly delays and keep in mind the likely supporting documents for:

New Bank Loans, balance outstanding at year end, security, interest rate, loan term

Fresh Hire Purchases Items, interest rate, term and repayment plan

Vehicle/Plant & equipment purchases, agreements. Was finance obtained?

Closing Stock and WIP (Work in Progress). Stock on hand at year end? Any un-billed work in progress?

Income, include details of Wage or Employer Subsidies, additional income as defined for Working for Families

Bank Statements. If you use MYOB or a similar system, copies of final bank and credit card statements let us check the reconciled balance

Property/Business Sales/Purchases, agreements and settlement statements

Debtors and Creditors. What is owed by or to your business, including whether amounts are GST inclusive or exclusive?

Donations/school fees? Receipts needed please

Interest, dividends and rebates? Provide details

Tax Pooling

You can easily save more than 25% of IRD’s interest cost on your provisional tax. All with the seal of approval of the IRD.

If you don’t pay the correct amount of tax on time the IRD charge you interest. The current rate is 8.89%.

Tax pooling is a service introduced by Inland Revenue in 2003 that allows provisional taxpayers to reduce their exposure to IRD interest costs.

How it works: When we have finished your income tax return, we will inform you whether you owe any further tax to IRD. In many cases, you will also owe IRD interest.

Tax pooling allows you to buy tax credits that other taxpayers do not need. These tax credits have already been paid to IRD, but through the tax pool can be transferred from the seller to you. The cost of buying those credits is substantially less than paying IRD interest.

The table below shows the savings you can make on 2011 underpaid provisional tax if purchased in March 2012.

Underpaid Provisional Tax	Estimated Savings
$10,000	$268
$20,000	$536
$30,000	$803
$50,000	$1,338
$100,000	$2,675

We can quickly arrange a tax purchase on your behalf as we work closely with NZ’s leading tax pooling company, Tax Management NZ. They’ve assisted thousands of NZ companies and individual provisional taxpayers in saving money.

Quake Hero Dog to be Honoured with Award

It will be a big day for a big dog.

An 80 kilogram irish wolfhound will be the first animal to be presented with a Local Hero Medal, as part of the 2012 Kiwibank New Zealander of the Year Awards.

Guinness, known as earthquake dog, will stand alongside Mayor Bob Parker, Student Volunteer Army founder Sam Johnson and other unsung Christchurch heroes to have an engraved bronze cast medal placed over his hairy head at The George Hotel on Thursday night.

Owner Sean Scully, 37, who is also a medallist, said Guinness was very proud of himself and hoped the award would "increase his luck with the bitches at the dog park".

"It's going to be a big night for both of us bachelors, but the biggest issue will be getting us both presentable."

Six-year-old Guinness will be groomed for the first time before the ceremony and Scully had planned to buy a dog brush this week.

He had also contemplated a canine bow tie, but didn't think it was Guinness' style.

Yesterday Scully, who is a law student at Canterbury University, rang The George Hotel to warn them "one of Thursday's attendees will be a giant dog".

He promised Guinness would be on his "best behaviour - seen but not heard" during the night.

Scully and Guinness are being recognised for their work in Christchurch's shattered eastern suburbs after the February earthquake.

They worked 12-hour days for three weeks, led a Bobcat fleet and gave out hundreds of donated shovels, wheelbarrows and water bottles.

The giant dog's presence brought smiles to the faces of quake-hit residents. He even gave children rides on his back around silt-laden streets.

Guinness still "goes everywhere" with Scully.

He is often spotted padding around the university and is a well-known patron at the Carlton Country Club in Merivale.

The gentle giant's latest "party trick" is standing at the bar drinking a pint of Speight's with Scully.

Emma Mcdonald, spokeswoman for New Zealander of the Year Awards, said Guinness was the first animal to receive a Local Hero Award.

He would most likely also be the last, she added.

Published: 7:24AM Tuesday March 27, 2012 Source: Fairfax

Some Tax Stuff!!!

Working For Families: From April 1 2012 many of the small changes to Working For Families signalled last year come into effect:

§ The family tax credit amount for children under 16 will rise for inflation:

Qualifying Child	Current amount	New amount
First child if under 16	$4,578	$4,822
Second child if under 13	$3,182	$3,351
Second child if 13 - 15	$3,629	$3,822

§ The net income level guaranteed by the minimum family tax credit will rise from $22,204 to $22,568

§ The abatement rate will increase from 20 cents to 21.25 cents in the dollar

§ The abatement threshold will decrease from $36,827 to $36,350

KiwiSaver: As of 1 April 2012 employer contributions will no longer be tax free. Employer Superannuation Contribution Tax will apply at the employee’s marginal tax rate.

Minimum wage: As of 1 April 2012 the minimum wage will increase from $13.00 per hour to $13.50 per hour.

Training and new entrants’ minimum wages will increase from $10.40 to $10.80 - 80% of the adult minimum wage.

Remuneration of shareholder employees

The Penny and Hooper decision is a landmark tax avoidance case that has implications for small businesses operating through a company or trust. Essentially, the Supreme Court decided in favour of Inland Revenue, concluding that setting artificially low salaries amounted to tax avoidance.

Penny and Hooper were two orthopaedic surgeons, each earning taxable income of between $600k and $850k a year. They restructured their businesses into companies with a family trust owning most of the shares. They provided their services to the companies in return for salaries of $100k - $120k each year. The balance of the company’s income was declared as dividends to the family trust which the surgeons drew from regularly.

Each year tax of between $20k and $30k was saved by having the profits after salaries taxed at the trustee rate rather than at the surgeons’ individual top personal tax rates. The court found these savings a ‘more than merely incidental’ reason for their low salaries.

The IRD has put businesses on alert and is actively reviewing those operating through a company or trust where the income is generated from services provided by an individual, and the individual’s salary is unreasonably low. Although there may be good reasons for setting the salary low in a particular year, e.g. adverse business conditions, or a planned expansion of the business, in some cases the sole reason for the salary level is to take advantage of the lower tax rate that applies to companies.

The IRD is entitled to go back four years into a business’ records, but have publicly confirmed that where a ‘voluntary disclosure’ is made, only the last two income tax returns will be reassessed. A voluntary disclosure might significantly reduce IRD penalties or avoid them entirely.

Whenever we’re discussing your business we’ll look at this for you. In the meantime, if you are concerned and would like to discuss this with us, please do contact us.

Xero has new HQ - it's cool!

Check this out, Xero has a new home and a great story to go along with it. Read more about their one year adventure here.

What on Earth?

A member of the Findco family was lucky enough to get to see Miss Taylor Swift in concert this weekend....not Scott or Wayne! Here is Taylor rocking an All Black jersey during her encore. Lots of little girls screaming!

NZ Government, like no other!

Sometimes when we might get a little embarrassed with our government and our politicians for whoopsies like the silly tea party tapes, or Prime Minister John Key calling Hilary Clinton President Clinton, or Winston Peters being thrown out for calling Brownlee an ‘illiterate wood work teacher’ and David Benson-Hope falling asleep in the chamber (amongst other things) we can remember how truly unique our government is, and has been in the past.

In 1983 we were the first self-governing nation in the world to grant women the vote. With Kate Sheppard leading the charge, “women's suffrage quickly became a central element in New Zealand's image as a trail-blazing, progressive 'social laboratory' of the South Pacific.”

Some of our more colourful characters continued this trail blazing trend like the Labour Party’s Georgina Beyers, who was the worlds first openly transsexual Member of Parliament and Nandor Tanczos representing the Green party sporting an almighty head full of mid-back length dreadlocks.

Our politicians are diverse, interesting and from varied backgrounds. Some are lunatics, some are intelligent, some are a bit wild, however, as we address the MMP debate and think about how and who our government should be made up of, we can be relieved to know across the board, we are unique, innovative thinkers and characters.

At the core we hope their intentions are for the good of NZ. When Helen Clarke became Prime Minister her Dad was quoted to have said “ the country is in good hands” and I guess that is all we really want!

ACC Changes Self Employed Invoicing

ACC has recently changed the way it invoices self-employed clients with regard to their full or part-time status, dependent on whether you work 30 hours or more a week.

Information on your full or part-time status no longer flows through to ACC’s database on the IRD IR3 form. If you held part-time status last year and this year your earnings crossed the threshold you will receive a letter from ACC automatically confirming your change to full-time status. In all other scenarios it is up to you to formally confirm a change of status with ACC.

It would pay to check your invoice this year and call us if there’s any confusion. Clients could get stung, for instance, if they have been paying levies on the basis of part-time status, have an accident, and then declare full-time status. In such a case ACC may query it and can backdate levies up to four years.

We provide an ongoing ACC administration and advisory service to our clients on an agreed annual fee basis. Being recognised by ACC as your online agent gives us secure online access to your levy information, your cover status and invoices, allowing us to work directly with ACC. A simple signed authority from you and we’d be happy to review your cover structure and premiums, to ensure your cover is appropriate and levies are minimised.

Dog Cam Wanaka Show

The Wanaka Show was another huge success this year with over 18,000 people attending. A highlight as usual was the Jack Russell race. Check out the dogs eye view above!

Easter Weekend in Wanaka, mega fun!

More than just accounting goes on in Wanaka!!! This Easter we are host to the Wanaka Warbirds again. We have been lucky enough to spy a little practice action over Wanaka town lately. Get your tickets online at www.warbirdsoverwanaka.com

KiwiSaver in a nutshell

KiwiSaver is a voluntary, work-based savings initiative to help you with your long-term saving for retirement. It's designed to be hassle-free so it's easy to maintain a regular savings pattern.

There are a range of membership benefits to encourage you to get saving. They include a $1,000 kick-start, regular contributions from your employer and an annual member tax credit paid by the Government. Some people may also be eligible for help with the deposit on their first home.

KiwiSaver schemes are managed by private sector companies called KiwiSaver providers. You can choose which KiwiSaver provider to invest your money with.

KiwiSaver is not guaranteed by the Government. This means you make your investment choices in a KiwiSaver scheme at your own risk.

How you make contributions

For many people, KiwiSaver will be work-based. This means you'll receive information about KiwiSaver from your employer, and your KiwiSaver contributions will come straight out of your pay.

If you choose to join, contributions are deducted from your pay at the rate of either 2%, 4% or 8% (you choose the rate) and invested for you in a KiwiSaver scheme.

If you're self-employed or not working, you agree with your KiwiSaver provider how much you want to contribute, and make payments directly to them.

When you can get your money

Your KiwiSaver savings will generally by locked in until:

• you're eligible for NZ Super (currently 65), or
• you've been a member for at least 5 years (if you joined over the age of 60).

You may be able to make an early withdrawal of part (or all) of your savings if you're:

• buying your first home
• moving overseas permanently
• suffering significant financial hardship
• seriously ill.

What you will get when you retire

NZ Super provides for a basic standard of living in retirement, but it may not be enough for the kind of retirement you want. Having a KiwiSaver account doesn't affect your eligibility for NZ Super or reduce the amount of NZ Super you would be eligible for.

KiwiSaver savings will complement NZ Super to provide you with a better standard of living for your retirement.

To find out how much you're likely to need in retirement, visit the Sorted website or seek advice from a financial advisor.

The Xero Story

A fantastic Kiwi tale. Take a look at the behind-the-scenes video and listen to the full story now in the iTunes store for free.

End of year checklist!

1. Consider pre-paying certain expenses

Some expenses can be prepaid in March and claimed as a tax deduction in the year to 31 March 2012, regardless of their amount. These include stationery, postage and courier charges, vehicle registration and road user charges, rates, subscriptions for papers or journals, and even audit and accounting fees!
Other expenses have limits on the extent to which they can be claimed if prepaid. These include rent, consumables, insurance premiums, professional or trade subscriptions, travel and accommodation, advertising, periodic charges and other services. The rules surrounding prepayments are quite complex, so if you’re planning this type of expenditure, please contact us.

2. Trading stock

Trading stock (excluding livestock) must be valued at the lower of cost or realisable value. General adjustments for obsolete stock are not acceptable to Inland Revenue. It’s important therefore to perform a physical stock take at year end and actually dispose of any obsolete lines or alternatively write that stock down to its net realisable value.
Clients with an annual turnover of less than $1.3m can value their closing stock at the opening stock value, but only where closing stock can be reliably estimated to be less than $10,000.

3. Loss offsets and subvention payments

2011 loss offset or subvention elections must be filed with IRD on or before 31 March 2012. Subvention payments relating to the 2011 income year must be paid by 31 March this year. The IRD recently changed its practice of requiring an actual physical payment, and now accepts that a subvention payment can also be made by book entries so long as the payment obligation is discharged.

4. Write off any bad debts

To claim a deduction for a bad debt you need to physically write the debt off in your debtors’ ledger prior to the end of your financial year. For most clients that’s 31 March 2012. There should also be evidence that you have taken reasonable steps to recover the debt prior to writing it off.

5. Employee expenses

Any amounts owing to employees at year end (such as holiday pay, bonuses, long service leave, redundancy payments) can be claimed for tax purposes in the current year as long as they are paid within 63 days of balance date.

6. Review last year’s fixed asset register

The book value of assets can be written off for tax purposes if the asset is no longer in use by the business, the business has no intention of using that asset in the future and the cost of disposing that asset is expected to be greater than the proceeds from its sale. Actually, it’s simpler than that. Scan your asset schedule from last year’s accounts and you’ll probably notice assets that no longer exist (the mobile phone that you dropped in the tide at Christmas time), or simply don’t work.

7. Retentions

Retention on building contracts are generally taxable in the year the contractor becomes legally entitled to receive them. This can result in significant deferral of income.
8. Discount reserves

A deduction for a discount reserve, to cover for example prompt payment discounts, is allowable where debtors are entitled to such a discount. In the first year a deduction of the actual discount percentage is allowed and in subsequent years a calculation is made to maintain the discount reserve at that percentage level. If the credit period offered to customers exceeds 93 days, different rules apply.

9. Repairs and maintenance

General adjustments for repairs and maintenance reserves are not allowed as a tax deduction. Instead it may be worthwhile to undertake any necessary repairs and maintenance on key assets prior to the end of the financial year to ensure a full deduction. Deciding whether expenditure on an asset is deductible as repairs or maintenance or should be capitalised is not always cut and dried, so please contact us if you aren’t sure.

10. Imputation credits and dividends

Companies have until 31 March 2012 to distribute imputation dividends that arose based on the old company tax rate of 30%. From 1 April 2012, imputation credits to be distributed are limited to the equivalent of 28%, in line with the new company tax rate effective from that date.
In addition, imputation credit account balances must not be overdrawn as at 31 March each year. If so, they attract penalties.
We realise the subject for imputation credits is complex for many of our clients. Rest assured we will contact you regarding any necessary dividend and taxation planning before 31 March.

11. Income

Be sure to review any credit notes issued to customers following balance date that can be applied to the previous year, i.e. 31 March 2012. In doing so, you will be entitled to effectively reduce your current year’s taxable income.