New trust tax rate: mitigating over-taxation

As part of the Taxation (Annual Rates for 2023 – 24 Multinational Tax and Remedial Matters) Bill, the trust tax rate will increase from 33% to 39% from 1 April 2024.   The new tax rate may be cause for concern for individuals with assets held through trusts, as even those not considered high-income earners may end up with their trust paying tax at a high rate of 39%. Inland Revenue…  Read more

Improving landscape for residential property investors: interest deductibility & bright-line rule changes

In recent times residential property investors have felt the weight of evolving tax policies and higher interest rates. However, with changes to interest deductibility and the bright-line rules in the coming financial year, there is appears to be a more favourable investment landscape ahead.   Interest deductibility A concern for residential property investors has been the limitations on interest deductibility. Under the previous Labour government, the ability to offset mortgage…  Read more

“App tax” coming 1 April 2024: GST on all Airbnb and digital platform services 

The new National coalition government has decided to keep the “app tax” initiated by the previous Labour government in 2023. During election campaigning National had promised to reverse the change that would have seen GST imposed on accommodation and transportation providers on platforms like Uber and Airbnb. However, now as they seek means to fund their coalition policy initiatives, they’re sticking with Labour’s plan, and the change will happen next…  Read more

Cross-border and remote workers tax changes

The way people work has transformed due to the Covid-19 pandemic, leading to an increase in remote work, including cross-border arrangements. This shift benefits employers by expanding the talent pool and employees by offering a better work-life balance, eliminating long commutes, and providing more flexibility. However, it’s crucial to be aware that working across borders can result in tax responsibilities for both employers and employees. These obligations may be unclear…  Read more

Tax considerations for short-term vs long-term residential rental income

Owning a residential rental property can be a lucrative investment, providing a steady stream of income for property owners as well as long term capital growth. However, when it comes to tax considerations, the type of rental income—short-term or long-term—can significantly impact your financial obligations. Whether you are a short or long-term rental property owner in New Zealand, you must report your earnings on your annual income tax return. It’s…  Read more

GST & Unit Title Bodies Corporate (UTBC)

The IRD has recently published an interpretation statement (IS 23/08) to provide guidance on how GST applies to different transactions between a unit title body corporate, its members, and third-party suppliers. A UTBC is a separate legal entity to its members.  It can decide whether to register for GST.  UTBCs are generally considered only making taxable supplies to their members in the form of members’ levies.  The value of supplies…  Read more

‘No GST’ vs ‘zero-rated GST’ transactions

If you’re a business owner or taxpayer in New Zealand, you’ve likely encountered terms like ‘no GST’ and ‘zero-rated GST’ transactions. These terms refer to specific tax treatments under the Goods and Services Tax (GST) system in New Zealand. In this blog post, we’ll break down these concepts in simple terms to help you understand the difference. No GST transactions No GST transactions are those where the goods or services…  Read more

Tier 3 not-for-profit financial statements: a beginner’s guide

Many not-for-profit organisations fall under the Tier 3 standard which is a specific set of accounting standards designed for smaller entities, usually organisations with relatively simple financial structures and limited resources.  These standards are issued by the External Reporting Board (XRB) which is a Government Agency. The Tier-3 standard applies to Public Benefit Entities (PBEs) that do not have public accountability and have expenses less than or equal to $2…  Read more

Small business guide to depreciation

Depreciation is basically a reduction in the value of an asset over time. What this means for your business is that if you buy a substantial asset like a computer or a car, you can claim a certain amount of the loss of value over time as a business expense. It’s also a method of spreading the costs of large assets over time. It’s important that your business claims the…  Read more

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