FAQ
ACC Premiums
The Accident Compensation Corporation (ACC) has responsibility for insuring and collecting ACC premiums for employers, the self-employed and private domestic workers.
ACC premiums are calculated at a rate based upon the risk of accident for an industry category.
Donations
If you made financial donations to a charity, or paid for childcare or a housekeeper (in certain situations) during the last tax year, you can claim part of it back as a rebate.
For individuals, qualifying donations and voluntary school fees up to a maximum of $1,890pa a rebate of 1/3 may be claimed in any income year.
Donation rebates for individuals (minimum $5) are now made on form IR526.
Companies (other than closely held companies) are entitled to a deduction for donations made in any income tax year up to 5% of the company's net income. There are maximum limits available, please talk to us.
Entertainment
Entertainment expenditure is limited to a 50% deduction if it falls within the following:
Corporate Boxes
Holiday Accommodation
Pleasure Craft
Food & Beverages consumed at any of the above or in other specific circumstances eg. Business Lunches.
Working for Families Tax Credits
For 1 April 2007 to 31 March 2008: The calculations shown below are based on the eldest child being under 16 and all other children being under 13 years of age.
For more information on Working for Families Tax Credits (previously called family assistance) please visit http://www.ird.govt.nz/wff-tax-credits
Fringe Benefit Tax
FBT Rate 64% (or 49% for certain employees) of FBT value (income tax deductible)
Return Period Quarterly or Annually
FBT Value of Motor Vehicles:
When calculating the taxable value for motor vehicles, you will need to use either the actual cost price, or the tax book value.
From 1 April 2006 the FBT value of the benefit when using cost price reduced from 24% to 20% (or from 6% to 5% if FBT is paid quarterly).
Low or Interest Free Loans:
Benchmark Interest Rate (from 1 July 2007)
9.79% p.a (reviewable quarterly)
Goods & Services Tax
GST Rates
On supplies in NZ 12.5%
Zero rated supplies (eg exports) 0%
Exemptions:
Financial Services
Domestic Rentals
Wages/Salaries and most Directors Fees
Registration threshold - $40,000 turnover pa
Filing frequency threshold - Turnover exceeding $250,000 pa: 1 or 2 monthly
Filing basis threshold - Turnover exceeding $1,300,000 pa. must use invoice basis
PAYE on Salaries & Wages
If PAYE deductions exceed $100,000 pa, deductions from 1st to 15th month- due 20th of the same month and balance of monthly deductions are due the 5th of the following month. For deductions of less than $100,000 pa, PAYE is due 20th of the month following deduction.
Employee ACC Earner Premiums, Student Loan repayments and Child Support deductions payable follow the same rules.
Provisional Tax
Provisional Tax is payable in 3 installments unless a taxpayer qualifies as a new provisional taxpayer. Provisional tax is calculated at 105% of the previous years residual income tax (RIT).
For non-individuals, use of money interest is payable on shortfall of terminal tax from the 1st installment date until the terminal tax is paid.
For individuals, use of money interest is payable from the 1st installment date where their RIT exceeds $35,000 or the taxpayer has estimated their provisional tax.
Return Due Dates and Extensions of Time
Standard balance date taxpayers 'linked' to a tax agent have until the 31 March the following year to furnish their income tax returns under the extension of time arrangements.
Taxpayers with balance dates from 1 April to 30 September must file their return by the due date for the preceding 31 March year.
Taxpayers with balance dates from 1 October to 31 March must file their returns by the due date for the following 31 March year.
Taxpayers failing to file returns by the due date may lose their extension of time resulting in earlier return and terminal tax payment dates for subsequent income years.