New Zealand Company and Business Tax Returns
If you operate a business in New Zealand it is likely you will need to complete a New Zealand income tax return for the New Zealand activity.
As to what “operating a business” actually means can depend on the circumstances. However, if you have a base in New Zealand such as an office (even a virtual office) that may matter.
Under the double tax agreement that exists between New Zealand and Australia, there are also “deemed” circumstances where, even if you do not have a location in New Zealand, you may still be required to file an Income Tax Return on the New Zealand activity.
There are further changes taking place effective 1 July 2018 which may bring more Australian-based businesses under the New Zealand tax net.
Therefore, if you believe you are not required to file a New Zealand income tax return, you should really contact us for a quick discussion to bring about some certainty. New Zealand’s penalty regime should not be ignored and, as they say, ignorance is no excuse.
If your activity is required to file a New Zealand income tax return it is important to have exactly the right structure in place for your circumstances.
We can provide you with advice on the best structure which takes into consideration the New Zealand and Australian tax rules. And we can guide your Australian advisor, explaining what we do, why we do it and the impact in Australia. Although we do not prepare Australian tax returns we probably understand the rules between New Zealand and Australia better than most.
Unless your business was set up with due regard to both the New Zealand and Australian tax rules, you are probably paying nearly twice the tax you should be.
Registering your Australian company in New Zealand is the easiest means of establishing a legal presence over there, and is often recommended if you happen to contact the New Zealand Companies Office. But unfortunately, if you are a small Australian-controlled company, you are setting yourself up to pay tax in excess of 60-70 cents in the dollar.
As well as ensuring you are utilising the most effective and legitimate tax structure for your purposes, as New Zealand registered tax agents, we can also prepare and lodge all types of New Zealand tax returns through our dedicated tax management system.
We Can Invoice You In Either Australian Or New Zealand Currency
Our prices are quoted in Australian currency. But if you prefer, you can pay the New Zealand equivalent on any or all of our services. We accept both Australian and New Zealand currency and can model our operation so that you can receive your invoice with either New Zealand or Australian GST.
Extension of Time
Yes, we can even offer extension of time for New Zealand Income Tax Returns.
As a registered New Zealand tax agent, we have the privilege of extension of time which we can offer to most clients.
We will not be able to offer it to you if you have been late in filing a tax return and Inland Revenue have assessed a late filing penalty. Therefore, please get in contact with us before that penalty is applied and we can take the heat of you, giving you more time to get your records in order before we prepared the Income Tax Return on your behalf.
Our extension of time arrangement can give you an additional 9 months to have your New Zealand Income Tax filed before late filing penalties apply.
Income Tax Returns
Our usual fee for preparing the financial statements to the standard required by Inland Revenue and preparing the New Zealand Income Tax Return is $1500 +GST.
Our estimate for a very small businesses with low turnover (usually less than $800,000) is $800 +GST.
We make it a point of looking through the financial information that has been provided for the common errors based on the different tax rules that exist between New Zealand and Australia. We ensure all costs that can be legitimately claimed are being claimed.We always fix the price with an emailed proposal before we start work on your New Zealand tax returns so you have absolute certainty.
You might also want to have a look at our all-inclusive XERO packages where we can look after your various New Zealand tax requirements on a fixed fee package. Simply click on this link for details of our New Zealand XERO packages.
Don’t use Xero? Our clients use all sorts of accounting packages and we work to fit in with them.
We can even prepare your Income Tax Returns based on reports provided by Australian tax agents and bookkeepers.
Our fee for completing a New Zealand GST return is just $175 +GST.
Because of our experience in this area, we can also often assist in speeding up GST refunds. This is because we assist with a lot of Australian businesses completing their New Zealand GST returns and are fully versed in the particular information Inland Revenue investigators require in order to confirm that a GST refund should be made.
We can also review your business activity to ensure you are correctly registered for New Zealand GST. Just because Inland Revenue has registered you for GST doesn’t mean you should be. We can give certainty to your registration to minimise the chance of any penalties being applied down the track.
We can suggest alternative structures that can help you meet your desired objectives where that is possible.
For more on New Zealand GST and how we can help, see our NZ GST page.
Employer Payroll Returns
If you are employing staff in New Zealand and need to account for their PAYE withholdings, we can assist by preparing payroll and advising you on the amounts to pay Inland Revenue along with the Kiwi Saver (New Zealand superannuation scheme) contributions.
You should note that the New Zealand superannuation scheme isn’t comparable to that of Australia. As well as the employer contribution being limited to 3%, employees are also required to make a similar contribution. That being said, there are exemption opportunities for employees which will also exempt an employer from having to make those contributions.
New Zealand doesn’t have awards to rely on when determining payroll conditions like Australia does. Therefore, there is no automatic requirement to pay penal rates (time and a half, double time, etc) or additional rates for working on statutory holidays.
For details on our payroll processing options, you should visit our NZ payroll page.
Fringe benefit tax is payable in New Zealand however the rules are not the same as Australia. Therefore, you should ensure that when there are non-cash benefits being provided to employees or the owners you receive the appropriate advice as to whether there is an Income Tax or Fringe Benefit Tax obligation.
Our fee for completing an FBT return is $200 +GST.
Non-Resident Withholding Tax
There are many instances where Australian residents who are paid by New Zealand businesses may be subject to accounting for non-resident withholding tax which can appear under a number of categories.
The Australia New Zealand double tax agreement also covers particular circumstances and rates that apply for certain transactions between the two countries.
We are here to help you get a better understanding of how the New Zealand tax regime impacts on your small New Zealand activity.
We can advise on your obligations. We can also advise how to legitimately set up a small company in New Zealand to minimise any adverse impact.
NZ Tax Period
The New Zealand tax year runs from 1st April to 31st March. If you would prefer to use the Australian tax year end of 30th June, we can assist in applying for a change. That being said, there are advantages to leaving it as it is. Talk to us and make the right decision.
NZ Business Setup
No matter what structure suits you best, we can assist you to ensure that it is robust and complies with New Zealand legislation.
Whether you want us to complete the registration process for you, draw up the necessary resolutions and agreements or provide a New Zealand address with online access to your statutory records, we’ll be able to guide you all the way.
New Zealand does not have the equivalent of Australia’s tax simplification scheme. Profits must be calculated, for income tax purposes, based on the accrual basis. The accrual basis accounts for profit when the invoice is generated-not paid.
Charging a management fee to a New Zealand entity may help to reduce taxable profit but may also result in significant penalties.
Contact us for more information on how to meet the requirements and reduce your profits without being penalised. We can explain the limits that apply to management fees and how best to ensure the New Zealand entity meets it’s fair share of costs.
Subsidiary vs NZ Company
Ensure your company is set up correctly for tax purposes or you will be double taxed. We generally do not recommend registering your Australian company in New Zealand and the use of subsidiaries isn’t always a good idea. Chat with us and potentially save thousands in tax.
NZ Tax Registration
We can help you ensure you are registered for the right New Zealand taxes and account for them correctly. New Zealand doesn’t have an integrated system like Australia where a number of taxes can be accounted for on a BAS statement. Every tax has its own payment date and reporting cycle. You could be making 3 payments on different dates in the same month. Download our App for NZ tax reminders.
New Zealand Tax Payments
We can even assist with helping you meet your income tax payments! If you would rather retain money in your business to fund growth rather than meeting provisional tax payments or even final income tax payments, we can provide immediate finance of any amount between $2,000 and $4 million. We use an Inland Revenue Department-approved scheme which means you can access funds for as little as 5% which stay off your balance sheet (and therefore doesn’t impact on other credit arrangements). We don’t even need you to sign agreements.
And, if you have just faced an audit and have been re-assessed NZ GST or Income Tax along with penalties and interest, we can usually provide backdated finance which means Inland Revenue’s interest bill (currently in excess of 9% per annum) will be reversed even if the GST return reassessment dates back several years.
For more information on how we can help pay your tax, take a look at our NZ Tax Funding page.
Questions about New Zealand Tax?
Our New Zealand tax expert, Mike Reddy, is a New Zealand Chartered Accountant and New Zealand Registered Tax Agent based in Sydney. He works with individuals and small businesses throughout Australia to help take care of your New Zealand tax questions and tax returns from our Sydney office.
Having been preparing and filing New Zealand tax returns since 1994, Mike is the most experienced New Zealand tax agent in Australia. He is regularly engaged by Australian tax agents and accountants who have clients with New Zealand interests.
So when it comes to looking after your New Zealand affairs, Mike can definitely help you with the right advice.
Call us now on 1300 791 600. There is no charge for a quick chat so we can talk you through the issues.