Know About the Reporting Compliance and Tax Framework for Overseas Firms Operating in NZ

For the companies that want to do business in New Zealand, it’s essential to have an understanding of both the tax framework as well as the financial reporting. This overview is only a brief glance at the crucial areas and we recommend discussing about these with a professional tax accountant in Auckland. 

Financial reporting

The financial reporting compliance with respect to the overseas firms doing business in NZ is straightforward. The considerations mainly include: 

1. Registration with NZ Companies Office
   
   Before anything else is done, it is important to register the business with NZ Companies Office. This must be done without a delay as you will have only ten days from the day when you start the business first in NZ for registration.
   
   
2. Submitting the audited annual accounts to Inland Revenue, which are NZIFRS
   
   Work that is involved here may be quite onerous and involving. Talk to a professional accountant and simplify the method and avoid any kind of unpleasant surprises about scale of the financial reporting needs in New Zealand.
    
3. Submitting the annual returns through an online form
   
   
4. Maintain the accounting and statutory tax records. These requite to comply with the tax obligations and requirements of the IFRS. 

Tax framework for businesses or non-resident contractors who are in New Zealand for less than six months

1. If a business is in NZ for less than six months, the tax implications are generally straightforward and light then. The framework given below identifies the obligation areas:
   
2. If a company is importing goods to NZ, the company will need to consider the GST and NZ Customs duties.
   
   
3. If staff is being brought to NZ at this span of time, they will become liable to tax, triggering the employment tax implications like FBT, PAYE, ACC etc.

Staffs who are employed in New Zealand may not necessarily be charged to pay tax. It will depend on their circumstances.

Tax framework for businesses that are in NZ for more than six months

Companies will be taxable in NZ if they are operating here for more than six months. However, in some cases it is even twelve months. They will become liable to pay income tax, GST on New Zealand sales of services and goods, submit annual tax returns for their business etc. 

Which Kiwis are eligible to apply for working family tax credits?

Tax credit is a proficient way to save some extra bucks for the year. Tax credit for working family has been introduced in New Zealand in the year 2004. The purpose of introducing this act was to ensure that every family in NZ is having adequate income to support their families. If you are having children below 18 years and are solely depending on you, you can apply for a working family tax credits. A good tax agent in NZ will guide you the proper way to compute your annual tax.
 

Find here the criteria to avail the credit:

If you are a paid employee and you earn less than $70,000 pa you are eligible for this. You can also get pre-school, out of school, and recreation subsidies depending on the condition of your family. There are four types of payment methods.

If a family is having depending children and they are on paid employment then they are eligible to avail this benefit. The deduction will depend on the age of the children. Families with low income will get some money to upgrade their income up to the minimum income level.

Parents working 30 hrs a week or sole parent working 20 hrs a week are available for tax credits. 

If your net family income is $22,568 or less and as parents you work 30 hrs a week, then you are eligible for the tax credit. The purpose of tax credit is to ensure that a family earns minimum $434 per week after paying the tax.

Parental tax credit of upto $150 in a week is paid for eight weeks after a new baby is born. This is done to assist the cost of a newborn, provided that you are availing paid paternal leave.

How to Find Small Business Advisors?

Financial projections, taxation, company formation and when and how to invest in properties are a few of the issues that small business owners often face. Fast-growing firms and startups in New Zealand face even more challenges and that is where the role of business advisors in Auckland comes into play. Whether they are helping with company formation or managing the taxation, the small business advisors are expert individuals who help with important operational decisions and strategic business planning.
 

Here are a few tips for you to find small business advisors for your company. 

Look for a person who has experience in managing a small business

Small businesses are very much different from large corporations. Find someone who can understand the challenges of small business like budgeting and cash flow, capital funding, maintaining annual accounts, income distribution, taxation and others. Moreover, look for someone who had been able to achieve success with biggest business challenges. For example, if your main roadblock is preparing financial statements, target an advisor who is expert in preparing financial statements.
 

Choose a consultant with credentials 

It is not necessary to have a license or degree to be a business advisor and give suggestions to people on how to run and manage businesses. Anyone can set up a company and start giving advices to businesses. However, you should always look for someone having a business degree like Chartered Accountant, MBA and such others for your peace of mind. People having these degrees are sure to provide a much better advice then common people with no such business qualifications.
 

Go for a business advisor who focuses on your niche

A consultant who specializes in your industry will be able to understand your business better, speak your language and know the competitive umbrella that your company operates under.
 

Ask for referrals 

Ask your work associates, social networking members or your mentors whether they know someone who can help you with the business advisory services that you are in need of.