How You Can Benefit By Hiring a Tax Consultant?

Importance of a tax consultant is always vital in any kind of business. Tax consultants are the persons who are certified to handle taxes of any individuals and company according to the state and country laws. They are the ones who can guide the company and individuals through proper steps to become eligible for tax rebates or tax refund.
 

Duties of a tax consultant:

The major duty of a professional tax consultant is to reduce the tax levy of an individual or a company as minimum as possible. A tax consultant assists its clients to compute their tax on by own or they do on half of the company. Professional tax accountant in Auckland will go through all the rules and regulations imposed by IRD and make the assessments according to that.
 

Benefits of appointing a tax consultant for your business:

Taxation policy is different for every country. It is also very difficult to understand by a normal person. Hence there is a need of an adept consultant to make the work easier for everyone. A consultant knows the laws and the tricks of preparing tax return very efficiently than a normal person.

Each consultant has gone through a training process from a good financial institution. This means they are certified and trained. It makes them eligible to provide right consultation to various companies and individuals. Hence you can be stress free and relax as your consultant takes care of your taxation process.

Computing taxation is a critical job to perform. It takes a good amount of time. Most of the companies especially mid sized and small enterprises do not like to spend that much of time into tax filling and computing it. Rather they prefer to hire a tax consultant to do the job for them.
 

Taxation structure is not constant every year. A professional tax accountant will keep himself updated with the latest updates. It becomes easier for any company or individual to leave entire responsibility on them to file company’s taxation.
 

A consultant apart from computing and filing taxation also provide advices and suggestions how to save tax by doing minor activities like giving donation, paying for health care etc. 

How to Utilize the Savings from the Tax Refunds in NZ

The New Zealand Inland Revenue Department (IRD) handles the all taxation affairs paid by individuals. A tax payer may pay more than the amount of tax that he has to pay from his income in advance. This phenomenon will make that individual liable to be eligible to get tax refunds. Many people are interested in getting their tax refund.

The calculation of refund is done by IRD on the basis of personal circumstances. On an average an individual gets about $500 tax refunds in NZ from the amount he pays. Some of the tax payers utilize this amount for paying extra payments like going for a vacation, doing Christmas shopping etc. But there are some other ways to save these extra bucks in a more fruitful way. Below I have discussed some great ways to spend your tax refund in New Zealand.

Paying off the high interest debt:

Look to pay off all the debts that you have pending.  You might find that the refund amount is not sufficient to pay off the entire debt amount. Try to use it for the account which is having higher debt interest. Paying off debt will be the best idea to enjoy your Christmas holidays with free set of mind. 

Pay the extra mortgage:

If you pay the extra amount on mortgage of your property that you have you can save a good amount of money for future interest. Paying extra amount on mortgage usually gets credited on the principal amount. By this way you can get the equity of the house as soon as possible. 

Save it for the future:

Save this extra money for the future. If you are having a saving account put this extra money into that account instead of keeping it in current account. Doing this you can get increased amount of interest. Keeping some reserved money can be handy when you or your family may come under any emergency. If there is any sort of financial crunch, this amount will be beneficial for that purpose. 

Spend wisely on repair and upgrades:

If you are planning to repair the engine of your car this is the right time to do it. Also you can upgrade your old Harley Davison by this extra amount gained from tax refund. Look into the aspects of any small repairs and maintenance works that you may require to be done for your house or office. Utilize the money and do it. This idea will also save your money for bigger expenses in future.

Above all are the different ways to use your tax refund income wisely. If you follow them, you need not have to be worry for your future. 

3 Ways of Proper Financial Management for Better Business Cash Flow

If you are into a business you need to think about this deeply. To make a business survive one need to put consistent flow of cash into the business. A good financial planning helps to maintain a good cash flow for a business. Here are some points that I have discussed on good financial planning for proper cash flow into the businesses. 

Make a proper budget:

Effectively prepare a budget for your business. Combine the actual, estimate and historical figures to ascertain the exact value for the budget. Make a list of all the expenses that took place in previous year, eliminate those which are not going to take place this year. Add cost of all promotions, campaigns that are going to take place in this year. Do not forget about the tax requirements of this year. Compute your tax from an expert tax agent in NZ to save extra bucks. Now calculate the revenue that you are going to incur during this year from the existing projects.

Review the terms of trade: 

Before commencing the business, the owner must decide the terms of trade. You may have terms of trade for 7 days, 14 days or 30 days. This is the time which you give to the buyers to pay the bills. It must be clearly mentioned on the invoice. Make your terms of trading written in simple language to avoid any confusion.  You need to mention it in the invoice 7 days after getting the product or 7 days after getting the invoice. Eliminate these kinds of petty confusions so that you have a clear idea of the time of getting your money. 

Check debtors’ accounts and impose good debtor control system:

Do you have regular late payers and payment dodgers? This system can harm your business a lot. Hence you need to apply a good debtor controlling system. Consult with a professional financial planner to imply some strategy to counter this. You can use automated reminder system on a periodic time for the clients. You or your assistant can send gentle reminder e-mails or mails to the clients asking to pay off some of their money now and rest can be paid later on. 

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. 

What is a Financial Statement?

A financial statement is a formal record of financial activities of a person, business or an entity. It is a financial report which quantifies a company or a person’s financial strength, liquidity and performance.

There are four kinds of financial statements-balance sheet, income statement, cash flow statement and statement of changes in equity.

Balance sheet presents the financial condition of an entity at a specified period. It comprises of three elements: assets, equity and liabilities. The income statement reports the financial performance of a company or a person in terms of net loss or profit over a given time. Also known as profit and loss statement, it comprises of two elements: expense and income. Cash flow statement is the movement in cash and bank balances over a specified time. This movement is classified into different segments like operating activities, financing activities and investing activities. Last but not the least; is the statement of changes in equity, which is also called statement of retained earnings. It details the movement in the equity of the owners over a certain period. This movement is derived from the components like net profit or net loss during a given period as reported in income statement, dividend payments, share capital repaid or issued at that period, losses or gains recognized in equity and effects of change in the accounting policy.

A relevant financial report needs to be presented by every company, person or entity and proactive accountants can help companies and individual clients in preparing these reports. For big corporations, these reports may be a bit complex but professional accounts can present them in a structured way and in an easy to understand form.

How to Find the Right Tax Accountant?

To handle your taxes you need to hire a professional tax consultant. But many people think that they can handle their tax on their own. Actually no one wants to hand over his financial data to an unknown person just like that. After all, maintaining accounts is a tricky affair. 

So, if you are planning to prepare a perfect tax statement, then you have to hire a professional tax accountant in Auckalnd. He can advice you the ways to get rebates on your final taxable amount. If you are looking for a good financial consultant you need to check out some merits before finalizing the consultant.

Make sure you ask the following questions to your consultant.

What is the experience of his job?

It is important for you to know since how long the consultant is working in this field. An experience consultant will be able to give you trustworthy and effective advices.
 

Does he has a license?
 

To become a financial consultant you must have a valid license. A consultant without a license does not have any authority to prepare according to the financial law of New Zealand.
 

What kind of tax job you are specialized in?
 

There are several tax consultants in the country, but not all of them do the same work. Some are specialized in offering Mergers and Acquisitions services where as others may be Chartered Accountant or Solicitors. There are even many other kinds of tax related jobs which tax consultants provide. You need to find the professional who is best for your need.

Does he outsource any work?

If a consultant outsources his works then there is always a scope of mishandling of data. This phenomenon can be harmful for any individual or a company.

How long shall it take to finish your tax return?

A consultant will prepare the financial statements within a stipulated time period. Ask him how long shall it take.

As you have finalized your choices, make a quick background check of the tax consultant. Consultant should not make any false promise. If your consultant is saying about big deductions, you must be wary about that. After all you shall be responsible for all the accountant details to the tax authority. 

Remember one more thing. There is nothing wrong in changing a tax accountant but sometimes we restrict ourselves from doing it.

Interesting Facts about Tax Refunds in NZ

Tax refunds are basically refunds on taxes. This happens when tax liabilities are less than taxes paid. Here we are going to deal with some interesting facts on tax refunds in NZ. 

When working in the country of New Zealand, you might have noticed that you had to pay a part of your earnings as income tax. You can get back some or all of this money.  The amount, which you are supposed to get back in NZ depends upon many factors like the amount that you have earned, the time span you’ve been working in NZ, the kind of work you performed and the amount of tax that was withheld from your earnings. This money is usually paid back at the end of a financial year. 

You will find taxpayers flocking to sites which promise tax refunds at the end of each financial year. Earlier it only used to be the entrepreneurs who used to think about taxes at the start of every financial year. But nowadays it’s also the salary earners who pay PAYE pay attention to this because many have found that they are due a refund for the overpaid tax. 

However, you can claim the refunds for past 5 financial years. There are several sites that offer the service of simple tax returns for the PAYE earners and propose them to IRD when refund is actually due. These websites take their charge as a cut of that amount refunded. There is also another option that people use today. It is the online service of IRD. This is free but they charge huge commissions. Using their service means you will need to give them a quarter of your payout as their commission. 

We are a licensed tax agent in NZ authorized to prepare income tax refunds as per the rules and regulations of the Tax Authorities. 

Is it Possible to Resolve Tax Disputes in New Zealand with ADR?

Resolving the disputes that arise from tax related issues in New Zealand is a time consuming and expensive affair. Presently, these disputes are settled by litigation or outside the court by agreement between the Inland Revenue Department (IRD) and the taxpayer. A process called ADR or Alternative Dispute Resolution if adopted will be of great benefit. The taxpayers can benefit a lot from the introduction of this element into the pre-litigation dispute method.  Ask your tax agent in NZ-he or she too will be of the same opinion.
 

The most prominent improvement would be to boost the conference phase by providing ADR. The conference takes place at the stage where parties have set out their positions but a legal action isn’t yet expected.

Although not legislated for but an essential administrative practice, the main aim of the conference is to recognize and elucidate the issues and facts in dispute. Conference could be easily supplemented by introducing a formal method and the usage of ADR technologies. On the whole, the aim would be to give conference stage much more substance by offering a great chance to settle the disputes without recourse to courts. There must be no obstacle to IRD participating in Alternative Dispute Resolution, it being empowered already for settling down the disputes in accordance with its management powers and existing care. Obviously HMRC is certain that ADR falls within parameters of its identical powers and responsibilities.

While ADR may fit naturally at conference phase, there is obviously no cause why it couldn’t occur before in the disputes procedure. It is however, illogical to pay no attention to the probable efficiencies, which ADR has the potential to bring. The confidential and non-binding character of ADR means, there is a minimal downside to either of the parties. If resolution can’t be attained, each party may conclude the procedure with a better understanding of other’s position. After ADR, the matters in question will surely be narrowed.