NEWSLETTER JANUARY 2003
again to the
in which we discuss current taxation and business
We trust you find it informative. Any feedback would be welcomed.
is a free email newsletter provided without obligation on a regular basis.
We have a number of new subscribers this month and in some cases this email
newsletter is being sent without your prior consent, and your email address has
been acquired from published media. If you do no wish to receive future
editions of this Newsletter, click on the Unsubcribe below and provide the
information we have requested below and arrangements will be made so that you
will not receive it again.
and Co. has installed Norton
Antivirus software to minimise risk of virus
transmission in the provision
of this service.
and Co. is a home based chartered accountancy practice based in Clive,
Hawkes Bay. Readers are invited
to peruse the practice website www.mcleanandco.co.nz,
which lists services provided, gives contact
details and indicates how to become a client, contains an extensive base of
articles on business and taxation matters, and has links to other websites
that may assist your business. Being a small firm itself,
McLean and Co. strives to provide a personal and professional service largely to
a self employed person and small business client base. Enquiries are
Business and Taxation Articles
Additions to our Website
of $200 with less or no Tax Withheld
Family Tax Credit to the Principal Child Care
Buyer be Aware
of Companies with no Directors
Rules for Taxpayer Financial Relief
BUSINESS AND TAXATION ARTICLES
McLean and Co. website contains an extensive number of articles prepared by
McLean and Co. relating to taxation and business matters.
Here are a selection that will be of interest:
are reminded that if you are liable to pay 2002 Terminal tax, and if you are
not represented by a tax agent, or if you are represented by a tax agent and
you have lost extension of time, that this tax payment is due February 7.
ADDITIONS TO OUR WEBSITE
have recently added the following to our website:
Steps to starting a Business
OF $200 OR LESS WITH NO TAX WITHHELD
the 2002-2003 income year, the requirement to file an IR3 income tax return
has been removed for taxpayers with small amounts of income from which no tax
has been withheld. This applies where the total amount of this
income is $200 or less, before any allowable deductions. For
example, a person who works full-time for a salary is not required to return
income from a one-off cash job of $150. However, due to other
reasons, they may still receive or have to request a Personal Tax Summary.
FAMILY TAX CREDIT TO THE PRINCIPAL CHILD CARER
the 2003-2004 income year, family tax credits will only be paid to the
principal child carer. Previously, family tax credits were paid to
both spouses in two-parent families.
THE BUYER BEWARE
investment returns are more modest, investors are invariably tempted to
consider higher interest alternatives. However, be sure to
look before you leap. If an investment sounds too good to be true, it
may just be.
and no doubt many of the readers, have received a number of emails
sounding people from the likes of Nigeria and other African countries. They
say they only want your bank account number and in return promise to make you
a millionaire. However, once you are involved, they will require large
"advance fees" from you in order to "complete the deal".
People here and overseas have lost thousands of dollars buying into these
schemes, so beware.
to the Securities Commission, reports of investment schemes promising high
returns are increasing. "Uncertainty in the sharemarket
creates an attractive climate for the peddlers of illegal investments such as
prime bank schemes," Chairman Jane Diplock said.
"Their offers of high returns from secret schemes seem very attractive.
They are often entered into by people who otherwise consider themselves
prudent investors but who are lured to these scams by the interest rates
should be wary of so called investment schemes which:
no investment statement or prospectus.
very high returns
the scheme must be secret in order to suceed.
a few or no details about the issuer and how the money is to be invested
"private" offers open only to a select few
that the invetment is "safe" or "risk free"
to "top world banks" or "prime banks'
you are approached with an investment that is too good to be true, you can see
if it listed about dubious investment schemes published on the Securities
Commission website, www.sec-com.govt.nz
OF COMPANIES WITH NO DIRECTORS
recent review of the New Zealand Companies Register by the Companies Office
highlighted approximately 150 companies that had no current directors on
record. That is inconsistent with Section 150 of the Companies Act 1993
which provides that a company must have at least one director.
Under Section 128 of the Act, the business and affairs of a company must
be managed by, or under the direction or supervision of, the board of the
company. The board of a company is comprised of its director(s)
that have no director on record are therefore subject to removal by the
Registrar, and the Registrar has contacted all companies highlighed by
this review, and in most cases has received notices of new director
appointments. There are, however, a small number of companies that
remain in this "director-less" state. The Registrar will
soon commence action to remove these companies from the Register.
can check your company's director listing at
Name Search" and locating your company using one of the search options.
If you have registered more than two directors, you can see a full list by
selecting the "All" tab.
RULES FOR TAXPAYER FINANCIAL RELIEF
Taxation (Relief, Refunds and Miscellaneous Provisions) Bill containing the
changes to taxpayer relief provisions was enacted on 17 October 2002 and is
applicable from 1 December 2002. The new taxpayer financial rules
provide a framework for IRD to consider how best to provide relief for
taxpayers in financial difficulties. They provide IRD with
considerable flexibility in their approach to debt recovery and to allow IRD
to reach a decision which is both right for IRD and the taxpayer.
effectiveness of the changes relies on and encourages taxpayers to contact IRD
as early as possible if they think they will have trouble paying their tax
bill or are already in debt. The key features are:
definition of a serious hardship in the legislation lists both
circumstances which meet that test and circumstances which do not.
may apply for relief either in writing or over the phone.
IRD will discuss their current circumstances, consider their payment history
and their ability to meet future obligations, and determine the best option
for dealing with the current amount due.
a tax bill by the due date is obviously the best option bif if taxpayers cant
pay, the sooner they contact IRD the less it will cost over time. There
are a range of options available for paying the amounts due. IRD
take the taxpayers individual circumstances into account in reaching a
decision and the form of relief granted depends on the applicant's financial
situation. The options for apayment are:
instalment arrangement where a taxpayer repays an agreed amount over time
off an agreed amount if IRD determine that payment in full would cause a
taxpayer serious hardship
combination of an instalment arrangement and a serious hardship write-off.