Welcome again to the McLean and Co. Newsletter in which we discuss current taxation and business matters. We trust you find it informative.  Any feedback would be welcomed.

This 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.

McLean and Co. has installed Norton Antivirus software to minimise risk of virus transmission in the provision of this service.

McLean and Co. is a home based chartered accountancy practice based in Clive, Hawkes Bay.    Readers are invited to peruse the practice website,  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 welcomed.



  1. Relevant Business and Taxation Articles

  2. Terminal Tax Reminder

  3. New Additions to our Website

  4. Income of $200 with less or no Tax Withheld

  5. Paying Family Tax Credit to the Principal Child Care

  6. Let the Buyer be Aware

  7. Review of Companies with no Directors

  8. New Rules for Taxpayer Financial Relief   



The 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:

To Lease or Own                                  

Improving Cash Flow                           

Reasons for Business Failures             

Family Trusts                                        



You 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.



We have recently added the following to our website:

Hawkes Bay Commerce and Attraction Links

Company Incorporation

Eight Steps to starting a Business          


From 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. 



From 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.



When 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.

McLean and Co., and no doubt many of the readers, have received a number of emails from "official" 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.

According 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 offered."

People should be wary of so called investment schemes which:

have no investment statement or prospectus.

promise very high returns

say the scheme must be secret in order to suceed.

give a few or no details about the issuer and how the money is to be invested

are "private" offers open only to a select few

claim that the invetment is "safe" or "risk free"

refer to "top world banks" or "prime banks'

If 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,



A 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)

Companies 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.

You can check your company's director listing at by selecting "Current 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.



The 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.

The 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:

IRDs role is to maximise the recovery of outstanding debt, but not if the debt recovery represents an inefficient use of of IRD resources or the recovery would place a taxpayer in financial hardship.

if IRD can collect more of the debt over time through an instalment arrangement than from a bankruptcy or liquidation, IRD is required to enter the instalment arrangement and any amount not recovered under the arrangement is written off as unrecoverable.

fairer instalment arrangements, including provision that late payment penalties stop when taxpayers contact IRD requesting financial relief.

amounts  not recovered are written off permanently, and generally cannot be reinstated.

the definition of a serious hardship in the legislation lists both circumstances which meet that test and circumstances which do not.

Taxpayers 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.

Paying 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:

payment in full.

an instalment arrangement where a taxpayer repays an agreed amount over time

writing off an agreed amount if IRD determine that payment in full would cause a taxpayer serious hardship

a combination of an instalment arrangement and a serious hardship write-off.


If we can assist further, please email McLean and Co as follows: