McLEAN AND CO.
The Importance of Accounting www.mcleanandco.co.nz/Page63.htm
Goal Setting in Business www.mcleanandco.co.nz/Page81.htm
Creating a Successful Niche Market www.mcleanandco.co.nz/Page83.htm
Setting Prices www.mcleanandco.co.nz/Page105.htm
Current Tax Rates www.mcleanandco.co.nz/Page4.htm
FREQUENTLY ASKED QUESTIONS ON STARTING AND RUNNING A BUSINESS
Is the money I put into my business taxable?
No, this money increases your investment/ equity in the business.
Do I need to keep receipts for expenses worth less than $50?
Yes, you need to keep records of these supplies in order to include them in your income tax return, but you do not need full invoices for them.
How do i claim for the equipment I purchased before I started the business?
For income tax purposes, introduce it at cost price and claim depreciation. In claiming the GST component, you can normally claim the lesser of cost or open market value. (Note that in either case, if you received the item as a gift, the value is Nil so you cannot claim either depreciation or GST.)
When do I pay tax on my own wages?
If you are a sole trader you do not receive a wage. Instead you take drawings from the business. You do not pay tax on your drawings directly, but you pay tax on the profit from your business, which includes your drawings. Drawings do not qualify as an expense that you can deduct against your income.
In a partnership, rather than receiving a wage or salary the partners share out of the net profit at the end of the tax year and then pay income tax on their share of the profit in their individual tax return. However, a partnership can treat payments to a "working partner" as a wage or salary if the working partner is payable for their services, and the working partner personally and actively performs the services for which the payments are made in the partnership.
If you are a shareholder in a company you may be paid a wage periodically or at the end of the tax year.
When does my hobby become a business?
You are probably operating a business if you charge other people for the goods / services you produce, you supply your goods/ services on a regular basis and you intend to make a profit from supplying your goods/ services.
I'll be using my vehicle regularly for business reasons. Can I claim all my expenses for it?
Record all business uses of your vehicle in a logbook for three months. If the logbook shows that you have used the business entirely for business, then you can claim all your vehicle expenses against your business income.
I will be using my vehicle for my business. What expenses can I claim?
If you are a sole trader or a partner in a partnership, you can claim the running costs of a vehicle you use for business. If you use a vehicle strictly for business, you can claim the full running costs without making any adjustments. If you use it for personal travel (e.g. from home to work) you,ll need to work out the business share of the runningtcosts by keeping a log book that details the business trips undertaken in the vehicle. Examples of expenses you can claim are fuel and oil, repairs and maintenance, tyres, insurance, registration, warrant of fitness, road user charges, loan interest, depreciation.
I will be using part of my home to run my business. What can I claim?
You can claim a percentage of your household expenses based on the percentage of the area of the house that is set aside for your business. For example, if you dedicate a room to your business that is 11% of the total floor area of your house, you can claim 11% of your rates, insurance, power, mortgage interest and depreciation.
The Companies Office is currently reviewing incorporated societies that are not up to date with filing their annual financial statements. In June this year they sent reminder letters to societies that had outstanding financial statements. They had an excellent response to this initial reminder with more than 10,000 societies filing outstanding financial statements, but there are still a number of societies with outstanding financial statements.
It is important that any incorporated societies with outstanding financial statements file them by the end of November 2003 or the Registrar of Incorporated Societies will take steps to declare the societies dissolved (removed from the register). This is also an opportunity for incorporated societies to update their contact details if they are no longer correct. If it will not be possible for a society to file outstanding financial statements by the end of November, please contact the Companies Office on free phone 0508 762 438 to discuss alternative dates.
If a society is removed from the register while it is still active, it can affect:
There is no fee for filing financial statements, but it costs $200 to request that a declaration by the Registrar dissolving a society be revoked.
You can check if a society you are involved with, or act for, is up to date with its filing requirements under the Incorporated Societies Act 1908 by either:
If a society is no longer active, please let the Companies Office know so that it can be arranged for them to be declared dissolved.
Forms for filing financial statements, updating a society’s contact details or requesting a society be removed from the register (declared dissolved) can be accessed in the "Information Library" at www.societies.med.govt.nz.
If you have any questions, please contact the Companies Office on free phone 0508 SOCIETIES (0508 762 438) or email at email@example.com.
INLAND REVENUE DEPARTMENT 2002-2003 REPORT- OVERVIEW
In 2002- 2003:
SMALL BUSINESS DEBT COLLECTION STRATEGIES
Coping with ever increasing costs is one thing - making sure you get all the money that's due you from customers or clients is another. Here is how maqy business owners deal with the problem:
ACC CORPORATION- THINGS TO ADVISE THEM ABOUT
Heres some things you should advice ACC Corporation direct about:
ACC Corporation's telephone number is 0508-426837.
ACC TIME OUT FOR EARNERS
Earners planning on taking a break from employment or taking unpaid leave from work for more than two weeks (e.g. for an overseas trip, or study leave) need to think about income protection. They will not be eligible for weekly compensation if they are injured after the first two weeks of unpaid leave.
This is because they will be classified as a non-earner at the time of injury (therefore not eligible for weekly compensation).
ACC Corporation has a product called ACC Time Out for people taking a break from work. A minimum of three months and a maximum of five years cover can be purchased. The person can choose to be covered either immediately from the date of incapacity (following a one week stand down period) or to defer this cover to when they are able to return to work. The person must be in continuous employment for 12 months prior to application.
If we can assist further, please email McLean and Co as follows:
CONTACT McLEAN AND CO. BY EMAIL BY CLICKING ON THIS LINK
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