What is the Future of Accounting & Role of an Accountant?

Accounting is completely dependent on technology these days. Technology plays a vital role in today’s changing business environment. And there is no doubt accounting has been part of this. Over the past few years, there have been significant changes in accounting world. Yes, accounting wasn’t easier earlier than what we are doing these days with just one click.

In the article Making Tax Simpler “Better Administration of PAYE and GST”, the Government have introduced new proposals to improve the tax systems in New Zealand. Such changes relates to PAYE and GST.

The most significant improvement they want to make is to “use modern digital technology to provide faster, more accurate and convenient interactions with Inland Revenue”. This means that they want to integrate PAYE and GST filling process into accounting software.

Online GST changes and its impact on taxpayers.

According to the Revenue Minister, Todd McClay, the Government is looking at a way to charge GST on cross-border services, intangibles and goods with the focus on collecting GST from overseas suppliers of online products such as e-books, music and videos and GST on low-value imported goods. At present, there is no GST charged on overseas online- service provider and low-value of imported goods.

The purpose of this tax is to create a fairer competition for domestic suppliers and increase revenue for the government. Globalisation means the big world becomes smaller, as you can do business, buy and sell anything with people around the world. The number of New Zealanders buy goods and services from overseas have increased substantially over the last few years. Mr McClay claims that the GST foregone on overseas purchased is around $180 million a year and it is growing at around 10 percent each year. Moreover, the new rule is also fairness. Currently, overseas supplier is benefiting as there is no GST charged on their goods and services, so they can charge a lower price compared with New Zealand suppliers who have to include GST in the sale price.

From 1 October 2015, the Parliament introduced some changes to the property rules called as Bright-line test. The purpose of the test is to reduce the number of foreign speculators on NZ property and thus maintain positive housing prices of big cities in New Zealand. This rule only applies to residential properties bought on or after 1 October 2015. The idea behind the test is that taxpayer has to pay tax on the gain when you selling your property (with some exceptions). By taxing on the gain, it somewhat discourages speculators for housings as the profit is not as good as before.

Residential care subsidy:

What is it?

Residential care subsidy is a programme to help people aged 50 and over who need long-term residential care in a rest home or hospital to afford for the cost of care. You may be able to get the Residential Care subsidy if you:

IRD has recently launched an audit campaign on traders of Trademe. Together with Trademe, they are seeking and exchanging information of trademe traders who are ignoring their tax obligations. The most common problem we have seen is that traders started as a hobby, but with regular pattern of selling this was transformed into a business. 

Budget 2015 bring new property tax rules

The Government will give extra $29million to the IRD in Budget 2015 for the property tax compliance activities. This is mainly to ensure property speculators also pay their fair share of tax, which is currently by enlarge being avoided.

With the purpose of improving the current tax system, the Government has introduced some proposed changes to modernise New Zealand’s tax administration. These changes will make a huge impact on business, individuals and social policy customers in New Zealand.

A tax audit is an examination of your financial affairs to check you have paid the correct amount of tax and you are complying with the tax laws. It could be a small check of GST or a full audit check on your business.  IRD may choose random business to start the audit and in the audit, there are some certain rights of a taxpayer.

The National Party planned to introduce a stable tax system, without making drastic changes to the minimum wage. The level of minimum wage impacts the level of unemploymen in the economy. National considers a number of issues non-negotiable. Among them are (a) No Capital Gain Tax (b) No change in GST (c) Reduction in Company Tax Rate in the long run.Loss-making start-up companies are supported by new tax rules that help them to cash out all or part of their tax losses from R&D expenditure. Inland Revenue Department (IRD) has larger outlay to target property speculators and others avoiding tax, making the system become fairer for everyone.

Office 365 is cloud-based office software developed by Microsoft. It is the same Office you already use every day, but powered by cloud.‘Cloud’ means the data is stored in remote storage centre and you can access to your files from anywhere with internet connection. Also, your software setting will be the same in every device.

Companies going into voluntary or forced liquidation may have limited liability (the extent of the money invested) but such limitations do not cover the taxes due to the Inland Revenue Department (IRD). 

For instance, if a Company with $1000 as capital collapses, the liability of its Directors would be limited to $1000.

However, such limitations would not apply to IRD.

As a leader in a small business operation, your employees rely heavily on you for guidance and they also have a large stake in the success of your business. Nearly every employee-related performance depends on effective leadership.  Ineffective leadership can disrupt the employer-employee relationship, making it harder to achieve business goals. Therefore, it is vital to have good leadership skills.

Minimum family tax credits are mainly available to low income earners. Minimum family tax credit is a payment made to families with dependent children aged 18 or younger, so they have a minimum income of $438 a week after tax ($22,776 p.a. from 1-4-2014).

When an accountant tells you ‘I will do your accounts.’ what does that actually mean? To answer this question, I need to start from explaining what an accountant is doing. Basically, in terms of a small business, what an accountant does is book keeping, bank reconciliation and reporting.

In this article we will introduce a time management tool called priority matrix. You can have try and see whether it is the right one for you.

Some people set up a family trust to receive residential care subsidy when they get old. By setting up a trust they dispose their interest in an asset to be eligible to receive subsidy. With changing rules of social security it is getting harder to get residential care subsidy.

With the abolition of gift duty you can gift as much as you want and there will not be any tax duty. However, for residential care subsidy there still is a maximum level of gift per couple is $26,000.

What is residential care subsidy?

Residential care subsidy is paid to rest homes or hospitals directly for entitled people by the Ministry of Health.

When a business wants to upgrade its computer, it is easy to become confused by the technical data. In this article I will provide you some basic information that will help you to choose a right computer for your business.

Choosing a PC is actually choosing its hardware. For office use, it is mainly about choosing RAM, CPU and hard drive.

Healthy body means healthy thoughts for business

Mobile application – Moves is awesome to record  your daily activity.

This life style changing APP records real time information and its name is Moves. It tracks your everyday life and exercise. What you should do is just carry your phone in your pocket or bag.

This app automatically records your daily walking, cycling and running. It is able to recognise places in your daily life. It will generate a visualised report showing how you spend your day.

 With the app, you can see you every day exercise and review your lifestyle. You can start with small changes that can lead to a fitter lifestyle and healthier habits.

Link: https://www.moves-app.com/

Look through company (LTC) is a fairly new concept to our tax system which was introduced in Budget 2010. Basically the main purpose of introducing LTC is to strengthen our tax system by putting a cap on loss attribution rules.

Look through company rules were applicable from 01/04/2011 onwards and only apply to New Zealand resident companies.