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New top tax rate for trusts – what does it mean for you?

Budget 2023 contained a few surprises, but the change to the tax trust rate wasn’t one of them. As had been hinted at a few times, Grant Robertson lifted the tax trust rate from 33% to 39%, bringing it into alignment with the top personal income tax rate. This change is from 1 April 2024.The change aims to make the tax system fairer – since the top personal tax rate increased to 39% there has been a 50% increase in the amount of money going through trusts.Which trusts will be affected?The&nb...

Profit improvement and productivity

Do you already track your gross and net profit but are at a bit of a standstill on how to increase profitability? Think about the relationship between business profit and productivity. You can increase profitability if you produce more and pay less for what you need to produce and sell your goods or services.It's not about cost cutting. It’s about looking closely at the value you get for what you spend and how you can best create value for your customers.Start with your fixed costs. You must p...

Keeping up with Fringe Benefit Tax

As an employer, if you provide fringe benefits to employees, or others associated with your business, you must generally pay fringe benefit tax (FBT) on the value of these benefits.So, when are you liable for FBT? Any time you provide non-cash benefits to your staff. The list is potentially endless but in practice, most non-cash benefits fall into one of these categories:motor vehiclessubsidised transportstaff vouchers/giftsoffsite carparksinsurance premiumsOf these, most FBT revolves around com...

Facing Increasing Mortgage Interest Rates

The challenge of increasing interest rates will be real to many. It might help to remember just 4 years ago the rates were higher – you survived then, and you will survive now. In the office this week we had a conversation about how we could respond to the increasing rates. Here are some of our ideas: Improving Efficiency   Discuss with your mortgage broker or banker what options are available to you. Perhaps fixing part or all of your loans, interest only for a time, ...

5 Reasons why…it’s good to take some time out

Life today is packed with things to do, think and stress about. We're generally living on high energy to keep up with life's’ demands and juggling too many balls. With a fast pace and demanding life and career, often we can forget to take a moment to stop, breathe and get some perspective.Definition of take time out: to stop doing what one is doing in order to do something else for a while1. Get PERSPECTIVEStepping away from day to day life and taking some time to yourself, be it an hour ...

How to make $25 per hour = $40 per hour

With the introduction of another paid holiday, the Mondayising of another and extending sick pay to 10 days, I was reflecting a conversation that I often have with a clients.  The conversation goes something like this….I pay my worker $25 per hourI charge them out at $45 per hour (*plus GST they say with a smile 😊)I’m making $20 per hour from them 😊That’s $800 per week –  even bigger smile 😊😊But I don’t seem to be making any money – sad face ☹It's then th...

Family Trust - Do we still need ours?

There has been a lot of commentary on the impact of the new act on Trustees and how they are now required to do SO much more!The reality is that a Trustee who approaches their appointment in the manner a reasonable person would and always acts for the good of the beneficiaries, has nothing to be feared with these new provisions.We suggest you consider the following factors, to determine if your trust is still relevant:What was the reason for establishing the Trust?Does this reason still exist?Wh...

Small opportunity to save some tax

Part of the governments COVID assistance to business was the increase in the threshold for immediate write-off of tools and equipment from $500 to $5,000 for all purchases between 17 March 2020 and 16 March 2021. This means that you get immediate deductibility for what would, under normal circumstances, be the purchase of an asset. The impact of this is best explained by an example:Suppose that you need to buy a new item of plant or equipment, a drill press or laptop computer or coffee...

Thinking about helping the kids get a start in the housing market?

Recently, we have been having conversations with Mums & Dads who want to help their children get into the property market. We love these conversations. Mums and Dads love their children, understand the good side and the not so good side of their children’s natures and of course want the best for them.Every family’s situation is unique, as is the type and level of assistance available. That said, here are a few guidelines/options to get you thinking how you might be able to...

The Benefits of Business Planning

All business owners know that one of the hardest things to do is take time out to review the health and direction of your own company, particularly in the busy times of the year. Perhaps as you go through the Christmas gifts you've received this year, you might give yourself the most valuable gift of all—setting aside some time in the new year to review your progress and book a business planning session.If you’re one or two years into your new venture, chances are you’ve already come ...

Thoughts at the holidays

As I reflect on the year that is drawing to a close, I thought I’d to share with you some conversations that I have been privileged to have with clients during the year. I've tried to be smart and tie it into an acronym of the word Christmas. Yes, I know it sounds corny, but here goes… Cash flow – Sales is vanity, profit is reality, cash is king! In truth, cash flow is the lifeblood of your business and when it comes to cash flow management, preventing cash issues is far easier than t...

Planning to make more money in 2019?

You need a budget.I could leave it right there because it doesn't come more straightforward than that. If you own a business, before you get too far into 2019 you need a budget.But I'm a chartered accountant, I would say that wouldn't I? Some people take a bit more convincing — especially when it comes to sitting down and preparing a budget for next year. It really is one of the most vital tools that will help you achieve your goals next year, so please stay with me. You'll be thankf...