Accountants, Auckland, accountancy and taxation advice, Henderson, Waitakere

November
Tip Bits

In This Issue

Written by

Michelle Thompson

-    Money Personality

-    Fix or Floating

-    GST & Income Audits

-    Anonymous Information

-    Success Requires Inconvenience

        Resources

- Tax Dates

- Tax Facts

- IRD Website

        Featured Services

Use of Money Interest

Provisional Tax if we get it wrong because you have earned to much is really expensive due to Use of Money interest plus penalties. If your business has increasing profits please ask us if you should pay your tax earlier. The answer may well be yes you should.

Click here to book an appointment to discuss any business or tax problem with Michelle.

ACC Cover

Many invoices issued need an expert to check them. The default levies are often wrong. If you are interested in finding out more click here and contact us with your questions.

Trust Management

If you have any questions about your Trust I suggest you make an appointment for a interview to discuss how the gift duty changes will affect what you do with your Trust.

It is also a great time to set up a Trust and do all the gifting at once.

Contact us

Money Personality

Do you know your money personality?

Click below for a 5 min quiz that will probably confirm what you and we already know about your money personality.

http://www.sorted.org.nz/calculators/personality-profiler/

I am very sure our money personality does not change when we suddenly start running a business! Yet, to be money smart in business is absolutely crucial for long term success in meeting both your business and your personal financial goals.

How do you build a nest egg that will suit your lifestyle both now and in the future? How do you watch your spending, make a budget and actually achieve it? I am finding Xero personal which is online software readily available to all with a computer and internet. It is a great visual help to do this and much more and I would like to invite all my clients to start using this tool and become much more money smart with what you earn. If you want to know more click below to see a free demonstration.
www.xero.com/personal/

Click here for our special set up offer

Fix or Floating

I have been asked this question recently by those investing in property. I am watching the newspapers and every day there appears to be more economic uncertainty in Europe particularly with Greece and Italy. The kiwi dollar is being pushed all over the place, Dwelling consents in NZ are rising again but slowly, I am sticking personally to floating rates for my mortgage. I know some good economists who share this view. If you want to fix for 2 or 3 years you will probably find you will pay a premium interest rate to do so.

Floating Mort. Rate
10 year average = 7.9%*

Last Qter Prev Qter Latest Year Year ago 2 yr ago
5.59 6.09 6.09 5.59 6.49

Fixed Mort. Rate 3 yrs
10 year average = 7.8%

6.99 7.15 7.15 7.95 5.99

GST & Income Tax Audits

I recently attended a seminar run by a senior technical investigating auditor. The IRD hourly rate of recovery in their audit work for property investigations is just over $7.50 for ever $1 they spend.

Thankfully, I have not seen that rate of recover in any clients subject to an audit that we have worked on.

I found it interesting to know though that the IRD have 126 indicators that they sort taxpayers into when deciding what company to audit. Do you want to know a few of the top few red flags?:

- Overdue Tax Returns
- Overdue debt with the IRD
- Tips from the public (including ex partners)
- Working in specific industries known as problems to IRD
- restaurants, property, scrap metal,
- Voluntary Disclosures
- History of refunds followed by no income
- Showing wild variation from Key Performance Indicators against similar type of businesses.

If you don't fall into any of these - great the IRD are not going to tell us every indicator though - their list is very confidential.

Anonymous Information

If you suspect someone or a business is not declaring income or you believe is somehow cheating the tax system or committing fraud you too can send an information through the IRD website by just typing the keyword "anonymous" in the search bar.

This downloads a form which will be seen by an IRD audit investigator - you will never know the final outcome, however, you have done what you should do to make sure everyone pays their fair share of tax.

If however, my staff or I find evidence of fraud, or a client refuses to take our advice that a particular expense is not deductible or income is assessable then we simply have to decline to work for them. It is against our code of ethics to report this difference of opinion to the IRD. We can suggest to a new accountant though that there is a problem that we are not at liberty to discuss without the clients permission. This statement in a letter could result in a new accountant declining to work for the client too.

Success Requires Inconvenience

Inconvenience and discomfort can be expected as part of the foundational building blocks of success. Every person who has ever been successful has formed the habit of doing things that others don't like to do:

EG:

It is inconvenient to work out when you are tired – so what do most people do? They make an excuse and roll over.

It is inconvenient to forgive someone when I am hurt – so convenient to hold a grudge.

It is inconvenient to teach a child how to tie their shoes - so convenient and easy to provide them with slip ons.

It is inconvenient and takes time to cook a well balanced meal for your family….

Inconvenient to be tranquil in a traffic jam.

Inconvenient to accept 100% responsibility for my behaviour.

Inconvenient to tell the truth to ourselves and others - so convenient to lie or engage in avoidance.

It's inconvenient to go the extra mile for a client.

It's inconvenient to confront problems head on, instead of pretending they don't exist.

It's inconvenient to sacrifice and enforce self-discipline - so convenient to be lazy and to procrastinate.

It's inconvenient to break free from comfort zones.

Inconvenient to be open minded and understanding - so easy to be judgmental.

It is inconvenient to practice the golden rule. Far easier to be self centred.

The truth is none of us like to be inconvenienced. High performers understand that the road of success is filled with doing acts that are uncomfortable (at least in the beginning) and the acts that require self discipline. However, these people choose to do what needs to be done regardless of the inconvenience or discomfort to themselves.

Successful people are influenced by the desire for pleasing results. The majority of people are influenced by the desire for pleasing methods.

Be one of the successful people and embrace discomfort and inconvenience when you know it will lead you one step closer to success, fulfillment and achievement of your goals.