The end of the financial year is fast approaching.  This is a good time to consider your year-end accounting and tax position.  If you want to minimise your profit or tax or check that you have paid enough during the year, it is best to start thinking about it before 31 March.

Below is a checklist of items you should consider before 31 March, some of which may help you reduce the amount of tax you have to pay for 2017 and some of which may make the year-end accounts process faster.

In  last year's budget there were a number of measures designed to simplify the tax processes.  These have now been enacted and in this post we cover those changes that come into effect from 1 April 2017.  As with all tax simplification, sometimes the result imposes extra burdens on business owners.  Labour- hire companies is a case in point.

While some of the changes will start from 1 April 2018, here's a short outline of the changes that come into effect in April 2017.

We have been noticing increased IRD investigation and review activity over the past year.  This is not unexpected because the government has been putting increased funding into this area from the last few budgets.
 
 

IRD has issued their views on what level of profits in a service business should be allocated and taxed in the hands of the owner, in light of last week's Supreme Court decision in the Penny & Hooper case.  There are potentially a huge number of businesses that IRD might investigate to determine whether tax avoidance has occurred.

I have just received a copy of the Supreme Court judgement on the Penny & Hooper case.   This case is an important one for anybody that makes a living from selling their personal skills & expertise.  Around 2000, there would have been a number of people who switched from sole-trader status to working via a company structure.

Last week I was watching a TV programme which served up a  valuable business lesson.   Here's what happened.  Three B & B owners stay at each others places for a night.  In the morning, they can decide how much of the standard tariff they think the experience was worth.  They also provide comment on what they liked or didn't like.   Participants were a young couple just starting out, a posh lady who used to run a finishing school, and a down-home older couple.

The draft legislation for the changes to the Qualifying company regime came out on 15 October, and the government is hoping to get the legislation passed before Christmas.  From 1 April 2011, then LAQC’s will no longer exist, so everyone who currently has a LAQC will have to make a decision on how they will structure their operations going forward.