Gail McIntosh Accountants Limited - Tauranga City

Gail McIntosh is a Chartered Accountant and a Member of the New Zealand Institute of Chartered Accountants. Gail McIntosh holds a Bachelor of Commerce and is a Member of the Chamber of Commerce.Year End Tax Planning Here are a few tips to reduce income and therefore income tax for the year ended 31 March 2008. Bad Debts - In order to have a write off for bad debts the debt needs to be actually written off prior to the year end. Merely providing for the probability of non payment is not sufficient to obtain a tax deduction. Remember the test for writing off a bad debt requires that there is no reasonable likelihood of payment. Holiday Pay and Bonuses -Consider paying out all employee costs before year end. This includes holiday pay and bonuses. If this is not possible, calculate the  

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amount now to accrue the liability the accounts at year end and ensure it is paid out within 63 days of balance date. (31 March) Prepayments - Some expenditures (within limits) are deductible even if prepaid as at 31 March. Examples include insurances, rates, stationery, rental obligations and advertising. Consider asking suppliers for invoices dated prior to 1 April covering goods and services (as above)required by your business after that date. Capital Expenditure - Remember the limit for capital expenditure that must be written off over the life of the asset is now $500 +GST. So for assets under this amount buy them now to get the tax deduction. Staff Changes There's a 'new' face in the front office - Mike will be the first point of contact for clients visiting the office. Also he may be able answer your questions when you telephone us.If we are engaged with clients please leave a message or email us on [email protected] Your Business Structure With the new IRD rules aligning GST and provisional tax payments, for individuals only, this is a great time to consider if you need a company for that and other reasons. The beginning of the next tax year is a good time to start that so give us a call, now, to discuss what’s best for you – we can form the new company for you, as well as obtaining the IRD number and GST registration. Or clients can form companies themselves on www.companies.govt.nz but please call us first as there are a couple of trick questions.