Tax relief for businesses hit by severe July weather
The Government has made an Order in Council declaring the series of adverse weather fronts that crossed New Zealand between 11 July and 31 July 2022 to be an emergency event and allows Inland Revenue to waive interest charges on late payments of tax for business affected by that emergency event. The Tax Administration (July Adverse Weather Event) Order 2022 allows Inland Revenue to waive use of money interest for late payment of taxes.
The emergency event applies to people whose businesses in the districts of Canterbury, Gisborne, Northland, Otago, and Wairoa have been affected by floods, damaging high winds, and disruption to infrastructure.
The Order is now in effect and will expire on 30 September 2022.
Businesses affected by the floods are urged to contact their tax agent if they would like to take advantage of the interest remission measure. Taxpayers will be able to apply to have late payment interest waived once they have filed their returns and paid due taxes.
Different rules apply in cases of financial hardship.
Provisional Tax DUE SOON
Provisional tax is due on August 28, 2022.
Provisional tax helps you manage your income tax. You pay it in instalments during the year instead of a lump sum at the end of the year. You'll have to pay provisional tax if you had to pay more than $5,000 tax at the end of the year from your last return.
It's payable the following year after your tax return. For example, if your residual income tax from your 2022 return is more than $5,000, then you'll need to pay provisional tax during the 2023 tax year.
Provisional taxpayers often earn:
There are some situations where you may need to pay provisional tax on your reportable income.
Reportable income is income information that Inland Revenue receives regularly from a third party (e.g. an employer, a bank, etc) for an individual and a tax year.
These can be due to:
Please budget for your August 28, 2022 Provisional tax.
Calculating YOUR Charge out rate
In order to calculate an accurate charge out rate there are many factors you need to take into account. From your target income to the amount of hours you can manage ANZ has all the tips and tricks.
INFLATION RATE - NOW 7.3%
The consumers price index (CPI) is a measure of inflation for New Zealand households. It records changes in the price of goods and services. It influences interest rates and is used to calculate changes to benefit payments.
Calculating the breakeven point is a key financial analysis tool used by business owners.
Once you know the fixed and variable costs for the product your business produces or a good approximation of them, you can use that information to calculate your company's breakeven point. Small business owners can use the calculation to determine how many product units they need to sell at a given price point to break even.
The Breakeven Point
A company's breakeven point is the point at which its sales exactly cover its expenses. To compute a company's breakeven point in sales volume, you need to know the values of three variables:
How to Calculate Breakeven Point
In order to calculate your company's breakeven point, use the following formula:
Fixed Costs ÷ (Price - Variable Costs) = Breakeven Point in Units
In other words, the breakeven point is equal to the total fixed costs divided by the difference between the unit price and variable costs. Note that in this formula, fixed costs are stated as a total of all overhead for the firm, whereas Price and Variable Costs are stated as per unit costs—the price for each product unit sold.
The denominator of the equation, price minus variable costs, is called the contribution margin. After unit variable costs are deducted from the price, whatever is left—the contribution margin—is available to pay the company's fixed costs.