We are thrilled to announce the official opening of our Queenstown branch, extending our services to our valued clients and prospective partners in the Otago region. This expansion is a testament to our commitment to being readily accessible to meet your needs.
Visit us at our new office location: Level 3, Craigs Investment Building Mountain Club, 36 Grant Road, Five Mile Centre, Queenstown 9300.
Our dedicated team is eager to welcome you and address any inquiries or concerns you may have. Feel free to drop by, and we look forward to serving you at our Queenstown branch!

As the festive season is fast approaching, we would like to inform you of our Christmas shutdown period. The office will be closed from 22 December 2023 to 9 January 2024, and we will resume operations on 10 January 2024. During this holiday period, for any urgent inquiries, please feel free to reach out to Cristina Canard at [email protected] or on her mobile at 022 076 7577.

We take this opportunity to extend warm holiday wishes to each member of our Apex Family. Your continued partnership is deeply appreciated, and we look forward to another prosperous year together. Wishing you joy, peace, and success during this holiday season!
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Best regards, Apex Accounting Team

Our December newsletter is bursting with lots more information. Please feel free to read the whole newsletter via the button link. 

It is a prime time to fine-tune your tax strategy. Consider the following practical tips to optimize your tax position:

1. Review Deductible Expenses:
   Take a close look at your business and personal expenses. Identify deductible items such as business-related expenses, home office costs, and education expenses. Ensuring you've accounted for all eligible deductions can significantly impact your tax liability.
2. Maximize Retirement Contributions:
   Contributing to retirement accounts is not just a smart financial move for the future; it can also offer immediate tax benefits. Ensure you've maximized contributions to your KiwiSaver or other retirement savings plans to take advantage of available tax incentives.
3. Explore Tax Credits:
   Investigate available tax credits that align with your circumstances. This may include personal tax credits, childcare credits, or credits for charitable contributions. Every eligible credit can contribute to reducing your overall tax burden.
4. Strategize Capital Gains and Losses:
   If you have investments, consider the tax implications of selling assets. Strategically balancing capital gains and losses can help minimize your taxable income. Review your investment portfolio and consult with us to make informed decisions.

Remember, these are general tips, and it is always advisable to consult with us or a tax professional to ensure your unique situation is considered.

Tax Credits and Incentives

Did you know that there are existing tax credits and incentives? These are available for individuals or a company, so understanding these opportunities can make a real difference.

Individual – Tax Credits and Incentives

1. Credits for taxes withheld or paid

• PAYE tax deducted by employers from employee wages;
• Provisional tax instalments paid by business owners;
• Resident withholding tax (RWT) deductions on interest and dividends to tax residents;
• Withholding tax deducted from payments made to contractors.

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2. Imputation Credits:
The imputation system is designed to prevent double taxation on company profits. Here's how it works: a company attaches imputation credits (reflecting tax paid at the company level) to cash and non-cash dividends, as well as taxable bonus issues, distributed to shareholders. Shareholders then use these imputation credits to lower their own tax liability on the company’s dividends. Shareholders consider both the dividends and imputation credits as assessable income, with a credit allowed against their income tax liability matching the attached imputation credits. However, non-resident shareholders cannot utilize imputation credits.

3. Personal Tax Credits:
Individuals earning between NZD 24,000 and NZD 48,000 annually and meeting specific criteria qualify for an 'independent earner' tax credit of NZD 520. If the income surpasses NZD 44,000, the yearly entitlement diminishes by 13 cents for every additional dollar earned until reaching NZD 48,000, where the credit is entirely phased out.

4. Charitable Donations:
The credit for charitable donations allows individuals to claim a 33.3% tax credit on eligible contributions, capped at their taxable income.

5. Working for Families Tax Credit (WFTC):
The 'Working for Families' tax credit is available to individuals, offering an in-work payment for families with dependent children. Geared towards low and middle-income families, these credits are typically disbursed in fortnightly instalments, with an annual reconciliation for any under or overpayment. The amounts received are non-taxable. Family scheme income, defined as the net income, forms the basis for entitlement and tax credit calculations under the family scheme.

Corporate – Tax Credits and Incentives

1. Foreign Tax Credits:
When a New Zealand resident company earns income abroad that falls under New Zealand income tax, the company is typically eligible for a credit corresponding to the foreign income tax paid on that revenue. Foreign tax credits are applicable only when the taxpayer is in a tax-paying position. Failure to claim foreign tax credits in the current year results in their forfeiture.

2. Inbound Investment Incentives:
New Zealand offers targeted tax incentives to promote the influx of investment funds into the country. Legislation actively supports foreign venture capital investment in unlisted New Zealand companies. Profits gained by specific non-residents from selling shares in New Zealand unlisted companies, provided these companies do not engage in certain prohibited activities as their primary focus, are exempt from income tax. These rules are applicable to foreign investors residing in all countries with which New Zealand has a Double Tax Agreement (except Switzerland) and who invest in New Zealand venture capital opportunities.

3. Trans-Tasman Imputation:
Elective rules enable groups of companies spanning both New Zealand and Australia (trans-Tasman groups) to affix imputation credits (reflecting New Zealand tax paid) and franking credits (reflecting Australian tax paid) to dividends distributed to shareholders. This system permits fully owned groups of Australian and/or New Zealand companies to amalgamate solely for imputation purposes. Such groups, comprising members from both Australia and New Zealand, are referred to as trans-Tasman imputation groups (TTIGs). New Zealand companies within a trans-Tasman group maintain a distinct 'resident imputation subgroup' account.

4. Research and Development (R&D) Tax Incentive:
Eligible research and development (R&D) expenditures can trigger a 15% tax credit. Core R&D activities qualifying for a tax credit involve conducting activities systematically, with the primary goal of generating new knowledge or enhancing processes, services, or goods, and to resolve scientific or technological uncertainties. The eligible R&D expenditure encompasses specific categories such as salary and wage costs, overhead costs, asset depreciation, and direct expenditure on consumables and materials. Certain activities and costs, however, may be excluded from the tax incentive. This incentive is accessible to taxpayers with R&D expenditure falling within a set range, ranging from a minimum of NZD 50,000 to a maximum of NZD 120 million annually, unless special approval is obtained to exceed the cap. The rules also provide limited cash refundability for certain entities facing losses.

(Source: New Zealand - Individual - Other tax credits and incentives (pwc.com); New Zealand - Corporate - Tax credits and incentives (pwc.com))

We have written a lot more about Tax Optimisation Tips in our December newsletter. Click the button to download the full newsletter.