Thursday, 21 November 2019

Every undeclared cash job leaves a trail

The IRD is looking hard at tax crime in the construction industry.

They will be contacting tradies to encourage them to declare all of their income through their GST and income tax returns.

While most people in the construction industry are doing the right thing, they are reminding your clients that undeclared cash jobs can have negative consequences. These can result in tax penalties, a criminal conviction that could affect their ability to contract for work, and even prison time.

As a tax agent, we play an important role in helping our clients meet their obligations.

If you have left some income off your previous returns, it’s best to let the IRD know now rather than wait for them to find out another way.


Friday, 16 March 2018

Reference checking new employees

Reference checking tips to get the best information about an applicant so you can be confident you’re making a good decision.

Reference checking is often the last step in the hiring process – when you’re pretty sure who you want to hire, but before you’ve made an offer. Talking to the right people and asking the right questions can help confirm you’re making the right hiring decision.

Always speak to at least one referee before hiring someone, and ideally two.

As well as confirming your applicant’s work history and skills, they can help you get a better idea of how your applicant works and if they’ll be a good fit for your organisation.

The applicant will usually provide two referees of their choice for you to speak to. If there’s someone else you’d like to talk to, discuss it with the applicant – you need their consent before speaking to anyone about them or you’ll be breaching the Privacy Act.

People often won’t want you to speak to their current employer until they have a confirmed job offer. If they don’t give you a past employer that you want to speak to, ask them why – it might tell you a lot. If you need a reference from a particular person because it’s relevant to the position, you should explain why. If the applicant refuses, you might be justified in not offering them the role, as you don’t have enough information to judge their suitability.

For some roles, as well as speaking to a previous employer, you might want to speak to a former colleague or to someone who used to report to the applicant, to get a wider view of how they work in a team.

Making calls

The applicant should let their referees know to expect a call from you, but you might want to arrange a specific time to talk, so you both have enough time set aside for a useful conversation.

Before you phone the referee, check with anyone else on your team who interviewed the applicant about whether there’s anything else they want to know about the applicant. Use this information to help guide the questions you ask.

To get the best information possible from the referee, don’t be too formal. Approach it like you’re having a casual conversation, not conducting a formal interview. Try to establish a rapport before you start asking questions – tell them what you like about the applicant, and give an overview of the role and responsibilities you’re considering them for. Have some prepared questions that you want to ask, but don’t be afraid to let the conversation stray outside of them – this is when you can get some of the best information.

What to ask

Think about what you want to find out about the applicant and tailor your questions around that. Your questions should be open-ended, so you get more than just yes or no answers, but specific enough to get the details you want, eg, ‘What are Lisa’s time management skills like’, not ‘Tell me all about Lisa’. Ask for examples of a time when the applicant did something you want to know about.

The types of things you want to cover off might include:

  • confirming when the applicant worked for or with the referee and what their role was
  • what their skill level is
  • how they work as part of a team
  • whether they have any areas that need development
  • how to best manage them.

Example questions

  • Confirm that the applicant’s employment dates, job title and responsibilities match what was in their CV or discussed at the interview.
  • What were their biggest achievements at work?
  • What are they really good at?
  • What are their areas for improvement?
  • What were their relationships like within the team/with people reporting to them/with wider stakeholders?
  • What types of stressors existed in their position and how did they handle stress?
  • How much supervision did they need?
  • What management style works best for them?
  • Were there any issues or concerns, like lateness?
  • Would you hire them again? Why?

Selecting and appointing employees - Employment New Zealand 

What not to ask

Stay focused on the skills, experience and competencies required for the job to avoid any issues around privacy and discrimination.

Don’t ask about things like:
  • race or ethnic background
  • age
  • disability
  • sexual orientation
  • family situation.

After you've checked the references

If you’re told something during the reference check that isn’t what you expected, you can go back to the applicant for clarification, but remember that the information disclosed to you by the referee was given to you in confidence.

Just because you check an applicant’s references does not mean you are locked into hiring them, but if you are satisfied with what you hear in the reference check, the next step is to make a job offer.

Sole traders: Got your NZ Business Number?

Get your NZ Business Number

The New Zealand Business Number (NZBN) is a globally unique identifier available to all Kiwi businesses, including sole traders, and it comes with a growing list of benefits.

What's the NZBN?

The New Zealand Business Number (NZBN) is a unique identifier available to every business in New Zealand. It provides an easy way to identify different businesses, and to share and update business information.

New Zealand companies and public sector agencies are automatically given an NZBN. Sole traders, partnerships and trusts can register for one.

Information about each business is listed in a secure online register, managed by the Ministry of Business, Innovation and Employment.

Why get an NZBN

It’s free to get an NZBN. Any business operating in New Zealand can get one – whether you’re a sole trader working from home, or a multi-national organisation. An NZBN:

identifies you as a real NZ business
should save you time by reducing the number of places you need to update your business information when something changes
makes it easy to check details for new suppliers or clients
is a globally recognised number, so when you use it, anyone across the world can recognise you.
As more businesses get and use their NZBN, it will get easier to invoice customers, pay bills and apply for credit. You won’t have to repeat the same basic information multiple times, saving you time and money.

What it means for sole traders

If you’re a sole trader, you can use your NZBN to:

prove that your business is real and valid
easily share and update your business information
speed up your interactions with government agencies such as Inland Revenue, ACC and the Ministry of Business, Innovation and Employment
auto-fill your business information in online forms that require your NZBN.

How to get an NZBN

Some types of businesses, like registered companies, are automatically given an NZBN. Sole traders, partnerships and trusts need to sign up for one separately.

To get an NZBN, you’ll need a RealMe login.
Get a RealMe login

Then you can register for your number on the NZBN website.
Get your NZBN

For questions about the New Zealand Business Number phone  0508 696 926 or email

Thursday, 26 January 2017

If you’re a landlord, you’re in business

If you’re a landlord, you’re in business

Your rental property might be the result of a clever investment plan or something you just fell into. Either way, if you collect rent on a rental home, you’re running a business and there are rules you’ll need to comply with.

What you need to know

Like any small business, if you rent a home, you have customers — your tenants — and contracts and laws you need to understand.
You have to be across the property, the people, the paperwork and the processes. And as with any business, things keep changing, eg:
  • smoke alarms are now compulsory in your rental home and you must fit the right type in the right places
  • all your new tenancy agreements must now include an insulation statement disclosing if there is insulation, where, what type and its condition — you must make all reasonable efforts to provide this information so tenants know what to expect
  • you will need ceiling and underfloor insulation, where reasonably practicable, by July 2019, though some exclusions could apply.
If you don’t comply you could face penalties of up to $4,000.
Healthy homes — Tenancy Services website.

If your tenant has a Community Services Card, you may get a government insulation grant.

Landlords and other homeowners may also be eligible for help from their local council. Some councils will add insulation costs to rates and let you pay it back over several years.
Find out more at EECA’s energywise website.

What happens if you get it wrong

Most landlords and tenants want to do the right thing.
The Tenancy Compliance and Investigations Team investigates serious breaches of basic housing standards, which can lead to enforcement action.
However, the government doesn’t need a tenant’s complaint to do something — it can act on behalf of a tenant in the Tenancy Tribunal and District Court, even without the tenant’s permission.

Tenancy Services

Tenancy Services, a part of the Ministry of Business, Innovation and Employment, holds bond money in trust and has resources and services to help landlords and tenants understand their rights and responsibilities.
If you’re having trouble, Tenancy Services will help resolve the dispute by talking to you about the problem, arranging mediation or referring you to the Tenancy Tribunal.
Tenancy Services can help you with:
  • understanding different tenancy types 
  • making tenancy agreements
  • paying rent, bond and bills 
  • understanding your rights and responsibilities
  • doing maintenance and inspections
  • keeping records
  • giving notice and ending a tenancy.
The Tenancy Services website has agreements, forms and templates to make the paperwork easier. You can pay and lodge bonds online, and lodge complaints and Tenancy Tribunal applications.
Market rent calculator — Tenancy Services
Forms and templates — Tenancy Services
Disputes — Tenancy Services
Landlord News and Market Rent e-newsletters — Tenancy Services

Artcile originally from

Monday, 11 January 2016

How to handle GST on second-hand goods

Buying second-hand goods for your business can help keep costs down because they are usually cheaper than new goods. At this time of year, you might be able to pick up some good bargains from other businesses as they take advantage of summer sales to upgrade their own equipment.

The good news is that if you're GST-registered, you can claim a GST credit on second-hand goods bought in New Zealand for your business – even if the seller isn't registered for GST.

That's really handy if you, for example, buy a second-hand wheelbarrow from your neighbour to use in your gardening business, or pick up a second-hand printer in an online auction to use in your graphic design business.'s Tax and finance section explains all about GST, including how and when to register for GST.

It's pretty obvious that new goods are not considered second-hand when it comes to GST.
But certain other goods also can't be considered second-hand when it comes to GST, including:
  • livestock
  • goods supplied under a lease or rental
  • primary produce
  • goods made with fine metals – platinum, gold or silver.
Otherwise, it's considered second-hand if it's been used and paid for by someone else, and was in New Zealand when you bought it.

It doesn't matter which accounting method you use, you can only claim GST on what you paid for the goods .

As with all things tax-related, it's important to keep good records, even if you pay cash at your uncle's garage sale.

The Inland Revenue website has a full guide to GST, but here is a brief case study to show you how to calculate it.


Fiona bought a second-hand shelving unit to use in her gift shop. She bought it from the white elephant stall at her local school fair and paid $85 for it.

To calculate the GST she used the formula:
Purchase price × 3 ÷ 23 = GST credit that can be claimed
$85 × 3 ÷ 23 = $11.08

You won't get a tax invoice when you buy from someone who isn't registered for GST – just like Fiona didn't get one from the fair – and no GST will be charged. To claim the credit for GST purposes, you'll need to record the following information:
  • the name and address of the person or business you bought it from
  • the date of the purchase
  • a description of the goods
  • the quantity of the goods
  • the price paid.
If you buy from a person or business that you have an association with, the GST credit is calculated differently. Check Inland Revenue's guide to find out more about associated persons
You'll also need to keep details of the transaction if you're going to make a claim for income tax purposes.

Original Article