PLANNING AND FORECASTING
Financial Planning - A Few Tips
Some planning is essential for your business, i.e.
- what sales will you make?
- what goods, products or services are you selling and are you going to add to them?
- how will your competitors react and how to do you stay ahead of them?Planning for a 'rainy day' can be more difficult. However if you accept that occasionally life will throw the odd curve ball at you, you can give it some planning and consideration beforehand. Then, if the worst happens, you will know how to deal with it. For example, bank interest rates, could fall into this category. You have no control over them but you could calculate how interest rates at varying percentages could impact your business. You could discuss with the bank their predictions on interest rises and see if the bank offers a benchmarking service to see how your business is tracking against the rest of the market.
And don't forget we, at Davis and Co, are always happy to offer coaching/planning meetings to help you keep your business ideas on track.
Reducing your tax bill
1. File returns and pay on time - this will save you having to pay late filing penalties. (Remember that if you haven't provided Davis and Co with the relevant information already, we need this ASAP).
2. Keep all your receipts and invoices and pay for business expenses from your business account. You pay tax on your total profit, less allowable expenses. Being able to provide proof of these expenses is essential. You can check what expenses you can claim by visiting www.business.govt.nz/tax-and-accounting/reducing-your-tax/claiming-expenses.
3. Keep a log book if you are running a private vehicle for business use - show distance travelled, dates and reasons for journey. This can be used to reduce your tax bill.
4. Claim for depreciation on assets bought for your business - again keep receipts/invoices.
Stay aware of changing legislation
Minimum Wage Rates - From 1st April 2019 the minimum adult wage will increase to $17.70 per hour (currently $16.50 per hour).
Payday Filing - From 1st April 2019 it will be compulsory to file payroll information every payday, rather than once a month. Ask us for more info.
Anti-money laundering and countering financing of terrorism - it is now a requirement for us, Davis and Co, to keep on our records a copy of either your driving licence or passport (including photo ID). We will be asking for this information from you, if not already obtained, in the very near future.
Loss offsetting on residential rentals is changing - we will be sending further information on this in a newsletter dedicated to this shortly.
Making Xero your hero
For those clients with Xero Payroll, Xero are implementing changes in order to comply with Payday Filing. Users will be able to report directly to IRD payroll information each time staff are paid.
Xero have also improved the help that is available. If users click on the question mark in the top banner, they will be taken to Xero Central where they can seek answers to their query/question.
Davis and Co will be running Xero Workshops in February to help increase our clients skills and understanding when working with Xero. Keep an eye on out for your invitation to join us.
THANK YOU to all of you who took part in our recent survey with regards to seminar/workshop timings. In future we will aim to deliver two sessions for each event, one first thing in the day and one early evening.