You can’t avoid tax time — but you can prepare for it. Follow these tips to make it easier for your business.
Throughout the year keep receipts, as well as invoices you’ve received and copies of invoices you’ve sent out. Keep them tidy and in order. It helps to record on each receipt the reason for it, eg why you took that taxi or who you bought lunch for back in November. Read more about keeping records.
Know which ones apply to you and your business. Do you provide perks to your people? Was your turnover for the last year more than $60,000? Want to pay your income tax in instalments? Then read our Tax & accounting section for basic tax types, and much more.
Inland Revenue has a calendar of all the filing dates for 2015/2016. It shows the return and payment due dates for income tax and provisional tax, fringe benefit tax, GST and PAYE, based on a standard balance date of 31 March. You can also find the due dates just for your business(external link).
You should put aside money for tax each time you receive income. This means your tax bill won’t come as a complete shock. If you put it in a high-interest savings account, then the interest earned could cover your ACC payments. This is really important during your first year of business, so that you’ve got the money to pay your first year of tax in your second year, as well as paying provisional tax. Inland Revenue’s guide to provisional tax (IR289)(external link) explains this in more detail.
Not all tax is complicated, and you may be able to handle it yourself. But if your tax requirements are complex, then consider asking an expert for help. They will cost you money, but as they know all the ins and outs of tax, they may end up saving you more than they cost you. See tips on how to legally reduce your bill.