The Accounting Hub Limited

Grants and subsidies are vital for not-for-profits to fund their initiatives, but navigating the tax implications can be tricky. Did you know that while registered charities are often exempt from income tax on most types of income, they may still have GST obligations? The income tax treatment of grants depends on various factors, including the grant's purpose, its source, and your organisation's tax status. We break down the rules so you can confidently manage your NFP’s finances and avoid any unexpected tax issues: https://bit.ly/3BUwaZq

|| New tax bill || The recently introduced Taxation (Annual Rates for 2024-25, Emergency Response, and Remedial Measures) Bill brings several significant updates to the tax landscape, which could impact both individuals and businesses. Key changes include: 🔹 The ability to backdate the Approved Issuer Levy (AIL) registration, potentially benefiting those with overseas loans. 🔹 New reporting requirements for cryptocurrency service providers, strengthening the IRD’s ability to audit and ensure compliance. 🔹 A streamlined process for tax relief during emergencies, allowing for quicker responses when necessary. 🔹 Changes to KiwiSaver enrolment, creating easier access for under-16s. 🔹 Improved processes for transferring UK pension funds to New Zealand. We will be exploring these changes in more detail as more information comes to hand. In the meantime, you can read our latest blog for further insights. https://bit.ly/3YfDWpq

Not-for-profits: a guide to the new Tier 3 Standard The Tier 3 (NFP) Standard governs the reporting requirements for smaller NFPs with annual expenses between $140K and $2M. The new Standard aims to simplify the reporting process, ensuring that performance reports are both accurate and relevant, while also meeting stakeholder expectations. Key updates include changes to: ✅ Service performance reporting ✅ Asset valuation ✅ Revenue recognition ✅ Categories of revenue and expenses ✅ Transparency over reserves For more detailed guidance or assistance in applying these changes, get in touch with our team of experts who are well-versed in the nuances of NFP financial reporting, or read more here: https://bit.ly/4dcHjlm

|| Professional service providers: understanding cash vs accrual methods for income tax || Many professionals wonder if they can account for income on a cash basis, as opposed to an accrual basis which recognises income when it is invoiced. Using the cash method can delay tax payments and provide a more favourable tax position. While earlier guidance allowed certain professionals to use the cash method, current IRD rules indicate that the appropriate method depends on the specific nature of the business. This is especially relevant for medical practitioners, barristers sole, and company directors, who may still qualify for cash accounting under specific conditions. Larger practices, however, are more likely to be required to use the accrual method. Not sure which method applies to your practice? Contact us for advice on the best tax strategy for your business, or learn more here: https://bit.ly/3Xu69aE

Law webinar: getting ready to practise on your own 4.00-6.15pm, Tuesday 10 September 2024 Starting your journey as a sole practitioner or barrister requires determination, energy, resilience, and substantial preparation. There are numerous aspects to evaluate, choices to consider, and decisions to make. So, where do you start? In this session - presented by The Law Association - an experienced panel will address a range of key issues, including accounting, infrastructure support, marketing, technology, mental health, and managing an exit strategy. They will also provide valuable resources to help ensure a smooth journey. Our very own Andrew Millington is presenting on understanding accounting: business structure, trust accounts, practice management systems, payroll, tax, cash flow. Who should attend? Anyone setting out, or looking, to practise on their own account or already doing so and needing some further guidance. More information & registration: https://bit.ly/3z5R9HB

Starting your own business as a lawyer or legal professional can feel like a leap into the unknown, especially in tough economic times. But these challenges can also be a catalyst for new opportunities and personal growth. For many, redundancy or a lack of prospects in the traditional job market have sparked the decision to "fly solo" – whether as a freelancer, sole trader, consultant, or partner in a new firm. This move offers not just control over your professional life, but also the chance for greater flexibility and long-term financial rewards. Read our checklist for success: https://bit.ly/4duTn29 #smallbiztips #legalstartup #startup

|| New Xero business plans coming this September || Xero is launching simplified business plans to better meet your future needs. From 12 September, you can choose from three new plans and an enhanced Ultimate plan. 🎇Ignite Plan: Ideal for self-employed individuals and startups, offering essential accounting tools. 🪴Grow Plan: Perfect for self-employed and growing businesses, featuring automated accounting, payroll, and expense tracking for one person per month. 🌟Comprehensive Plan: Designed for businesses with employees, providing accounting and payroll to support informed decisions. 🚀Ultimate Plan: Includes advanced accounting, payroll, and forecasting tools, suitable for growing businesses and those planning for future expansion. Add-ons will now be integrated into these plans, eliminating separate purchases. For more details got to https://bit.ly/4bh42f5 or contact us to find the best plan for your business.

|| GST Compliance for Airbnb Hosts: Your Questions Answered || Dealing with GST compliance can be tricky for short-term accommodation providers, especially with recent legislative changes. As of 1 April 2024, the “app tax” mandates that GST be collected on all services offered through electronic marketplaces, such as Airbnb, regardless of the service providers’ registration status. This significant change has raised numerous questions, both specific to the “app tax” and general enquiries about the GST registration threshold. In our latest blog, we address some questions including: ❓Should I (or do I need to) register for GST? ❓Should I decrease my nightly rate to remain competitive? ❓Do I pay tax on the 8.5% flat-rate credit? ❓My Airbnb is already registered for GST and I am already collecting and remitting GST, can I keep doing this? Check out our blog for detailed answers and ensure you're compliant: https://bit.ly/3WGE8gJ

Bright-line test changes You may be aware that, starting 1 July 2024, the bright-line test period is changing from 10 years to 2 years. This means financial gains made from the sale of residential property within 2 years (rather than 10 years) of purchase will be subject to tax. While this may benefit property investors wanting to sell, there are a few nuances to be aware of. For example: 👉 The two-year timeframe runs from the **settlement date** of the original purchase to the **date of the new sale and purchase agreement** 👉 The criteria for the main home exemption have been adjusted. We recommend seeking specialist advice to navigate these changes. Please get in touch to discuss your situation. #NZProperty #BrightLineTest #PropertyInvestment #TaxUpdate

|| Mixed use residential rental properties || Mixed used properties serve both private and income-earning purposes and are unused for 62 days or more each year. For example, consider a holiday home you rent out on Airbnb part of the year, is vacant some of the time, and use personally for the rest. Understanding mixed-use asset classification is important for tax purposes. Specific rules determine how you can calculate deductible expenses, ensuring you only deduct costs related to the income-generating portion of the property. Read more here: https://bit.ly/4enhlgy #propertyinvestment #taxtips #airbnbhosting