| August 2011 |
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| Download the 2011 year end questionnaires |  |
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Hi everyone, welcome to our “late winter” edition of WT newsletter.
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| Topics covered in this issue: | ||
| WT on Property... | ||
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Inland Revenue Special Projects – Short Term Rental Coinciding with the Rugby World Cup and in line with IRD continued focus on property compliance, IRD has commenced a special project targeting Short Term Rental. Using publicly available information like short term & holiday rental websites, advertisements and other databases, IRD has identified and selected taxpayers for this special project. IRD will be contacting the selected taxpayers by phone, webmail, email and letters over the coming weeks to ensure they are aware of the tax obligation to declare any rental income and are correctly claiming any related expenses in the 2012 income year. Though IRD advises that this is NOT an audit or tax investigation exercise, it is a timely reminder for you to contact one of our senior accountants if you have any concerns or questions how this could affect you. Similarly, we can assist you if IRD has approached you already.
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Loss Attributing Qualifying Companies (LAQC) election Deadline Since October last year, our firm has taken a proactive approach to educate and remind our clients through newsletter, audio CD and seminars about this very important issue. Deadline is looming. If you have a Loss Attributing Qualifying Company (LAQC), then you have a decision to make by 30 September 2011….next month! If you don’t make any decision or election, your company will automatically default to a Qualifying Company status. This means any losses incurred for 2011/2012 income year will be “trapped” in the company. It will NOT flow through to you like prior years. If you want access to your losses personally, then your company has to elect and transition into the new Look Through Company regime or restructure into a sole trader/partnership structure. Many clients have decided already. Our senior accountants are busy following up with the “undecided” ones. If you have not reached a decision, please contact us immediately…time is running out.
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| WT on Tax... | ||
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2012 Provisional Tax We have already sent out all the provisional tax reminders to our usual provisional taxpaying clients. If you have not received yours but are expecting to pay provisional tax, please contact us as soon as possible. If your income level for the current year has changed, please contact us so that we can recalculate and amend the amount payable.
GST
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Inland Revenue Special Projects – Overseas Income Matching As well as giving IRD additional funding resources ($120 million in the May Budget), the government has secured Information Sharing Agreement with many more overseas jurisdiction (e.g. Cook Islands) in order to share income information across the borders. Along with Double Tax Agreements, internet and many other electronic medium, it has become much easier for IRD to investigate any overseas transaction. Accordingly, IRD continues their compliance focus on overseas income which has not been declared in New Zealand. If you derive income overseas (e.g. interest, rent), overseas authorities would usually require you to file a tax return despite you not physically living there. As a New Zealand tax resident, you have the obligation to disclose any income or maybe losses derived overseas in your NZ tax return as New Zealand taxes worldwide income. This is why in our Year End Clients Questionnaires we have an entire section designated on Overseas Income and Investments disclosure. If you have any concerns or unsure of your obligations, please contact one of the directors or senior accountants. If necessary, we can assist you to prepare voluntary disclosure to IRD before they approach you.
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Copyright ©2011 Withers Tsang & Co Ltd. All Rights Reserved. This email was sent to you at the following address: [email address suppressed] |
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