Tax and Compliance
Business Taxation and Compliance SErvices
COmpleting your financial accounts and tax returns
We prepare financial statements and tax returns for many types of small to medium businesses.
Everything required in line with tax structures, to minimise overall tax in a ‘group arrangement’ so also complete family-related personal returns for Company Directors, Trusts, spouses and children.
We are proudly leading tax specialists in residential property investment. We provide expert advice based on our wealth of practical everyday experiences. Our aim is simple. To complete all compliance requirements on your behalf, so it is as stress-free as possible for you.
WHo are our clients?
• A significant number of property investors, ranging from waged and salaried employees with one or two rental properties to larger property clients including developers and large dealers in property in New Zealand and Australia. We account for over $500million of property investments in Australasia.
• Small to medium sized businesses, with the majority of our clients with turnovers between $50,000 and $10m reflecting a typical distribution of Kiwi run businesses.
What industries & sectors do we have experience?
We serve clients in 18 different industries and are of course already experienced in specific industry related tax matters.
Whilst we specialise in residential property investments. our expertise extends to serving a broad and diverse range of SME clients.
Examples of clients represented in sectors include;
• Superannuation Funds
• Mortgage Brokers
• Veterinary Services
• Engineering Design and Consulting
• Health and Fitness Operators and Personal Trainers
• Automotive Electrical and Body Paint and Repair
• Hairdressing and Beauty Services
• Road Transport Operators and Couriers
• Technology and Consulting
• Printing Support Services
Everything property is represented in our client base!
You name it in property, we manage all taxation and accounting needs exampled by;
• Small Investors
• Large Investors
• Property Traders
• Kiwis investing in Australia
• Land Development and Subdivision
• House Construction
• All types of ‘Tradies’ e.g. plumbing, electrical, painting and decorating, plastering
• Real Estate Agents
• Architects and Draftsman
• Accommodation and Short Term Rental let by Online Travel Agents e.g. AirBnB and Booking.com
• Rental Property Managers
Whilst our office is in Auckland our client base is geographically spread. Skype or phone meetings allow us to serve clients right across New Zealand and Australia.
We are proud to be able to call ourselves the Market Leader in property tax and accounting in Australasia.
XERO ACCOUNTING SOLUTION AND TRAINING
Since 2013 we have run our practice on Xero. Our entire practice team are Xero Certified Advisors. This means we are formally recognised as having the strongest understanding and practical knowledge of how to use Xero with clients.
What's important about Xero is it makes things simpler and easier for you to manage and stay on top of your business. There are many Xero client benefits, our top three are;
1. Cash is king for SMEs. Xero is renown for invoicing and getting paid more easily. The handy smartphone app has the ability to raise invoices and record purchases (including taking photos of receipts) on the go. Often its much easier to do things in the moment.
2. Better Communication. With all your records in one place, our practice team and clients can discuss financials from the same common view. This allows us to highlight issues and solve queries much faster.
3. Up-to-date information. Digital automatic bank and credit card feeds means you get up to date business information as often as you need. Those late night Excel ‘binge’ bookkeeping sessions and trying to remember months of transactions are a thing of the past.
Do you Offer XERO Training?
Yes. Xero offers comprehensive online training if you have the time or interest in accounting. We offer tailored Xero set up and get you going more quickly, with training at our premises or yours.
We find the majority of SMEs clients are 'time poor' and prefer us to complete tax financials. However, the choice is entirely yours. You decide how much bookkeeping or accounting is right for your circumstances and we will work with you to get the tax compliance job done.
To find out more about Xero and a 30-day free trial or to discuss training needs contact Martin Davidson on 09 294 6262 or email email@example.com.
For useful tips and tricks click here to be taken to our Client Resources section.
CAN YOU HELP WITH OTHER ACCOUNTING PACKAGES?
Yes. We can meet all your financial year-end tax compliance needs if you currently use MYOB, SAGE, Solution Six and Banklink. We have practice team members experienced in these packages.
Can you advise RELEVANT XERO ADD ON Apps that WOULD work IN MY BUSINESS?
Yes of course! We are using a number of Add On Apps to efficiently run our own Practice and have already helped a number of Clients across a broad range of industries.
We have noted the following trends in our Client base.
1. App Area - Our Clients are adopting Apps to improve reporting, business intelligence and job management.
2. The Top Marketplace Apps connected to Xero over the last 12 months ;
Deputy (Staff Rosters & Workforce Management), DEAR Inventory, Kounta (Retail - Point of Sale), WorkflowMax (Project Management), Spotlight Reporting, Microsoft PowerBI (Business Intelligence) and Hubspot or Suitefiles (Customer Relationship Management and Marketing Automation).
To learn more about App trends in your industry sector and if your business could benefit from the Xero platform upgraded with App automation contact Martin Thomas firstname.lastname@example.org or 09 294 6262
Tax Pooling Service To Help You Avoid IRD PenaLTIES
Martin Davidson & Associates strategy is to offer our clients the widest choice of business & trust-related services which are financial and risk-mitigating in nature. We do this by partnering with entities who are market leaders and enjoy a solid reputation for product and service excellence. To this end Martin Davidson & Associates have formed a strategic partnership with TMNZ to help our clients save time and money with smart tax management and achieve a Together Better Trusted Partnership™.
By way of introduction, TMNZ are a tax intermediary who passes through your income tax funds on to the Inland Revenue at a lower interest rate than what the Inland Revenue would charge if taxes were overdue. They are New Zealand’s leading Inland Revenue tax pooling provider and has been operating in New Zealand since legalisation came into effect in 2003.
How can TMNZ help me?
They are a tax pooling service which means allowing you the flexibility to pay your income tax at a time or in a manner that suits you and your business cashflows. This is done without having to incur late payment penalties and providing the funds at a lower interest rate than what the IRD would usually charge at 8.22% saving you up to 30% on interest costs for any missed tax payments.
Instead of paying IRD directly on set provisional tax dates, you send your payments to TMNZ’s tax pooling account at what frequency you can and they will transfer the tax to IRD at the backdates as if you had paid the tax on time. The arrangement with TMNZ will be recalculated for updated interest at the end of each month on the remaining core tax balance owing (so if you are paying it off faster the interest cost will decrease, or if you are paying it off slower it will increase).
TMNZ send payment reminders every month with an updated statement showing the core tax remaining with the updated interest calculation, so you are able to see how much has been paid and what is owing each month.
They are also able to purchase any tax types at back dates in case of an IRD notice of assessment and reduce the interest costs and potential penalties that are charged (PAYE, FBT, GST, NRWT & INC).
By using this IRD approved service by TMNZ you will receive an additional 75 days past your terminal tax date to pay any provisional tax owed for that year.
Options of paying tax with TMNZ
Flexitax will suit those who wish to pay provisional tax in installments.
There are no set amounts or payment dates – you pay what you can and when it suits your cashflow, provided you do so within 75 days past your terminal tax date for the tax year the arrangement relates to.
Under Flexitax, Tax Management NZ’s interest is recalculated on the core tax owing each month.
Tax Finance lets you defer the full provisional tax payment to a time in the future that better suits your business.
You pay a fixed, upfront finance fee and choose the date when you would like to pay.
The finance fee is based on the amount of tax due and how long you are deferring your payment.
Frequently asked questions?
How can I pay the missed or underpaid provisional tax I owe IRD with Tax Management NZ?
One-off payment: You pay the tax you owe and Tax Management NZ’s interest in a lump sum.
Installments: There are no set amounts or payment dates. You chip away at the amount owed over a longer period, paying what you can and when it suits your cashflow. Tax Management NZ’s interest is recalculated on the core tax owing each month.
A future date: You choose a time that suits you to pay and pay Tax Management NZ’s fixed interest cost upfront. You then pay the tax owed at the agreed-upon future date.
Are there any conditions?
Yes, Tax Management NZ can help with missed or underpaid income tax payments for the current tax year or one just completed, provided you are within the legal deadline.
How long does it take for my payments made to Tax Management NZ to show up in my IRD account once they have been transferred?
Normally payments made to Tax Management NZ will show in your IRD account within three weeks after being transferred from the tax pool.
However, please note this may take longer during the March-June window due to the larger-than-normal volume of transactions that are processed during this time.
How long do I have to pay Tax Management NZ if I receive a notice of reassessment from IRD?
You have 60 days from the date the IRD notice of reassessment was issued to pay the additional tax owed through Tax Management NZ.
Can I access any payments held in the TMNZ tax pool if required?
Absolutely. Any payments made into the TMNZ tax pool can be refunded, transferred to your IRD account, sold or used as collateral to draw down short-term funds.
If you like further information on tax management & pooling please contact our inhouse expert Elyse Muirson toll-free anywhere in New Zealand on 0508 T AGENT (824 368) or 09 294 6262. or email email@example.com
IRD RISK MANAGEMENT
Disputes and Issues with IRD
The IRD is increasing the numbers of staff allocated to taxpayer audit. Trade in residential property is a new priority for the IRD resulting in a doubling of resources reviewing property compliance. There are now 95+ staff focusing on risks in the residential property market to make sure customers meet their obligations in relation to returning any applicable tax on property gains
IRD Taxpayer auditors tend to get a mixed review. Consistent points of criticism from Tax Practitioners;
-Ineffective or no communication especially on grey area technical issues. Often the IRD goes incommunicado. with weeks and months passing as back offices processes solicit opinion/rulings from several internal functions.
-Inexperienced staff are expected to do audits beyond their capability and instances of new staff are not adequately supervised.
-Length of time of investigations to 'close' investigation.
The above coupled with an increasingly aggressive IRD and Australian Tax Office (ATO) approach and more sophisticated technology represents a real business risk to you.
WHO CAN BE SELECTED FOR AN audit?
Audits, reviews and investigations are conducted by the IRD to ensure business and taxpayer compliance with numerous tax and legislative requirements. To see the IRD full list of how they select to audit click here.
Anyone can be targetted, even if returns are accurate and compliant. To mitigate this risk we have partnered with Audit Shield.
Audit SHIELD RISK MITIGATIOn
After an extensive review of insurance services we have chosen Audit Shield as part of our Together Better Trusted Partnership™ strategy. It is a piece of mind product whereby your business is 100% covered against professional fees incurred in the event of that you are selected for an audit, enquiry or investigation. For a modest premium Audit Shield takes the worry, pressure, and anxiety out of the process of tax compliance.
What are the costs to businesses and taxpayers in the event of a random audit, review or investigation?
If your business or individual return is subjected to a random audit, review or investigation, you are responsible for the costs (professional fees) involved in providing the required information. Even the simplest enquiry can require hours of work. In multiple years or multiple companies and trusts, thousands of dollars in accounting and legal fees can be incurred.
The cost of being properly represented in these matters can be quite considerable depending on the length of time involved.
How can I protect myself from the costs of random audits, reviews and investigations?
We can offer you participation in our Audit Shield Master Policy which can provide you with comprehensive relief from these costs (fees). The Audit Shield Master Policy provides for the payment of the professional fees incurred as a result of you being selected for an audit, review or investigation by the IRD.
The Audit Shield Master Policy premium provides a fixed, cost effective solution guarding against unbudgeted costs and are tax deductible. Our Audit Shield Master Policy is underwritten by Vero Liability Insurance Limited.
What Costs are covered?
The service covers all professional fees up to a prescribed limit (with no excess) when responding to, or representing you in an audit, review or investigation. These include not only our fees but also legal fees, bookkeeping fees and specialist professional advisor fees (e.g. specialist accountants, lawyers etc).
Who is covered?
All of our clients can take advantage of our Audit Shield Master Policy. In fact, a large number of our existing clients have already taken the protection of audit shield provides.
Even as a new client to Martin Davidson and Associates Audit Shield is retrospective. So all previously lodged returns are also included in the coverage. Very handy if you lack confidence in your current accountant or tax agent.
Different levels of cover are available for salary and wage earners and businesses or business groups. As mentioned above we feel the premiums are very cost effective relative to potential exposure of professional fees incurred during an IRD audit.
What do I need to do to participate in the Audit Shield Master Policy?
To find out more or get cover please contact Debbie Francis on 09 294 6262 or email firstname.lastname@example.org and we will send you an information pack.