Whangarei Accountant Blog, News and Resources, Russell Turner Chartered Accountants, Whangarei, Northland, New Zealand

Minimum wage rise and Kiwisaver contribution changes from 1 April 2026

Mon, 09 Mar 2026 20:36:30 GMT

Adult minimum wage rises to $23.95 an hour

This is an increase of 45 cents per hour from the current hourly rate of $23.50. The training and starting-out minimum wages will also both increase to $19.16 per hour, remaining at 80% of the adult minimum wage. This is a rise from the current minimum rate of $18.80 per hour.

An employee working 40 hours per week on the adult minimum wage will earn an extra $18 per week or $936 per annum (before tax) compared to the current minimum wage. Around 122,500 New Zealand workers currently earning below the new minimum wage rates should get an increase in their pay packets as a result of the change in the minimum wage.

KiwiSaver contribution rate changes

The default KiwiSaver employer and employee contribution rate will rise to 3.5% (from 3%). The new rate will affect all pay days from 1 April. So even if your pay period covers before and after 1 April, your whole contribution for that pay period will be deducted at the new rate.

Temporary rate reduction

If you are an employee, you can apply for a temporary rate reduction from 1 February 2026 if you want to carry on contributing at 3% from 1 April 2026. This could be because you can’t afford the rate increase or want to save in other ways. You can apply for a rate reduction for a 3 month (92 days) to 12 month period. You can do this as many times as you like. Your employer can choose to match your temporary rate reduction. Once you move from the temporary rate to a higher rate, IRD will notify your employer.

Contributions for 16 and 17-year-olds

Those aged 16 or 17 will qualify for employer KiwiSaver contributions from 1 April 2026, so long as they meet other eligibility requirements. If the employee contributes to KiwiSaver from their wages, the employer will need to start making contributions. Before 1 April 2026, employers only need to contribute for employees aged 18 to 65.

Xero's automatic bank reconciliation tool

Wed, 04 Feb 2026 22:17:08 GMT

In November 2025 Xero launched a new feature called Auto-Reconciliation . It uses Xero’s internal AI engine to automatically match and reconcile new bank statement lines overnight rather than you doing it manually. It applies your existing bank rules, matches invoices and bills, and learn s from past reconciliations to predict future matches.

Auto-Reconciliation is in open beta and available to selected organisations on Xero’s Growing plan and above. If your business has access to it, you will see it when you are in the Bank Accounts → Reconcile screen. Subscriber or advisor-level permissions are required to turn it on. If you don’t like it, you can turn it off again.

If you already code your own Xero, your transactions are consistent and you already use bank rules effectively, this has good potential to reduce your admin workload. It may be less suitable at least initially for businesses with complex transactions, frequent adjustments or multi-currency dealings.

What should you watch out for?

Only new transactions are auto-reconciled; historical items still need manual handling.
It does it based on confidence levels, so some transactions will still require review.
If you are slow getting bills or invoices into the system, it won’t match them.
Multi-currency transactions may need manual checks for exchange rate adjustments.
You need to review the reconciliation screen and fix mistakes it makes. It learns from your corrections. Fixing is easy - It provides good information about what it’s done and why. Treat it like the apprentice.
Before enabling, review your bank rules and consider whether automation could introduce errors.
We would recommend monitoring it daily for the first little while, so you can capture and fix overnight mistakes early. It should improve as it goes along.

A final reminder that if you don’t like it you can turn it off again, but if you don’t give it a go, you’ll never know.

IRD gets tougher on unpaid business tax

Tue, 02 Dec 2025 03:28:00 GMT

What’s changing?

From October 2025, IRD has been sending some businesses with substantial unpaid tax a formal notice that they will be credit reported. The business will have 30 days to take action, such as setting up an instalment arrangement, before any credit reporting occurs.

Who’s affected?

· Businesses with tax debt that has been unpaid for a year and is at least 30% of the company’s profit, or

· Businesses that owe more than $150,000

Why does this matter?

Credit reporting impacts a business’s credit rating and ability to access finance. IRD shares information with Centrix, the approved credit reporting agency.

Options

If you can’t immediately pay the debt, please contact us to help set up an instalment arrangement or look at other options like tax pooling. Or you can set up an instalment arrangement yourself on myIR to stay in IRD’s good books!

Heads up! WorkSafe ramps up compliance inspections

Tue, 11 Nov 2025 03:07:47 GMT

WorkSafe NZ has announced a ramp-up in workplace inspections, including recruiting more inspectors and increasing site visits across high-risk industries like agriculture, construction and manufacturing.

These are compliance checks. Inspectors can arrive unannounced, ask to speak with workers, take photos, and issue formal notices if they find anything lacking.

What sort of hazards they are looking at?

Acute: vehicles and machinery, falls from height, falling objects, electrical and chemical hazards

Chronic: exposure to dusts, fumes and exhaust

Catastrophic: events that could cause multiple serious injuries or fatalities

Some things that trigger inspections

A recent ACC claim or notifiable incident
A complaint from a worker, neighbour, or ex-employee
A pattern of past non-compliance
Sometimes, just being in a high-risk industry is enough and there also seems to be a focus on the farming sector

What you can do

Review your health and safety systems
Make sure training records and hazard registers are up to date
Check that your team knows what’s expected if an inspector arrives

Useful client tools and calculators

Fri, 17 Oct 2025 04:57:21 GMT

When will YOU become a MILLIONAIRE?

Head to the calculator in our new super-useful CLIENT TOOLS section on our website to work it out!

Of course the team at Russell Turner is always happy to help answer any of your questions, but this fantastic one-stop shop provides free calculators, tools and links that might be just what you need. You'll find news sites, tax tools, stock exchanges, HR help, business planning and lots more. Crikey - you could even make it your home page!

Check it out under CLIENT TOOLS on the top bar of our website.

IRD scam warning

Wed, 27 Aug 2025 03:31:51 GMT

Be on the lookout for scammers pretending to be from IRD. Study official-looking emails carefully - even if you hear from an organisation often.

Scammers change their modus operandi often, but here are some current clues that show that an email from IRD is fake:

It is not from an official IRD email address
It does not include your name
There are links in the email, but they don't go to IRD's website

Remember that if something seems too good to be true, it probably is!

Check out the latest IRD scams here:
https://www.ird.govt.nz/managing-my-tax/scams/latest-scams

Livestock special alert

Wed, 16 Jul 2025 00:45:25 GMT

Inland Revenue have recently announced this year’s livestock Herd Scheme Values and we think this is a great opportunity to update you on the latest movements.

Click here to open the four-page report which covers dairy and beef cattle, sheep, goats and deer.

Budget 2025

Mon, 26 May 2025 04:21:33 GMT

Click to read the full report on the 2025 Budget.

Tax payable on rewards and gift cards

Mon, 26 May 2025 02:43:11 GMT

If you get rewards for buying from a supplier, IRD wants to know

Gift cards and rewards given for buying from a supplier are considered taxable income by Inland Revenue.

Before Christmas, IRD shared its view on how these incentives should be taxed. To keep this article straightforward, we’re assuming you’re running a regular limited liability company. The same rules apply to sole traders, partnerships, and look-through companies, except fringe benefits do not apply to the owners – these rewards are simply taxable income.

Trading trusts are a bit different since they don’t have working owners. Instead, employees (including beneficiaries or settlors) get incomes subject to PAYE.

Gift cards

If you’re given a gift card that can be used almost anywhere (an open-loop card), it’s treated like cash because of its flexibility to be used anywhere.

Taxable income

If you give the card to an employee, it’s like giving them a bonus.

You’ll need to deduct PAYE on the “grossed-up” amount. For example, if the card is worth $200, you’d calculate how much you’d need to pay to give $200 after PAYE deductions and include this in your PAYE return.

If the card can be used only in specific places (a closed-loop card), the rules are different. It’s considered a fringe benefit, so the $300 per person per quarter limit applies.

If you’re a shareholder-employee and keep the card, it’s treated as an unclassified fringe benefit.

Products from suppliers

If you get a spending reward like a barbecue, it’s taxable income based on how much you could sell it for. If you use it in your business, it becomes a business asset. At the moment Inland Revenue is saying you cannot claim depreciation. We are hoping this policy will change. The department is also saying if you use the rewards to reduce your debt to the supplier, you don’t get a deduction for the cost. Again, we hope this will be changed.

If you give it to an employee, it’s an unclassified fringe benefit and follows the same rules as closed-loop cards.

GST

Rewards include GST, so you’ll need to pay GST on them.

For the supplier

Businesses giving out these rewards can usually treat the cost as tax-deductible.

Points

Some suppliers offer points instead of gifts. IRD hasn’t clarified how to treat these, but it’s likely the income applies only once the points are redeemed for a gift.

Please contact your Russell Turner adviser if you would like clarification on declaring rewards and gift cards.

Crypto-asset profits are taxable

Fri, 07 Mar 2025 01:57:33 GMT

Just a reminder – if you make a profit out of investing in crypto-assets, that profit is taxable income.

Crypto-assets are cryptographically secured digital representations of value that can be transferred, stored or traded electronically. They use some form of distributed ledger technology such as blockchain. They are also known as cryptocurrencies, cryptographic assets, digital financial assets, digital tokens and virtual currencies.

Inland Revenue’s rationale is that the only reason you could possibly have for investing in crypto-assets is to make a profit. There’s generally no other form of income. Unlike a rental property, you don’t get a combination of income and capital gain.

However, some crypto-assets are paying a return on crypto held in the form of more crypto. In those cases there is an argument that it is purchased for that purpose not sale.

Two key developments in the past year highlight the importance for taxpayers with crypto-assets to make sure their tax matters are in order – failure to do so could lead to an unpleasant surprise from Inland Revenue.

In general, transactions involving sale, exchange, or trading of crypto-assets are taxable on realisation: when someone sells a crypto-asset, the proceeds from the sale are subject to tax, although they can deduct the cost of acquiring the asset. Sales can involve government-issued fiat currency (such as NZD) or be used to purchase another crypto-asset. This is a broad guideline, and specific tax rules may vary depending on the situation.

If income is generated from crypto-asset activities, it must be included in a taxpayer's income tax return. For New Zealand tax residents, this applies even to crypto-assets bought or sold outside the country, such as when using a non-New Zealand-based crypto exchange.

Development #1: Inland Revenue's focus on Crypto-assets

In July 2024, Inland Revenue announced it would focus on investigating taxpayers who fail to report income from crypto-assets. The agency reminded the public that, contrary to the belief that transactions on the blockchain are anonymous, it has the tools and technology to track crypto-asset activity.

With an additional $116 million allocated to compliance efforts in the 2024 Budget, taxpayers should expect an increase in inquiries and requests for information. The Commissioner of Inland Revenue confirmed that Inland Revenue would gradually reach out to crypto traders, informing them of the data the agency has and offering a final opportunity to report any unreported income.

Inland Revenue’s system has identified 227,000 New Zealanders with crypto-assets and tracked 7 million transactions worth $7.8 billion. This is likely just the beginning, as Inland Revenue continues to gain access to more data related to crypto-asset activities.

Development #2: The Crypto-Asset Reporting Framework (CARF)

As part of the 2024 Budget, Inland Revenue received extra funding to create a Crypto-Asset Reporting Framework (CARF). According to the Regulatory Impact Statement (RIS), the decentralised nature of crypto-assets and limited regulation have made it difficult for tax authorities to fully track income generated from crypto activities. While Inland Revenue can monitor some transactions, a formal reporting system would provide a more efficient way to gather and oversee crypto asset data.

CARF is an initiative led by the OECD. It’s a framework for a reciprocal international exchange of information on crypto-asset activity between jurisdictions. As a global minimum standard, all OECD countries are expected to adopt the framework, and as of May 2024, 50 countries had committed to participating.

CARF will require crypto intermediaries to provide tax authorities with information about users on their platforms. This information will be automatically shared with other CARF-compliant jurisdictions. The data provided will include personal details (e.g., name, address, date of birth, and tax ID number), along with transaction details at both the user and aggregate levels.

This data will cover crypto-to-crypto exchanges, crypto-to-fiat transactions, and transfers to wallet addresses on the blockchain. CARF will also establish rules for currency translation and asset valuation. For example, the value of the crypto-asset must be reported in the fiat currency in which it was either paid or received.

CARF is expected to be implemented starting with the 2026/27 tax year, and the first data exchange will take place in 2027. The initiative is estimated to generate an additional $50 million in tax revenue annually from 2027/28 onwards.

The RIS suggests Inland Revenue might begin pre-populating income tax returns with crypto-asset income, a process that could be made easier with tax reform aimed at simplifying the calculation of taxes on crypto-assets. Watch this space for potential legislative changes in the future!

Do get in touch with your Russell Turner adviser if you have any questions on crypto-assets.

Got overseas trustees or beneficiaries? You might need our help!

Tue, 12 Nov 2024 00:06:31 GMT

Having overseas beneficiaries or trustees for a New Zealand trust can lead to tax complications

Having overseas beneficiaries or trustees for a New Zealand trust can lead to tax complications in some overseas countries, including Australia. Here’s a summary of common scenarios where this may occur:

Tax Implications for Australian Beneficiaries

Distributions from New Zealand trusts to Australian tax residents are often taxable in Australia. This can include situations where the distributions are not taxable in NZ – including, for example, trusts distributing money that include capital gains or investment gains. This can affect both distributions now, as well as future inheritances. We would recommend getting advice from us, your Australian accountant or your lawyers if this is the case.

Overseas beneficiaries elsewhere

Distributions to beneficiaries who are tax residents of other tax jurisdictions may also attract tax overseas, depending on the tax laws of the country they are residents in. We recommend getting advice from your overseas accountants to ensure we can plan accordingly.

Risks of Appointing an Overseas Trustee
If a New Zealand trust appoints an Australian tax resident as a trustee, the entire trust’s assets and income may fall under the Australian tax net – including (for example) Australian capital gains tax. Other countries may have similar rules. We tend to recommend appointing trustees who have their tax residency in NZ only, in order to prevent unintended tax liabilities.

If you have any questions about this, please be in touch with our team .

Budget boost for families

Fri, 02 Aug 2024 06:05:37 GMT

Make the most of recent changes to paid parental leave and early childhood subsidies

Paid parental leave rate changes

From 1 July 2024, paid parental leave payments increased for eligible employees and self-employed people from $712.17 to $754.87 per week before tax. The minimum rate for self-employed people went from $227.00 to $231.50 per week. This is equal to 10 hours of work per week, at the adult minimum wage.

Introducing FamilyBoost

FamilyBoost is a new childcare payment that is available to low-to-middle-income families with children aged 5 and under, to help with the costs of early childhood education (ECE).

From 1 July 2024, parents and caregivers are eligible for a partial reimbursement of their ECE fees, up to a maximum fortnightly payment of $150. Reimbursements will be made quarterly, as a lump sum.

You will need to apply via Inland Revenue’s online account, myIR. You can only claim once in a three-month period, so from 1 October you’ll be able to claim your ECE invoices for the period 1 July – 30 September by uploading them in myIR. Continue collecting invoices for your next FamilyBoost claim on 1 January, which will cover invoices for the period 1 October 2024 – 31 December 2024. You can save up your invoices to claim less often i.e. six monthly or annually.

Parents and caregivers can get back up to 25% of their ECE fees, after the 20 Hours ECE and MSD Childcare Subsidy have been taken into account, up to the $150 maximum.

This maximum payment slowly reduces for family incomes over $140,000 per annum. Families with incomes over $180,000 per annum are not eligible for FamilyBoost.

Please get in touch with the team at Russell Turner if you have any queries about paid parental leave and FamilyBoost.

Budget 2024 - what do I need to know?

Mon, 10 Jun 2024 01:48:18 GMT

In brief

Forecast return to surplus in 2027/2028
Real GDP growth forecast of 1.7% in 2025
Unemployment rate forecast to increase to 5.2% in 2025
Inflation forecast to fall to 2.2% in 2025

Tax threshold changes from 31 July 2024

Where income thresholds are not inflation-adjusted regularly there will always be issues as to what is the right time to do it. Many countries automatically adjust income tax thresholds for inflation (either annually or within a prescribed timeframe, eg 3 years).

Business

The budget does not deliver significant tax relief to business, however the new Ministry for Regulation has been given large allocations. It would be hoped that improvements in the burden of bureaucracy (along with the renewed focus on roading) might assist business indirectly – though this is not a reforming budget.

IRD

IRD will receive extra funding for compliance activities (audit).

Independent Earner tax credit

For people in paid work who don’t receive other government assistance
Threshold increased from $48K to $70K

Early childhood fees

A partial reimbursement of early childhood fees (first payment October)
Reimbursements made quarterly as a lump sum

Restoration of interest deductibility for residential rental property and bright-line test changes

These have already been announced .

Regional Infrastructure Fund - Northland Flood Resilience Projects

Dargaville to Te Kopuru stopbank upgrade
Kawakawa deflection bank
Matangirau flood risk reduction phase 2

As always, please get in touch with your Russell Turner adviser if you would like to discuss how these announcements affect you.

Latest key tax announcements

Mon, 20 May 2024 22:00:15 GMT

Trustee income changes :: Depreciation :: Bright-line test :: Family boost :: Residential rental income

Image: 123RF

Trustee Income to be taxed at 39%

The Trust tax rate will change to 39% for the 2024/25 income year. Trustee net income of $10,000 or less is to be taxed at 33%.

Depreciation 0%

The depreciation rate on commercial and industrial buildings will be 0% from the beginning of the 2025 tax year.

Bright-line Test

From 1 July 2024 it is proposed the three existing bright-line tests will be abolished. In their place there will be a two year bright-line test. Bright-line will apply if the bright-line end date is within two years of the bright-line start date. The two years will apply retrospectively from 1 July 2024 so that if the bright-line start date is before 30 June 2022 the bright-line end date will be 1 July 2024 at the latest.

Family Boost

Starts 1 July 2024
25% of early childhood education (ECE) fees - maximum $75 per week
More details to be announced in the budget (30 May 2024) including how to apply for FamilyBoost

Interest deduction on residential rentals

There have been significant changes to the tax deductibility of interest paid to buy residential rental property.

The current situation is:

Year ended 31 March 2024 – 50% of interest is claimable on property where the sale and purchase agreement was dated on or before the 27 March 2021.
Year ending 31 March 2025 – the cut-off date is dropped and interest deduction is partially allowed for all borrowing. The claim is limited to 80% of the interest incurred.
Year ending 31 March 2026 onwards – full tax deductibility of interest is restored.

If you would like any additional information on the above, please feel free to contact us.

Five things to think about before 31 March balance date

Wed, 06 Mar 2024 23:14:09 GMT

March 31st signals the end of the financial year for many - here are some areas to focus on

Bad debts

Review what your customers owe you. It is best to write off any bad debts prior to your balance date so that you get the claim in this financial year.

Stock

Cull your stock. If some of it is only fit for the tip then get rid of it. Remember, stock has to be valued at its cost, including the cost of getting it into your shop, warehouse etc. You may use market value, if it is lower than cost, instead of cost for an item, but you will need to keep evidence to show where you could have bought the item at the lower price.

Fixed assets

Review your fixed asset list for any scrapped items. You’ll find a copy of your fixed asset schedule in your last year’s financial statements. Give us the list of the scrapped items along with the rest of your paperwork for this year’s financial statements.

Motor vehicle

If you are going to make a claim for use of your vehicle for business on a kilometre rate basis, remember to read your odometer at the end of the day on balance date.

Vehicle logbook

If you need to keep a vehicle logbook, this needs to be for a continuous typical three months of vehicle running. A new recording needs to be made once every three years (or more often if there is a major change – more than 20%) in the proportion of business and private running.

As always, feel free to get in touch with the team at Russell Turner to discuss your situation ahead of year-end.