Hello
The season of spreadsheets, receipts, and “where did I save that?” is upon us! With the end of the financial year nearly here, now’s the time to pull together key information, double-check expense claims, and give your record-keeping a quick health check.
We know tax prep isn’t anyone’s favourite job, but a little housekeeping now can keep costs down, reduce back-and-forth, and help us prepare your return more efficiently.
The annual checklists are ready for you to complete so that we can get your 2026 accounts and tax returns done. Please remember to wait until you have all your information before sending it to us.
Please sign the checklists, as this gives us permission to prepare your accounts and tax returns. The checklists are available in our resources section. You can also fill in the checklists through our online forms.
We can get your interest, dividends, wages, salaries and PIE income from Inland Revenue. We will still need the tax report for Investment Portfolios, which won’t be available until June.
Rachel is in the Amberley Office on Wednesdays. Feel free to drop in on any Wednesday from 9:00 – 2:30.
End of year tax planning:
There are several things you can do to help us get your annual accounts correct, including:
• Review last year’s Schedule of Fixed Assets. Let us know if any assets have been scrapped, sold, or traded in.
• Do a stock take and remember to value the stock using GST exclusive prices
• You can use Cost, Replacement Price, or Market Value to calculate the value of your closing stock. We recommend cost for most situations. Physically dispose of any obsolete stock so it doesn’t need to be included in the stocktake.
• Bad debts: make sure that any bad debts have been written out of the debtors’ ledger by 31 March 2026, so that we can claim them as an expense.
• Count livestock on hand.
• Have you bought any fixed assets for the business? If so, let us know, and we’ll determine whether it should be depreciated (including considering the new 20% investment boost deduction) or treated as an expense.
• If you have any business lending, please let us know about any repayments or recent changes so we can record interest and balances accurately.
Overdue PAYE
Inland Revenue have issued an alert regarding failure to pay PAYE deductions to Inland Revenue.
They have stated that any employer who deducts PAYE and related amounts from salary or wages and, knowingly, applies the deductions for a purpose other than in payment to Inland Revenue commits a criminal offence. This means a director can be prosecuted for this.
If you have other overdue taxes, please make sure you pay your PAYE first.
Profits in Companies that provide services
Inland Revenue have been focusing on companies that don’t pay out all their profit as shareholder salaries. In a service company, they expect to see most, if not all, of the profit paid to the shareholders.
Many people prefer to leave the profit taxed in the company, as this is often at a lower tax rate (28%). Any profit left in the company will still need to be paid to the shareholders at some time in the future as a dividend, with dividend withholding tax payable at 5%. If you also have an overdrawn current account, Inland Revenue may choose to treat the amount of your current account as paying a dividend, and you will be required to pay the DWT.
Rental Property Interest
From 1 April 2025, you can claim 100% of the interest incurred for funds borrowed for residential property. This is regardless of when the property was acquired or when the loan was drawn down.
Interest deductions that were previously disallowed between 1 October 2021 and 31 March 2025 will remain disallowed unless the property is sold and subject to tax.
Investment Boost
If you purchased an asset over $1,000 after 1 April 2025 you can claim an extra 20% depreciation in the asset’s first year if it is brand new, or new to NZ. There is no maximum amount for the purchase price.
Minimum Wage from 1 April 2026 is $23.95.
Kiwi Saver Employer Contribution
From 1 April 2026, employers are required to increase their contribution to 3.5%. Please ensure your payroll is up to date. From 1 February 2026 you can apply to reduce the rate to 3%, and the rate reduction will start from 1 April 2026, when the change to the default KiwiSaver contribution rate from 3% to 3.5% comes in.
Individual Tax Rates
Personal income tax rates and income tax thresholds are
| For each dollar of income | Tax Rate |
| 0 – $15,600 | 10.5% |
| $15,601 – $53,500 | 17.5% |
| $53,501 – $78,100 | 30% |
| $78,101 – $180,000 | 33% |
Trust Tax Rates
The Trust tax rate is 39% for profits not distributed to beneficiaries. Trusts with profits below $10,000 can continue to use the 33% tax rate.
ESCT Rates
Please review your employees’ ESCT rates and make sure they are at the correct ESCT rate.
| income range | ESCT |
| 0 – $18,720 | 10.5% |
| $18,721 – $64,200 | 17.5% |
| $64,201 – $84,000 | 30% |
| $84,001 – $261,000 | 33% |
Working for Families – Best Start
For children born on or after 1 April 2026, the weekly payment of $77 is reduced when the family income is over $79,000.
FuseSign
We are using FuseSign to electronically sign accounts, minutes and tax returns that are sent out via email. Please ensure that the signees have separate email addresses and cell phone numbers if you wish to use this.
Upcoming Tax Dates
| 31 March | Final Due Date for the 2025 income tax returns |
| 7 April | 2025 Terminal Tax is due |
| 7 May | The third instalment of 2026 Provisional Tax payment is due for March balance dates. March 2026 GST is due |
Other Services we offer:
- GST Return completion
- Wages calculations and filings
- Preparation of Budget and/or Cashflow
- Xero Training & Support
If you would like to discuss our other services, please email rachel@liddellandco.nz or call us on 03-352-1076.
