Welcome to the Vision Accounting June e-newsletter. This is a great way for us to share important information you need to know, helpful tips and hints and practical resources to help you in business for 2014.
At Vision Accounting, it has certainly been an action packed month helping our clients with end of year financials, GST and compliance requirements. If you haven’t got your end of year records to us, please do soon. We can then process them for you and let you know your tax payments for the IRD. As we know, cashflow is king, so the more prepared you are for payments, the better for forecasting and there are no nasty surprises.
We are delighted to continue to support small to medium businesses through our gold sponsorship
of the North Harbour Business Association
. We encourage all businesses on the shore to consider this worthwhile organisation and the benefits and opportunities it could offer them.
Here is some information which may also help you in your business.
What you need to know:
SUPERANNUATION: DECISIONS, DECISIONS
If you have (or had) funds in foreign superannuation schemes, let us know. Recent changes to legislation may affect you.
Read on to find out more.
I transferred my Australian super to KiwiSaver. Is it taxed here?
Transfers from complying superannuation funds in Australia into KiwiSaver won’t be taxed in New Zealand on transfer. However, future earnings on these transfer funds will be taxed as normal KiwiSaver investments.
This isn’t the case with transfers from other countries – there are different New Zealand tax implications on transfers in these cases. However, under the new rules, if you transfer non-Australian foreign superannuation into KiwiSaver after 1 April 2014, you will be allowed to make a withdrawal from KiwiSaver to pay your tax bill.
I withdrew (or transferred funds) from my foreign super last year. What are the tax implications in New Zealand?
If you withdrew or transferred funds anytime between 1 January 2000 and 31 March 2014, and have not previously accounted for New Zealand tax on these funds, you will be able to meet your tax obligations by paying tax on 15% of the amount transferred or withdrawn. The remaining 85% of the withdrawal will not attract income tax. This adjustment must be shown in the tax return for either the 2013-14 or 2014-15 income years.
For a limited time, you can choose to calculate your tax liability using this concessionary 15% rate option without penalties or interest. Alternatively, you can apply existing law (which may involve imposition of penalties and interest).
Talk to us to work through the options that are best for your situation.
I’m Confused. I’ve been declaring my foreign super under the FIF rules. What happens now?
The current foreign investment fund rules will no longer apply to foreign superannuation schemes from 1 April 2014. However, if you previously declared your foreign superannuation and used the foreign investment fund (FIF) income rules prior to 20 May 2013, you may choose to keep using them in relation to your foreign superannuation interest after 1 April 2014 under the ‘grandparenting’ provisions.