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Tax & AccountingMarch 20, 2024

Your 12-point checklist to stay ahead on tax

As we approach the end of the tax year and move into 2024-2025, let’s make sure your finances are in the best possible shape.

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2024 Wolters Kluwer 12 point checklist for tax year end NZ

1) Contracts

Have you invoiced retentions that don’t need to be paid until next year? If they are payable this tax year, they will be classed as taxable income for 2023-24.

2) Employee expenses and holiday pay

You can claim holiday pay, bonuses, redundancy payments, and long service leave owed to employees this year if you have committed to them at year-end and pay them within 63 days of the balance date. 

Ensure holiday pay has been calculated correctly to avoid time-consuming revisions once the tax year is over.

3) Credit notes

Identify credit notes issued to customers after balance date. You may be able to apply them to the current tax year and reduce your taxable income.

4) Expenses

Can you prepay expenses before March 31 for items such as stationery, postage, and courier charges to claim deductions sooner?

5) Debtors

Before end March, review your debtors and list outstanding bad debts. Ensure your records show you’ve taken reasonable steps to recover them. Bad debts written off before March 31 can often be claimed as a deduction.

6) Fixed assets

If you’re not using some assets, you may be able to write them off.

7) Tax losses (carryforward, offsets and subvention payments)

Set to make a loss in the current financial year or have tax losses from prior years? Talk to your accountant about carryforwards, loss offset elections and subvention payments.

8) Discounts for prompt payment

If you’ve offered prompt payment discounts over the tax year and maintain a discount reserve, this might be deductible. Keep clear records about any discounts.

9) Repairs and maintenance

Do repairs or maintenance before the year-end to claim deductions. Consider software development and improvement costs as part of this.

10) Dividends and imputation credits

Review dividend payments for the year by March 31. Imputation credit accounts mustn’t have a debit at year-end, or you could incur penalties. Review deemed dividends (for example, overdrawn shareholder current accounts with no interest charged).

11) Stock 

Dispose of obsolete stock by year-end or write it down to its net realisable value (the lesser of cost or market value). 

If your stock is worth less than $10,000 and your turnover is less than $1.3 million for the year, you won’t need to include stock movements for tax purposes.

12) FBT 

Review FBT. Have you taken account of possible exemptions? The FBT March quarter return is the year’s last quarterly return and will most likely require a wash-up calculation.

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