15 February 2023

As a business owner, it's important to know your tax obligations and to make the most of the available tax planning strategies at your disposal when planning for the end of the financial year. If you’re not making use of these tax strategies in your business, you could be leaving valuable profits on the table!

1. Maintain accurate financial records

Keeping accurate records of all your income and expenses are the building blocks you need to put in place to help your business maximise tax planning strategies. Without accurate records, it’s almost impossible to understand your financial situation. Additionally, it makes it simpler for you to file your taxes and reduces the chance of mistakes or discrepancies, which could lead to fines or penalties from the Inland Revenue Department (IRD).

2. Utilise tax deductions

Do you understand the tax deductions available to business owners? Business costs, asset depreciation, and costs for a home office are just a few examples of deductible expenses you could be taking advantage to help lower the amount of your taxable income, so you pay less tax.

3. Think about tax planning techniques

Before the financial year ends, you should also consider tax planning tactics. For example, could you bring forward any expenses you plan to pay in the next financial year, which can help you reduce your taxable income in the current financial year? Alternatively, income received may not be derived until the next financial year, which can help you pay less tax in the current financial year.

4. Consider tax pooling

A tax pooling arrangement allows you to defer tax liabilities and pay interest as a lower rate. Banks like tax pooling as it is unsecured debt, and it also allows you to combine your tax obligations with those of other associated taxpayers. This can be a useful strategy to help businesses manage cash flow and reduce their risk of fines or penalties for not paying enough tax.

5. Don’t go it alone

Nobody wants to pay more tax than they have to. To help ensure your business is making the most of the tax breaks at its disposal, it's a good idea to get professional advice from a tax consultant to figure out what your tax obligations are, look over your finances, and give you advice on tax planning strategies that may work for your business.

Register for our year-end tax planning webinar

Join us at 12pm NZT on Thursday 9 March to get a head start on the competition by preparing your business for the end of the financial year. Our tax experts will discuss what tax planning opportunities could be beneficial to you and the changes that have occurred in recent years that all businesses should know about.

REGISTER YOUR PLACE