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Are you ready for RLWT?

Residential land withholding tax (RLWT) kicks in on 1 July 2016. “Offshore RLWT persons” who sell land subject to the bright-line test may have RLWT deducted from their sale proceeds. Primarily, the vendor’s conveyancer will be responsible for deducting the tax, however, accountants may need to assist with calculating the amount payable to Inland Revenue.

The tax was introduced as a means of ensuring that offshore taxpayers who are required to pay tax under the bright-line test meet their New Zealand tax obligations. Collection of income tax from these taxpayers is more challenging then from New Zealand based taxpayers, and so deducting at source can be seen as a way around the issue. Read more

February tax bill – what’s in store for you?

On 26th February, the Government introduced the long-awaited Taxation (Annual Rates for 2015-16, Research and Development and Remedial Matters) Bill. This post provides a brief overview of what tax changes are in the pipeline. Read more

Imputation credits & resident withholding tax – reminder

As year-end is approaching quickly, it is important to remember that the maximum imputation ratio for dividends is 28:72 for the 2012 income year (previously 30-70 up to end of the 2011 income year). The Resident Withholding Tax (RWT) rate on dividends remains at 33 cents in the dollar meaning dividends are still taxed at 33% in the hands of the recipient (i.e. shareholder). RWT must be paid by the company for the imputed dividend shortfall. Read more

Australia New Zealand DTA enters into force

Yesterday the Government announced that the new Australia/New Zealand double tax agreement has entered into force. This means that both countries have completed their domestic law requirements for incorporating the treaty into their respective laws. The way is clear for the provisions of the treaty to apply.

The application dates are different for different types of tax. The first relevant application date is the provisions relating to Fringe Benefit Tax (“FBT”).  Briefly the Article provides that FBT will follow the taxing rights of salary and wages, thereby reducing the possibility of double FBT. The provisions apply from 1 April 2010, and is slightly different compared with the 1995 treaty position.

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International Charities’ help required

Are you an international charity that has recently applied for listing on Schedule 32 of the Income Tax Act 2007?  Or do you have a client in this position?  If so, we would like to hear from you.

Very briefly, Schedule 32 status is afforded to a select few international charities, and with the lifting of the caps on donations credits and deductions, there has been a flood of applications to be listed.

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Income Splitting Issues Paper Released

On 11 December 2009 the Government released an issues paper on income splitting.  The paper fleshes out the UnitedFuture proposal, which has support from the Government to first reading as part of the coalition agreement.

Married, civil union and de facto couples would be able to split their income 50/50 to take advantage of lower marginal tax rates.  The lower rate will be delivered by way of a credit through the Working for Families system.

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Recent comments

  • Joanne Martin: Hi Would you be able to email me to discuss a small company that is an LTC which I need some advice on...
  • Rizwana Saheed: You are on the right track that there is an exemption when employees work overtime but whether or not...
  • bryan: as a group of employees we get paid meal money if we exceed 11hrs on any day. Employer says he wants to tax...
  • linda: My mother is 94 and has dementia. With govt assisted carers she is still living in a home gifted within the...
  • Sharon: Hi Daniel, Can you please advise how owners of a profit-making LTC pay themselves? The owners used to pay...
  • Another Anne: My Dad is in care on full subsidy. I am EPOA. Are we able to gift some money to my brother in UK so...
  • Twagilayesu Isaya: I agree with the author of this article that Inland Revenue Department need to provide clear...
  • Quinn: Hi. I would like some clarification regarding the valuation of the investments component of the owners basis...
  • QROPS Pensions: Interesting piece of writing, you always write the most useful content & TalkTax is no exception...
  • Davo: Jo, quite likely is that the transition to an LTC was not done in time and the company became a normal company...

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