As a new financial year approaches, it’s important to stay on top of the tax regulations and keep abreast of any impending changes that might affect you and your businesses. Staying informed ensures effective tax planning and compliance. Diane Gill attends regular webinars and meetings to ensure she is up to date with the latest tax changes that could affect you. Here are some highlights from a recent webinar you may need to know. 

#1. Proposed new tax rate for Trusts.

The Inland Revenue has released information about increasing the trustee income tax rate from 33% to 39% in April 2024. Although this change is currently still in Bill form, it is predicted it will be law by the end of March. 

In the NZ Herald, business editor Jenee Tibshraeny explains that Finance Minister Nicola Willis wants to exempt some trusts from paying the increased tax rate. She has hinted at modifying the bill. So, watch this space. 

#2. Taxation for Uber and Airbnb

There has been further discussion around taxation rules for the Platform Economy which covers businesses like Uber and Airbnb. Early this year, Airbnb asked the finance minister for more time to ensure GST is paid on all stays through its platform. However, Nicola Willis has said the Government has no plans to defer the date. This means that Uber ride-share services and Airbnb will need to ensure GST is levied on all New Zealand services booked via their websites as of April 1st.  This also applies to hosts and drivers who fall under the $60,000 annual revenue threshold for businesses that don’t need to register for GST. 

Last year, National did promise to scrap the rule but has now decided to proceed with it. For more information or to discuss the impact on your business please get in touch.

#3. Gifts not treated as Assessable (taxable) income. 

Generally speaking, gifts are not usually subject to income tax. A ‘gift’ refers to an amount of money gifted to a benefactor that the payer receives no financial benefit from in return, for example, a koha. However, there are some circumstances where a gift may be liable for income tax. For example, the gift was related to employment, such as gifting a vehicle to the recipient whereby the vehicle is used in an income-earning activity. 

There has been some discussion regarding situations where gifts are not treated as Assessable (taxable) Income. The main example of this was when strangers made gifts to people badly affected by Cyclone Gabrielle. As always, each scenario can be different, so it is best to seek advice if you have this situation.

Need financial advice? Get in touch.