Business is not financial science; it's about trading, buying and selling. It's about creating a product or service so good that people will pay for it. (Anita Roddick)
Every business has to do a tax return each year. The TV show Black Books had me hooked when the first episode dealt so well with this 😄. We live in one of the easiest places for tax returns. Obviously countries not requiring tax returns are easier. Interestingly there's even been a recent suggestion by an Australian CA they should ditch income tax - and it had a lot of merit. Meantime you still have to get the basics right. This is even more important as IRD plans to "simplify" things even more. When you run a business, you have some options.
You can ignore this requirement and wait for IRD to catch up. Given the tax penalties that apply to such a choice, that's not a responsible choice for business owners who want a future for their business.
You can do it yourself. That get the job done - but you might overlook something and again face penalties. What might you do wrong? We'll ignore things like the companies, partnership and trustee acts - and the question they pose as to what form you should trade under. Have you ever seen the tax act? In case you didn't know, legislation is online so you can easily see it. In fact there are three main acts - tax, GST and tax administration. And of course each act has been seen various legal challenges, which if they haven't seen the law changed, provide an interpretation of it. So to really understand it, you have to also have an understanding of these cases. Of course IRD does not sit still. There are always amendments being developed. Sure they might change again once enacted, but it pays to know how these might affect you in the future.
If you're taking responsibility for it, good luck. Some legislation (e.g. look through companies) is so complex with so many pitfalls that many professionals prefer to avoid it. (In fact LTC's have been reviewed by IRD and is now not quite the monster they created.) Recent changes challenge long established principles, and lead to different opinions from "experts". Even if you're not affected by complex changes, there can be less obvious variations to apparently simple rules.
Your other choice is to get someone else to do it - but even when you choose this path, it is still your responsibility. That is why if you use our services, we will need to work together to ensure that the information in your return is as complete as possible. By doing this we minimise the need for them to ask more questions - and if they do, we can usually answer them for you from information you have already provided.
If you register with an IRD tax agent and are up to date with your taxes, you will be granted an extension of time. This means your returns for say March 2017 are actually due by 31 March 2018 instead of 7 July 2017. Of course that's not a target anyone should aim at - it's good to get the accounts done much earlier in the year. Apart from anything else, accountants need time to prepare and file the returns, and to think about what the accounts mean for your business (although if done just in time, the answer is probably not much). Of course if you already have arrears etc, then we need to finalise and file and pay everything by 7 February - not onerous but best avoided. If you lose your extension of time, we are back to having to file by 7 July.
You can have accounts and returns done by a professional accountant - or not. You'd hardly be surprised to find I'm biased. Not biased enough to say all my colleagues are better than all the rest - there are some good accountants who for various reasons choose not to belong to either CPA Australia or the new trans-Tasman Chartered Accountants. Sadly most business people can't tell the good from the bad - until it's often too late. An an example, a new client was not given proper advice before proceeding with a land deal. It cost him an extra $50,000 - which he could never get back. That's why I'm biased enough to say you should expect a professional job from a qualified accountant - but you take your chances with others. Those of us in public practice are subject to regular reviews to ensure we comply with professional standards. And if we don't, our professional bodies takes complaints very seriously. Also to be in practice we have to have professional indemnity insurance.
So if you want your accounts and tax returns done reliably and professionally, give us a call or email or Skype (actually suits us - we work that way) and have a chat. We have a unique way of working (e.g. mainly over the internet) so we're ideally suited to clients who want support to use their own system reliably - and who want regular advice and support from their accountant. Or we can set you up with a bank feed and do GST and accounts from there.
So if you want to know more browse our site to learn more - and then get in touch.