Uncategorized - Knobloch & Associates - Page 2

The Court of Appeal recently ruled against Alesco NZ Ltd (a wholly-owned subsidiary of Alesco Corporation, an Australian company) regarding their use of optional convertible notes (OCNs) to fund a business acquisition. In simple terms, the OCN is a form of loan subject to a zero percent interest rate that could be exchanged for shares...

One would be forgiven for thinking that the Government’s recent back down on charging FBT on carparks located in the Auckland and Wellington CBDs means that the status quo remains. However, the draft legislation as it was introduced includes four proposed changes that would see FBT apply when: Carparks are provided in the Auckland and...

The minimum contribution rate for employers and employees will increase from two percent to three percent of gross salary or wages from the first pay period commencing on or after 1 April 2013. Employers will need to change the contribution rates for existing KiwiSaver members if the employee’s contribution rate is two percent. If the...

Removal of Tax Credits Three tax credits have been repealed effective from the 2013 income year. These are: tax credits for income under $9,880, childcare rebates and housekeeper rebates. Taxpayers will still be able to make claims for the above for the 2012 tax year and previous years. Student loan voluntary repayment bonus removed Effective...

Taxpayers may/may not be aware that a further nine categories of “income” are included in addition to a person’s taxable income to calculate the Working for Families Tax Credits (WFF) from the 2012 income year. These are: Attributable trustee income; Attributable fringe benefits; PIE income; Passive income of children; Income of non-resident spouse; Tax-exempt salary...

One of the most difficult decisions to make as a business owner is how much to charge for your products. There is often a reluctance to review pricing because of the fear of upsetting existing customers or due to a lack of time. However, there are several actions you can take to make your pricing...

The Government has introduced a Bill into Parliament that will limit taxpayers’ ability to claim a tax deduction for costs associated with mixed-use assets, i.e. assets that are used both privately and rented to third parties, for example baches and boats. When enacted, the new rules will apply from 1 April 2013. The new rules...

In an effort to reduce uncertainty regarding the tax treatment of employee reimbursements and payments for meals, accommodation, communication and clothing, the IRD released an officials’ issues paper in November 2012. The IRD is seeking feedback on proposals to introduce legislation specifically pertaining to these types of expenditure. Meals Employee meal costs when travelling for...

When a landlord makes a payment in cash to induce a tenant into signing in to a lease, the payment is usually deductible to the landlord. Under the existing rules, a lease inducement payment received by the tenant is non-taxable. This was confirmed in a ruling by the Privy Council case in CIR v Wattie (1998)...