Taking every opportunity
Another financial year done and dusted, congratulations.
Given the time of the year we thought it was a chance to shine the spotlight on one of our friendly accountants, Fraser Hannon. Fraser, an experienced rugby referee, now finds himself as Otago’s top referee with Jono Bredin having moved to Hawkes Bay at the end of last year.
Fraser made his debut at Super Rugby level, assistant refereeing three of the early rounds of Super Rugby in Dunedin. When not a part of the on field Super Rugby refereeing team he can be found on the sideline of the Highlanders home games controlling the substitutes movements on/off the field and assisting the professional referees with their match day duties.
Fraser will be busy in the weekends for the next couple months with local premier club games and the occasional secondary school 1st XV game. Fraser is a member of the NZ Rugby National Referee Squad and will be heavily involved in the representative competitions later in the year, controlling games in the Farah Palmer Cup, Heartland Championship and Bunnings NPC. With games all over the country Fraser enjoys the travel it brings, the frequent banter he receives from players and spectators and the connections he builds with fellow referees in the local area. We wish you luck for the season Fraser.
Photo: The two Fraser's - Fraser Hannon on the left, and Michael Fraser, at last weekend's Highlanders home match v the Blues.
More sporting success.....
Keeping the sporting theme going, earlier this year James Nation, our General Manager, was named as a selector for the Blacksticks Men’s Hockey Team through to the 2024 Paris Olympics. Having played for the Men's Blacksticks and attended both the Athens and Beijing Olympics, James has been actively involved in local Otago hockey since retiring. He joins a selection panel of three which assists the head coach Greg Nichol name a national squad and teams for major events. For this year, these events are the Commonwealth Games in July/August and the World Cup in early 2023.
As a selector James enjoys the decision making required to balance short term team performance versus the long-term plan within the high-performance program, picking players with the right attributes and skill, but also understanding the individual fit within a wider team dynamic. Sounds like building a team in any business!
As an organisation we are fully supportive of these extracurricular activities, they help develop our staff, expose us to new ideas and we also get insight into what is happening in sporting circles. It also gives us greater understanding when we work with the many sportspeople we have as clients.
Over the course of the year we will introduce our staff that are out there using their skills to support their passions outside
The new financial year
Some reminders as we complete the financial year end, there are several payroll updates that come into effect today. These have been well publicised but just in case you missed them. Any concerns/questions you have please get in touch with us.
Minimum Wage Increase
Adult Increasing from
$20 to $21.20
Starting out / training Increasing from $16 to $16.96
Student Loan Threshold Increase
Student Loan payments are deducted on earnings over the threshold amount at a rate of 12%. The threshold is increasing from $20,280 to $21,268 per year.
The rate change will be effective for the first pay run after 1 April 2022.
ACC Levy increase for 2022/2023 year
Increasing from 1.39 percent to 1.46 percent. For every $100 gross this will be $1.46. Effective from the first pay run after 1 April 2022. ACC is part of the PAYE content deducted from wages.
*Earnings greater than $136,544 do not have the ACC levy applied.
Employer KiwiSaver Contribution - ESCT Tax Rates
The Employer’s KiwiSaver Contribution is taxed, and this percent is dependent on the employee’s expected annual income.
These rates need to be reviewed for the start of the new tax year. For more information can be found at this blog
from Smartly Payroll.
Is it time to review your Trust?
As we work through the 2022 annual accounts there will be a noticeable increase in the amount of information required to complete the IR6 Trust/Estate Income Tax return.
It got us thinking that it maybe timely to assess whether
your Trust is relevant and compliant.
With between 300,000 and 500,000 Trusts in New Zealand, they’re clearly a popular way to protect assets. However, the Trusts Act 2019 came into force on 30 January 2021, bringing key changes to the way Trusts are run and imparts stronger duties upon Trustees. If you have a Trust, you’ll need to weigh up the benefits of continuing with your Trust against the increased compliance costs.
So, why did you set up your Trust? Are those reasons still relevant? Here are some of the most common reasons for forming a Trust:
Asset protection: Trusts can protect personal assets from creditors in the event of personal bankruptcy or the insolvency of a company (if the donor was solvent when the assets were transferred into the Trust), and from any personal liability as a company director.
Continuity: Trusts can continue to operate after the death of the Settlor without any immediate need to sell assets to distribute among beneficiaries. This means assets can be progressively distributed to beneficiaries and distribution to vulnerable beneficiaries can be delayed. Trusts can now continue for up to 125 years (previously they were limited to 80 years).
Government claw-back: Previously, a key benefit of transferring assets into a Trust was to enable the Settlor/s to access residential care subsidies. However, new rules make this almost impossible to claim now if you have assets in a Trust.
Property (Relationships) Act: A Trust can be used to prevent family assets becoming inter-mingled property and therefore exposed to relationship property claims in the event of a relationship break up.
Family Protection Act: A Trust can protect assets from family protection claims by disgruntled family members who disagree with the provisions of a deceased person’s Will.
Protection in old age: Trusts can be structured to reduce the risk that an elderly person will lose family assets through a relationship breakdown, undue influence of other family members, or poor financial decision making.
Income spreading: Income earned by the Trust may be spread among one or more beneficiaries to take advantage of their lower tax rates.
Is a Trust still your best method of asset protection? If you haven’t reviewed your Trust for a while, now is the time to do so. New legislation means new obligations and increased administration costs. Your Trust must now be compliant with the new legislation. Make sure your Trust is up to date, compliant, and relevant for your current circumstances.
This article is of a general nature only and is not intended to constitute specific advice. Need help to determine if your Trust is relevant and compliant? Contact us for more information about our Trust Review service
All the best for the financial year 2022/23,
The PKF Dunedin Team
We're here to help you develop, improve and grow your business, so let us know how we can assist you.
PKF Dunedin Ltd, PO Box 5110, Dunedin, 9054 Tel. 03 474 0475 firstname.lastname@example.org