Preparing for End of Financial Year

If your business has a 31 March balance date, then your end of financial year is approaching fast.

Make sure you are prepared by reviewing the following:

  • Debtors – are they all recoverable?  In order to get a tax deduction for bad debts, they must be written off before balance date.
  • Creditors – Make sure you have all unpaid invoices to hand and recorded into your accounting system.
  • If your business holds stock, carry out a stocktake on 31 March.  Stock is valued at the lower of cost price or net realisable value.  However, if your annual turnover is $1,300,000 or less, and your stock value is reasonably estimated to be less than $10,000 then no stocktake is required.
  • If you have a service business, review your work-in-progress at 31 March to ascertain a value.
  • Fixed Assets.  Review your prior years asset schedule and note any that have been sold or are obsolete.
  • Repairs & Maintenance expenditure is generally 100% tax deductible.  If there is any expenditure of this nature then it may be worthwhile doing before 31 March.
  • Low Value Assets.  Generally, minor assets that cost less than $500 are fully tax deductible in the year they are purchased, so now may be a good time to purchase that printer or office chair you’ve been holding out for.
  • Staff Leave Reports.  If you employ staff, make sure you have all leave reports from your payroll system.  Also, remember that IRD’s new Payday filing system is active from 1 April 2019, so make sure you’re prepared for this.

If you need assistance with your end-of-year processes, contact me and I can help.

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