March Newsletter
- Sasha Curin
- Mar 31
- 4 min read
The End of the Financial Year is Here
As the end of the financial year draws near, now is the time to get ready for the changes coming your way on 1 April 2025. From ACC levy adjustments to tax rate changes, there are several updates that may impact you.
Dennis and Gino recently returned from the ATAINZ Accounting Conference, where they gained valuable insights, including an important reminder for company directors about their key responsibilities under the Companies Act 1993. They’ve summarised these essentials to ensure you stay on top of your governance duties.
We’ve also included a link to our latest blog, featuring an End of Financial Year PDF checklist to help guide you through the final steps of the year and set you up for a smooth transition into the new one.
Read on for the full details and make sure you’re prepared for the upcoming changes.
Reminder: Directors' Duties Under the Companies Act
We’d like to remind company directors of their key responsibilities under the Companies Act 1993, specifically sections 131 to 137, which outline the essential duties to ensure good governance and compliance.
Key Director Duties:
Section 131 - Duty to Act in Good Faith and in the Best Interests of the Company
Directors must act honestly and prioritise the best interests of the company over their own or others’ interests.
Section 132 - Duty to Exercise Powers for Proper Purposes
Directors must use their powers only for the purposes intended by the company’s constitution and the law.
Section 135 - Duty to Avoid Reckless Trading
Directors must avoid actions that could lead to substantial loss for creditors or the company itself. Reckless trading can result in personal liability.
Section 137 - Duty of Care, Diligence, and Skill
Directors must exercise reasonable care, diligence, and skill in their decision-making, considering the company’s circumstances, their position, and the nature of the decision.
The government plans to modernise the Companies Act 1993 to better align with current business practices. For full details, visit the New Zealand Legislation website.
Understanding these duties is good practice for effective company governance. If you have questions or need clarification, please get in touch.
Tax Changes Coming 1 April 2025
As the financial year comes to a close, it’s important to prepare for the upcoming tax changes that will take effect from 1 April 2025. Below are some key updates to be aware of:
1. Increase in ACC Earners’ Levy
Starting 1 April 2025, the ACC earners’ levy will increase from 1.60% to 1.67%, and the maximum earnings threshold will rise from $142,283 to $152,790. Higher-income earners will pay slightly more in ACC levies, so it’s essential to review your payroll systems to ensure accurate deductions. Learn more about the ACC Levy changes: Inland Revenue - ACC Earners' Levy
2. Reinstatement of Mortgage Interest Deductibility for Rental Property Owners
From 1 April 2025, mortgage interest deductibility will be fully reinstated for landlords. This means landlords can once again deduct 100% mortgage interest expenses from their taxable income. If you own rental properties, this could significantly impact your tax planning.
Find out more about Mortgage Interest Deductibility: Inland Revenue - Property Interest Rules
3. Changes to Income Tax Rate Thresholds (Effective 31 July 2024)
The personal income tax thresholds were updated from 31 July 2024. The revised composite rates for the income year ending 31 March 2025 are as follows:
• 10.5% applies to income up to $15,600 (previously $14,000)
• 17.5% applies from $15,601 to $53,500 (previously up to $48,000)
• 30% applies from $53,501 to $78,100 (previously up to $70,000)
Ensure your payroll systems are set to reflect these new rates for the 2024/2025 tax year and prepare for the new tax rates coming into effect 1 April 2025 to avoid any discrepancies with PAYE deductions.
More information on income tax rate changes: Inland Revenue - Personal Income Tax Rates
4. Changes to ESCT and FBT from 1 April 2025
As part of broader tax reforms, there will be new changes to the Employer Superannuation Contribution Tax (ESCT) and Fringe Benefit Tax (FBT) from 1 April 2025. These changes will affect how businesses calculate and report superannuation contributions and employee benefits. It’s essential to prepare your business to ensure compliance with these new rules.
Get ready for the new ESCT and FBT changes: Inland Revenue - ESCT and FBT Updates
13 Tactics for Winners: A Tip to Succeed
We’ve created a guide called “13 Tactics for Winners” to help you succeed in business and life. It’s packed with practical advice on setting goals, staying motivated, and overcoming challenges.
This month, we’re highlighting one tactic from the guide to get you started:
This Month's Tactic: Be Open to Opportunities
Success often comes from seeing what others miss. Every day brings more opportunities than we could develop in a lifetime - the key is being ready to spot them. Like the inventor of Velcro who noticed burrs sticking to their clothes, breakthrough ideas can come from everyday observations.
Ask yourself:
What customer problems could become opportunities?
Are you working in your business or on it?
We'll share another tactic next month to keep you inspired. If you'd like to explore all 13 tactics now, you can download the full guide below:
Follow Us on Facebook
Stay informed with the latest tax updates by liking and following us on Facebook. We regularly share Tax FAQs to help you understand tax and accounting information, and we provide reminders for important due dates.
Join our community today!
Important Upcoming Dates:
31st March
End of Financial Year
7th April
Terminal Tax Due
FBT Return Due
18th April
Public holiday - Good Friday
21st April
Public holiday - Easter Monday
Read Our Latest Blog:
Commentaires