Issue 45 April 2024 Archives - BDS Chartered Accountants

The government has announced an increase to the minimum wage that will kick in from April 1. The adult minimum wage will rise by $0.45 an hour, taking it up to $23.15 an hour. This will mean additional costs for many businesses.

Workplace Relations and Safety Minister Brooke van Velden said that “a cautious approach to the minimum wage is required this year” giving “our lowest paid workers more money in their pockets, without hindering job growth or imposing unreasonable costs on businesses”.

If your business has minimum wage employees:
talk to your payroll people to ensure wage changes have been made
adjust your budgets for the year
consider the impact on the rest of your financial plans
check whether existing employment agreements provide for overtime or allowances. If they do, consider the impact of the wage increases.

Give us a call if you’re unsure how to plan for the minimum wage adjustment.

April 1 marks a significant change in the GST tax treatment of mixed-use assets.

Taxpayers can claim 100% of GST for expenses relating to the income-earning use of a mixed-use asset, for example, the cost of advertising a holiday home online.

However, working out GST claims for expenses relating to both the income-earning and private use of the asset has been more difficult to establish.

In the past, a complex calculation has been needed to apportion GST expense claims relating to both income-earning and private use.

As of this month, GST calculations for mixed-use assets have been simplified. You no longer need to use the old method and general apportionment and adjustment rules will apply instead.

Remember, if you have a mixed-use asset, such as a boat, bach, or plane, please keep records on how and when it is used for business or private purposes.

If you’re unsure about these changes, give your adviser a call.

Do you rent out a bach on Airbnb or do some driving on Uber for extra income? Additional tax changes could affect you that need to know about.

From 1 January this year, platforms such as Uber and Airbnb will collect information from their users including sales income and IRD numbers, and will be required to share it with Inland Revenue and relevant overseas tax authorities by early 2025. The requirement applies to online marketplaces in the ‘sharing economy’ that connect service providers with customers (for example, the owner of a holiday home with short-term tenants, or a driver with riders).

As well as short term accommodation and ride-sharing services, this covers people who provide assets such as cars, caravans, parking, or storage space, personal services such as graphic design on platforms like Pocket Jobs, or who deliver food on apps like Delivereasy. It also covers trades people who provide services to customers through online platforms.

Additionally, from April, people who rent out their bach on Airbnb or Bookabach, drive for Uber or other ride-sharing platforms, or who deliver food and beverages through online platforms should be aware that their online marketplaces are required to collect and return GST of 15%. This applies whether the seller is GST-registered or not, though the rules work a bit differently for people who aren’t registered for GST.

What we need from you

If you provide services on an online marketplace, you’ll still need to declare all income in your tax return and keep records of income earned and expenses incurred. If you would like more information on how the GST rules will apply to you, please contact us.

Everyone is talking about the artificial intelligence chatbot ChatGPT, a new tool that can do just about anything, from generating letter templates to answering questions.

ChatGPT is a fantastic free tool for any business. Here are some ways it can help you — and what you shouldn’t do with it.

DO

Use it to check your emails and letters: Ready to send an important email to a new client or business partner? Use ChatGPT to create a draft template and check your finished content for spelling errors. Ask the chatbot to edit your email and find any mistakes.

Use it as a research tool: ChatGPT is the most powerful artificial brain the world has ever seen, so use it to your advantage by asking it questions. The chatbot should be able to help you with research in any field — just remember to double-check information as it can get things wrong.

Use it for brainstorming: AI is great at coming up with ideas (though not all of them are good!). If you’re struggling for inspiration for a new business venture, product or service, ask ChatGPT to come up with some suggestions. It should help get the ideas flowing.

DON’T

Rely on it completely: ChatGPT is an amazing technology, but it’s not flaw-proof. The AI can still get confused and provide false information. Don’t rely blindly on information from ChatGPT for your client or staff emails. Fact-check everything.

Don’t plagiarise: Don’t lose your brand voice and personal touch by copying and pasting content from ChatGPT. Also, remember that your competitors will have access to the same tool.

Don’t share sensitive information: Concerns have already been raised about potential copyright issues and how ChatGPT uses information. You shouldn’t share sensitive business information, personal data or confidential information with the chatbot.

It’s always a good idea to give new technology a try. Experiment with ChatGPT to see if it can help your business.