We've collated a 13-point checklist to help you roll towards the end of the tax year.
1. Contracts
Have you invoiced retentions that don’t need to be paid until next year? If they are payable this tax year, they will be classed as taxable income for 2023-24. Unsure? Talk to us as your tax adviser.
2. Employee expenses and holiday pay
Holiday pay, bonuses, redundancy payments, and long service leave owed to employees can be claimed this year if you have committed to them at year-end and pay them within 63 days of the balance date.
Also, ensure holiday pay has been calculated correctly to avoid time-consuming revisions once the tax year is over. Find more information here or visit the Employment NZ website.
3. Credit notes
Take stock of credit notes issued to customers after the balance date. You may be able to apply them to the current tax year and reduce your taxable income.
4. Expenses
Find out if you can prepay expenses before March 31 for items such as stationery, postage, and courier charges to claim deductions sooner.
5. Debtors / Accounts Receivable
Before the end of March, review your debtors and make a list of any outstanding bad debts. Ensure your records show you’ve taken reasonable steps to recover bad debts. Bad debts written off before March 31 can often be claimed as a deduction.
6. Fixed assets
If you’re not using some of your assets, you may be able to write them off. Are there assets you need to dump before year end?
7. Tax losses (carryforward, offsets and subvention payments)
Set to make a loss in the current financial year or have tax losses from prior years? Talk to us as soon as possible about carryforwards, loss offset elections and subvention payments.
8. Discounts for prompt payment
If you’ve offered prompt payment discounts over the tax year and maintain a discount reserve, this might be deductible. Make sure you keep clear records about any discounts.
9. Repairs and maintenance
Thinking about doing repairs or maintenance? Get it done before the year-end to ensure you get your deductions sooner. Consider software development and improvement costs as part of this.
10. Dividends and imputation credits
Review your dividend payments for the year by March 31. Imputation credit accounts mustn’t have a debit at the year-end, or you could be hit with penalties.
Also, review deemed dividends (for example, overdrawn shareholder current accounts with no interest charged).
11. Inventory
Dispose of obsolete inventory by year-end or write it down to its net realisable value (the lesser of cost or market value).
If your inventory is worth less than $10,000 and your turnover is less than $1.3 million for the year, you won’t need to include stock movements for tax purposes.
12. FBT
Review all FBT items. Have you taken account of possible exemptions? The FBT March quarter return is the year’s last quarterly return and will most likely require a wash-up calculation.
13. Home Office ClaimÂ
If you are a company, you must have paid for your shareholder or directors' actual costs before year-end. So if you want to make a claim, this should be calculated and paid before the end of the year.