Graphs and charts from the Budget 2008
Video: Dr Cullen explains changes for businessKEY POINTS:
A number of changes to business tax filing and accounting rules have been announced in a joint Budget statement from Finance Minister Michael Cullen and Revenue Minister Peter Dunne.
"Compliance costs will be reduced by raising a number of tax thresholds," they say. "That may mean fewer tax returns for businesses to complete, a reduction in the amount of information or number of calculations required to complete returns, and a reduction in the number of tax payment that must be made."
These changes, said Cullen and Dunne, represented the first phase of the governments' review of measures to reduce tax compliance costs for businesses.
"The second phase will consider initiatives that represent more significant departures from the normal tax rules that businesses have identified in consultation as being desirable," say the Ministers.
The main threshold changes announced include:
- The PAYE once-a-month filing and payment threshold will be raised from $100,000 to $250,000. That, says the Government will also more Small and Medium sized Enterprises (SME) employers to file and pay PAYE deductions once a month instead of twice a month.
- The fringe benefit tax (FBT) annual return filing threshold will be raised from $100,00 to $250,000. Annual filing will also be available for "closely held" companies if their FBT liability arises solely from the provision of up tot two vehicles to shareholder - employees. The changes will increase the number of employers that can file and pay the tax annually rather than quarterly.
- The GST registration threshold will be raised from $40,000 to $50,000, which will mean fewer taxpayers will have to register for GST.
- The GST six-monthly return filing threshold will be raised from $250,000 to $500,000, which will allow more taxpayers to file returns on a six-monthly basis rather than a two-monthly basis.
Cullen and Dunne said the bill would introduce other threshold changes in relation to provisional tax, low-value trading stock and "accounting for tax in respect of financial arrangements."
- NZ HERALD STAFF
