Tax advice: Queries from self employed

The following questions and answers were selected from the CCH Question and Answer Service. For further details about the service visit the CCH website or phone CCH on 0800 500 224.

Question: Can you please advise if earner premium and residual claims levies paid by a self-employed person are tax deductible and if both include GST?

Answer: The earner premium and the residual claims levy are tax deductible for the self-employed.

The premiums are deductible in the year in which they become due and payable. Both premiums include GST.

Question: Are trial periods still applicable under the Employment Relations Act?

Answer: You can still engage employees for a trial or probationary period under the Employment Relations Act.

You must specify the trial period in writing in the employment agreement.

However, the use of a trial period does not affect the law relating to unjustified dismissal.

You can terminate the employee's employment at the end of a trial period only if you have good reasons for doing so and if you follow a fair procedure. In other words, the dismissal must be substantively and procedurally fair.

Simply informing an employee that he or she has not performed as required and terminating employment by giving the notice specified in an agreement would not be regarded as justified.

During the trial period you must, at the very least: provide the necessary training/assistance for the employee to do the job properly; point out the where the employee is falling short of expectations; explain how the employee can improve; tell the employee of the likely consequences if he/she does not improve.

If you have a good reason for dismissing the employee at the end of the trial period - for example the employee cannot do the job despite being given all reasonable assistance and opportunity to improve - you must still hold a fair hearing before dismissal to ensure that it is procedurally fair.


CCH New Zealand