The end of the 2018/2019 financial year is coming up fast. Now's the time to think about how to minimise tax, and plan for next year. Some things to think about.
Check the figures — Got access to your profit and loss information? Take the time now to have alook. Average the profit out over the last 11 months and annualise it or do some sums on what's yet to invoice. Work out what your profit and tax might be for the year and see how much extra you might need to save to meet your obligations.
A tax calculator is on the IRD website to help you with the tax calculation.
If you cannot review your numbers or are using an accounting program called Excel then make a plan to kick into a real accounting system for April 1. Get advice on which one is best for you.
Plan for the next year — Put a budget in place and make sure you work on the "front end". I refer to this as how to make sales, working on how you charge and being clear on your price points.
Controlling and driving expenses is useful but sometimes we can lose sight of making money on the front end by focusing on expenses too much. Think about what tasks you can delegate — hire or outsource. Do you need funding and does the bank need to be in on your plan?
Tax minimisation — Your accountant will send out an end of year questionnaire soon, for the most part they are now electronic and smart. Make sure you complete them, if you don't understand it. These are not only designed to get the information they need but also are designed to ask questions to make sure that you have claimed those things which you are within your rights to.
Some of the suggestions your accountant may have may be along the lines of deferring invoices to clients until after March 31, selling/liquidating old stock, writing off assets in the asset register, writing off old debt unlikely to be collected.
