Businesses can face a range of taxes including (most commonly) Income Tax, GST, Fringe Benefit Tax, PAYE, and Withholding Taxes.
It is important to identify the taxes applicable to your business and schedule their due dates.
A very common problem is for a business to overlook paying tax in its first year of business. When the catch up comes, it is often in the second tax year, so it is faced with the second year tax liability also. This tax double up can be terminal!
To avoid this, tax can be paid voluntarily to IRD, paid on the shareholders salary via PAYE, or saved in a separate bank account.
It is important to have an approximate idea of how the business profit/loss and GST can be calculated after business transactions have been processed using in-house, cloud software, or by your Accountant.
Taxes can be one of the larger costs of business and the most difficult to calculate. Deciding on who should process business transactions and calculate the tax should be made when the business starts.
You should choose an Accountant who you can communicate comfortably with, especially on complex matters. A proactive Accountant will bring to your attention, tax planning and minimise the amount of tax that needs to be paid.