Getting paid on time

Securing timely payments is essential for maintaining a healthy cash flow. Whether you’re a contractor, sole trader, or business owner, here’s how to ensure the money you’re owed keeps coming in.

When a customer doesn’t pay an invoice, you end up financing the work until it’s settled. This can be especially costly if you’ve already paid for materials or staff. Sending invoices and following up with customers is a critical part of doing business.

Creating an Effective Invoice

A well-structured invoice is the first step to getting paid on time. Make sure every invoice you send includes the following:

Your business name.
The customer’s name and address.
The invoice number, issue date, and due date.
A clear, detailed description of the goods or services provided (e.g., date, quantity, rate, and hours).
The total amount due.
Your payment details, such as your bank account or credit card payment options.
Any buyer’s reference numbers, like a purchase order number, if requested.

Since April 1, 2023, the requirement to use a traditional “tax invoice” has been replaced with a more general requirement for taxable supply information. This new rule sets the minimum records you need to support your GST returns. The way you calculate GST hasn’t changed—only the rules for invoicing and record-keeping have. You only need to provide taxable supply information for supplies worth more than $200, but it’s a good practice to keep these records for all transactions.

Promptly Sending Invoices

Don’t wait. Send your invoice as soon as the job is complete while it’s still fresh in your customer’s mind. Think about the quickest way to get the invoice to them, whether it’s through a mobile EFTPOS machine in person or electronically using accounting software.

For business-to-business transactions, consider using eInvoicing. This technology sends invoice information directly between the buyer’s and supplier’s financial systems, even if they use different software. This improves accuracy, enhances security, and speeds up the entire payment process. Many invoicing platforms are already eInvoicing-enabled. You can find more information on how to get started at einvoicing.govt.nz.

Tips for Getting Paid on Time

Set expectations early. Discuss cost estimates and payment terms with your customer before you begin the work.
Confirm contact details. Make sure you have the correct contact information for the person responsible for paying the bill.
Be clear and detailed. Ensure your invoice clearly describes what was provided, when it was provided, the cost, due date, and payment terms.
Invoice immediately for small jobs. For a quick job, invoice as soon as the work is done. The longer you wait, the lower your invoice’s priority becomes.
Consider phased payments for long-term projects. If a project will take several months, consider breaking the total cost into smaller, milestone-based payments. This helps maintain cash flow and reduces your business’s risk.
Offer flexible payment options. Ask your customer if they have a preferred way to pay and offer multiple methods to make it easier for them.
Follow up. If the due date is approaching, a quick phone call or email can ensure your invoice doesn’t get forgotten.

What’s one thing you could do today to improve your invoicing process?

What type of Accountant to choose (ATAINZ) OR (CA ANZ)

In New Zealand, Chartered Accountants (CA ANZ) and accountants who are members of ATAINZ (Accountants and Tax Agents Institute of New Zealand) both work in accounting and tax, but they differ significantly in terms of qualifications, recognition, and the scope of work they can do.

Here’s a breakdown of the key differences:

🧑‍🎓 Qualifications & Professional Recognition

Feature	Chartered Accountant (CA ANZ)	ATAINZ Member (Accountant)
Professional Body	Chartered Accountants Australia and New Zealand (CA ANZ)	Accountants and Tax Agents Institute of New Zealand (ATAINZ)
Qualification Level	Degree + Postgraduate + CA Program + practical experience	Varies (often diploma or certificate in accounting/tax)
Title	“Chartered Accountant (CA)” is a protected title	“Accountant” is not a protected title
Global Recognition	High — internationally recognized (especially in Commonwealth countries)	Limited — mostly domestic recognition within NZ

📋 Scope of Work & Services

Area	CA ANZ	ATAINZ
Audits	Can conduct statutory audits (if also a Licensed Auditor)	Cannot conduct statutory audits
Tax Returns & Compliance	Yes	Yes
Business Advisory & Financial Reporting	Yes	Yes
Complex Financial Services	More likely to be qualified and insured for high-risk advice	May offer, but depends on individual qualifications

✅ Regulation & Oversight

Feature	CA ANZ	ATAINZ
Regulated Profession	Yes, with strict continuing professional development (CPD) and ethical standards	Yes, but less stringent than CA ANZ
Disciplinary Process	Robust disciplinary system with public accountability	Has standards and discipline processes, but less formalized
Public Practice Certificate	Required for offering services to the public (after extra training)	Not required, though ATAINZ encourages professional conduct

💼 Client Perception & Roles

Feature	CA ANZ	ATAINZ
Perception	Often seen as higher-tier professionals (especially in corporate or large businesses)	Common in small businesses, sole traders, and SMEs
Cost of Services	Generally higher due to extensive training and professional insurance	Often more affordable for basic accounting/tax services
Client Base	Large corporations, high-net-worth individuals, complex entities	SMEs, contractors, sole traders, small trusts

Summary:

Chartered Accountants (CA ANZ) are highly qualified, internationally recognized, and suited for complex accounting, auditing, and advisory services.
ATAINZ members are more focused on tax and small business accounting and may have practical experience but do not hold the same formal qualifications or global recognition as CAs.

Pilot for new tax debt service

Inland Revenue (IR) is trialling a new service to contact and help customers manage debt.

The pilot will see IR’s current third-party provider contact about three thousand customers who have a tax debt of less than $5,000.

Why do this pilot?

Spokesperson Jane Elley says there are a significant number of people with simple, low-value tax debt who IR isn’t able to contact one-to-one without the help of a third-party provider.

“We want to try to stop penalties and interest piling up on people and we also want to continue to find cost-effective ways to collect tax from those who owe it. We want to know if using a third-party provider is an efficient and effective way to support customers get their debt sorted,” Jane Elley says.

“We’ve worked successfully with Baycorp for a number of years collecting student loans overseas – that’s why we’ve selected them for this pilot. We’ve carefully considered the privacy concerns in Baycorp undertaking this work, and we’ve wrapped appropriate security and legal protections around it.

“We’re confident in the steps they have in place to protect taxpayer privacy.

“They will contact customers (email, SMS, and phone), confirm the debt, and promote IR’s self-service options, taking the customer through these steps. Where self-service is not enough, customers will be referred to Inland Revenue.

Concern about scam messages and calls

Many people are worried about scam calls and concerned about online security.

“If someone is worried about the authenticity of the caller, they can call Inland Revenue on 0800 775 247 to confirm. there is also information online Baycorp pilot programme.

“When contact is made, Baycorp won’t ask people to click on a link to get to their accounts. There’ll be no asking for credit card or bank account details; no threatening sudden arrest or pressure anyone to act immediately; and no asking for passwords.”

What information is being shared with the third-party provider?

Inland Revenue will only be supplying the information to enable conversations around payment resolution.

They are:
• Full Name
• DOB
• Contact Details including phone number, email, and physical address
• Specific Tax Type and amount of outstanding debt
• Last Contact date with customer
• Last payment date and amount and how this was made (no account details provided)

All third-party staff who work on Inland Revenue specific work must sign a certificate of confidentiality. The debt always remains with Inland Revenue and Baycorp cannot use the information it receives from us for credit rating purposes. Payment for this work is a fixed fee per case, regardless of contacts or outcome.

The pilot starts today and runs for 5 months.

Fifth anniversary of the SBC loans – time to repay

Today (May 12) marks the fifth anniversary of the Small Business Cashflow (Loan) Scheme, and the point where loans should be paid off.

The loan was made available to business owners from 12 May 2020 to help small to medium businesses affected by the COVID-19 pandemic.

More than 129,000 businesses were issued loans totalling $2.4 billion. The average amount approved was $17,000.

Most loans were taken out in the first few months of the scheme (May and June of 2020), with a 5-year repayment period. Many are now reaching their cut off point.

From next month, Inland Revenue will default a loan if it has not been paid off. Default interest (calculated based on use of money interest of 10.88% plus standard interest rate of 3%) will be charged.

As of 30 April 2025, 64,000 people had repaid their loan in full, with a total loan balance of $853 million still owing. Approx 14,300 customer’s loans are in default, owing just over $242 million. IR is actively taking steps to recover these defaulted loans.

IR is also alerting customers who are behind on their repayment plan and remind them that repayment is needed.

Since February this year we’ve tried to contact more than 1,500 customers who have defaulted loans and tax debt. As a result, we’ve recovered almost $10 million of SBC and tax debt from these customers.

Almost 20% have entered into an arrangement to pay the debt; 30% had a deduction notice placed on their debt to collect it directly from their bank account and 33% have made lump sum payments.

We are also reiterating that there are consequences, such as default interest being added to the balance and legal action, if the loan remains unpaid.

Customers can also check their loan balance, repayment plan and make payments in their myIR.

For any changes to a repayment plan or any changes in circumstances, customers can also contact IR through the secure channel in their myIR account to discuss options.

Budget 2025

1	A new tax incentive – Investment Boost – to encourage business investment that lifts wages and grows the economy.
2	Additional investment in health, education, law and order, and other frontline public services.
3	KiwiSaver changes to support Kiwis to save more for their first home and retirement, and to make the scheme more fiscally sustainable.
4	Funding to boost Defence Force capability and respond to a more challenging global environment.
5	New infrastructure, including a $1 billion investment in hospitals and a more than $700 million investment in schools.
6	Targeted cost-of-living support for low- to middle-income families and other groups.

The Government’s Budget for 2025 includes these proposed measures:

introducing a tax deferral regime for Employee Share Schemes
introducing Investment Boost, which supports businesses with an immediate tax deduction when purchasing new assets
increasing the Working for Families abatement threshold and abatement rate, and extending income testing to the first year of Best Start
making changes to KiwiSaver, including extending eligibility for Government and employer contributions to 16 and 17 year olds, increasing the contribution rate, removing the government contribution for people earning over $180,000 per year and halving the government contribution rate.

The Government has also launched consultation on proposals to:

improve Working for Families
reform the thin capitalisation rules to support infrastructure investment.

More information about these measures is available on the Budget website.

www.budget.govt.nz

Should I have a Family Trust?

Should I have a Family Trust?

The words “Family Trust” can evoke all sorts of images; especially for those not familiar with them, but they are a valuable tool for many New Zealanders when it comes to asset protection, tax planning and inheritance/estate planning. Having a family trust can be stressful if not done correctly or planned properly from the beginning, however there are good reasons why family trusts are so popular with kiwis.

Official estimates are that there could be as many as half a million trusts in New Zealand. Many of these will own the family home, maybe a few investments but not much more.

While the advantages of having a family trust out-weigh the disadvantages, they are not a “magic bullet” or “cure-all”. There are disadvantages in having a family trust that are important to know.

Disadvantages of a Family Trust

1. Legal compliance – a trust is a separate legal “person”. This means that there is paperwork and legal requirements that must be met.

2. Cost – there are fees to set a trust up and, in most cases, annual fees for the ongoing costs of managing the trust.

3. Complexity – a trust adds a layer of complexity to things that was not there beforehand. “Normal” every-day decisions, such as buying or selling a house, will need to be properly documented and important documents signed by all the trustees (managers of the trust).

4. Time – with increased legal compliance and complexity, additional administration time will be required for trust related matters.

5. Loss of Ownership – once a trust owns your assets, such as the family home, you are no longer the legal owner. While this is one of the main purposes of a family trust, it can still be daunting to some people to realize that they no longer “legally” own their home.

Given these disadvantages, why do so many people still choose to have a family trust?

Because the Advantages can be worth it…

1. Protection of Personal Assets – if you have a business or provide personalized advice (such as an engineer), your personal assets (family home, rental properties, savings and investments) could be at risk from creditors or lawsuits against you. A family trust isolates you from your personal assets, protecting them from business or legal challenges.

2. Special Purpose – a family trust can be used to ensure that funds are set aside for matters important to you. This may be things such as the long-term care of a handicapped child or helping with the costs of a grandchild’s education.

3. Separating Assets from Relationship Property – whether from concerns of an ex-partner making a claim against your estate in the event of your death, a new relationship not lasting or protecting the inheritance money of children from their present (or future) spouses, a trust helps isolate inheritances from personal assets.

4. Residential Care Subsidies – if you require permanent rest home care when you retire, you may be eligible for a rest home care subsidy. Currently Work and Income (WINZ) tests the income and assets of recipients to determine their eligibility for this subsidy. When assets are transferred appropriately, and in a timely manner to a trust, these assets (and any income they generate) can be excluded from this calculation.

If you want to know more about family trusts, want to know if a family trust is suitable for your circumstances, or want help in initial planning for a family trust, contact us today. We are happy to help you.

Law changes for overseas investment in Kiwi businesses

If you are a New Zealand business seeking overseas investment, there are new requirements you’ll need to follow. Find out about the changes and what you need to do.

When: From16 June 2020

What: Changes have been made to rules that impact New Zealand businesses looking for overseas investment. The changes include:

a new requirement to notify the Overseas Investment Office (OIO) about overseas investments, and
a new national interest test that will apply to some investment transactions.

OIO will need to be notified about all overseas investments that will result in:

more than 25% of a New Zealand business or its assets being owned by investors outside of New Zealand, or
an increase to an existing holding beyond 50, 70 or to 100%.

A new national interest assessment will apply in rare circumstances to evaluate whether an overseas investment in sensitive and high-risk assets are in New Zealand’s national interests.

Changes also mean the application process for lower-risk investment transactions is simplified, and some transactions will no longer need consent.

Changes to the Overseas Investment Act (external link) — Overseas Investment Office

Who: New Zealand businesses seeking overseas investment.

Why: Overseas investment can support New Zealand’s COVID-19 economic recovery, so that businesses can continue to grow and evolve, and keep more New Zealanders in jobs. The right checks and balances are needed to protect businesses that are important to New Zealand’s national security, economy, and communities.

What you need to do: If you are seeking overseas investment, be aware of the changes to when the OIO needs to be notified, and that a new national interest assessment might apply to overseas investors wanting to invest in your business.

Businesses seeking investment should get advice from their advisors, for example a lawyer or accountant.

New measures targeting high-cost lenders, mobile traders take effect

New measures that protect consumers who borrow from high-cost lenders and mobile traders came into effect on 1 June 2020.

The measures are aimed at preventing predatory lending practices that trap vulnerable consumers in debt and include:

capping the interest and fees on high-cost loans to 0.8 per cent per day
requiring mobile traders to comply with responsible lending protections in the Credit Contracts and Consumer Finance Act.

These changes are part of wider improvements the Government is making to consumer credit law. Other changes relating to high-cost credit that came into effect on 1 May 2020 include limiting the total cost of credit to 100 per cent of the loan principal, banning compound interest, and limiting default fees to $30.

The Government is aiming to have further consumer credit reforms, including new affordability regulations and new requirements for lenders to meet fit and proper person thresholds, in place from 1 October 2021.

More information is available on MBIE’s review of consumer credit law.

Read the media release on the Beehive website(external link).

Inland Revenue warns of scams during tax refund process

Inland Revenue is warning customers to be wary of scammers during the 2020 tax refund season.

Between Mid-May and July, IR automatically processes and pays out tax refunds. It is also when scammers may try to scam you.

This year IR will send around 2.5 million automatically assessed tax refund notices during that time, using both customer’s myIR accounts and through the post. These will be sent out in daily batches, Monday to Friday, between mid-May and the end of July.

Scammers know this as well and target this time of the tax year to try to rip people off and gain access to bank accounts and other personal information.

Here’s what IR will and won’t do when we send out the tax assessment notices.

Inland Revenue absolutely will let people know if they have a refund by sending an income tax assessment.

We will only pay funds directly in to the bank account we have on record and we will ask people to log in to their myIR account from www.ird.govt.nz

We will ask for bank account details if we don’t have them but importantly, we will always ask people to provide these in a secure way – using their myIR account or through our call centre.

We will also give people until February next year to pay any bill. A bill won’t have to be paid immediately.

Inland Revenue will never put a dollar amount of a refund in an e-mail or txt message and will not ask for your credit or debit card details in order to pay a refund. We will also never ask you to reply to an e-mail or txt message to provide your bank account details.

IR will also never speak to customers threateningly.

Pay-as-you-earn provisional tax

New provisional tax option for small businesses

Small businesses that have turnover of less than $5 million a year can work out their provisional tax using the accounting income method (AIM).

AIM uses new functionality included in approved accounting software to work out payments. You can continue to use another provisional tax option if you think your business won’t suit AIM. It will suit your business if you have:

irregular or seasonal income
accounting software or want to start using accounting software.

Once you’ve opted in to AIM you’ll only pay provisional tax when your business makes a profit. This will help you to avoid cash flow problems.

As long as you make your payments in full and on time, there is no exposure to use-of-money interest. If your business makes a loss you can get your refund straightaway rather than waiting until the end of the year.

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