Menu

 Welcome to the Five Peaks blog

Parental Leave

PARENTAL LEAVE PUTS AN ONUS ON EMPLOYERS

Prime Minister Jacinda Ardern probably won't take 18 weeks paid parental leave when she has her baby this autumn, but New Zealand law says she's entitled to it.

Staff who've worked for you or any other employer for an average of at least 10 hours a week for any 26 weeks of the year preceding the birth or assumption of care of a child can take paid parental leave so long as they are the primary carer of the child and take leave to care for the child.

Whether that staff member can take extended leave without pay will depend on whether they have been employed with you for an average of 10 hours a week for the previous six months. If so, they can take six months' leave (in total, i.e. including primary carer leave). If they've met these criteria for a full year, their total leave is one year. 

If employees give the right notice for the right parental-leave reason, you have to keep their jobs open until they return to work. If they're taking more than four weeks' parental leave, you have to keep their jobs open, unless those jobs are defined as key positions or there's redundancy.

If any of those jobs are key positions, or there's redundancy, affected staff go into a 26 week "period of preference" at the end of parental leave. That means that if any time during those 26 weeks you have a job that's similar to what they were doing, you have to offer it to them first.

A job may be a key position because it needs special skills and there aren't enough people with those skills. Or it would take too long to train or find a temp to do the job. Affected staff can disagree that their jobs are key positions.

There are rules around communication regarding employee applications for parental leave and employer responses, and whether or not the employee is going to return to work. We can help you avoid stepping on any landmines here.

It takes guts to start a business. But to succeed also takes a strategic mindset.

What does that mean, exactly, and how would you know if you're thinking strategically enough or not? One way is to imagine you're about to put your business on the market. What would a potential buyer hope to see in your business? What would you add or take away to make it more attractive?

We recently interviewed Rob Young, whose company Platform 1 works with business owners on ensuring they get the best possible return when selling their business. Rob's insights into how to think strategically may surprise you. His advice is simple, clear and easily within reach of anyone committed to creating a successful business.

Here's an abridged transcript of the interview. For a full transcript, click here. Listen to the interview here.

Avoid the year end migrane

BE A GOOD SCOUT TO AVOID

END-OF-YEAR MIGRAINE

Being prepared is the key to avoiding end-of-year financial drama and stress.

  1. First make sure you have all the documents we'll need, such as PAYE statements, bank statements showing interest earned, dividend statements for shares, and receipts for expenses. Don't forget receipts for charitable donations.

  2. Look at writing off old debts. Scrap redundant or worthless assets, so you get a deduction on your books.

  3. Print out profit and loss, balance sheet and general ledger listing reports and store them safely.

  4. Have a final look at your payroll reports. You don't have to give summaries to your staff, but if you give them Earning Certificates, they can be used to check IRD information.

  5. Note odometer readings on vehicles and ensure logbooks noting business and personal use, mileage and costs etc. are in order.

  6. Dispose of obsolete stock by the year end or write it down to its net realisable value.

  7. Talk to us on any planned dividend payments, as managing imputation credits will be important.

  8. Finally, get us to work with you on reviewing your business plan and updating it for next year – and to review your accounting software.

Parental leave puts an onus on employers

Prime Minister Jacinda Ardern probably won't take 18 weeks' paid parental leave when she has her baby this autumn, but New Zealand law says she's entitled to it.

Staff who've worked for you or any other employer for an average of at least 10 hours a week for any 26 weeks of the year preceding the birth or assumption of care of a child can take paid parental leave so long as they are the primary carer of the child and take leave to care for the child.

Whether that staff member can take extended leave without pay will depend on whether they have been employed with you for an average of 10 hours a week for the previous six months. If so, they can take six months' leave (in total, i.e. including primary carer leave). If they've met these criteria for a full year, their total leave is one year.

If employees give the right notice for the right parental-leave reason, you have to keep their jobs open until they return to work. If they're taking more than four weeks' parental leave, you have to keep their jobs open, unless those jobs are defined as key positions or there's redundancy.

If any of those jobs are key positions, or there's redundancy, affected staff go into a 26 week "period of preference" at the end of parental leave. That means that if any time during those 26 weeks you have a job that's similar to what they were doing, you have to offer it to them first.

A job may be a key position because it needs special skills and there aren't enough people with those skills. Or it would take too long to train or find a temp to do the job. Affected staff can disagree that their jobs are key positions.

There are rules around communication regarding employee applications for parental leave and employer responses, and whether or not the employee is going to return to work. We can help you avoid stepping on any landmines here.

Bright Line test changes

SAFE AS HOUSES: STOP PRESS!

Revenue Minister Stuart Nash has confirmed the bright-line test on residential property sales will be extended from two years to five years. At present, income tax must be paid on any gains from residential property sold within two years of acquisition, with some exceptions (such as the family home). The extension means that profits from residential investment properties bought and sold within five years will generally be taxable.

To make this happen, changes to law are currently making their way through Parliament. It is expected these will receive Royal Assent in March. And it is expected that this will affect properties acquired on or after the date of Royal Assent.

We will have more for you on this when the legislation passes. Meanwhile, if you are in the process of entering into sale and purchase agreements to acquire property, please give priority to discussing the tax implications with us. 



The end of the financial year can be either stressful or a seamless part of what you do. Ideally, your end-of-year accounts will confirm what you think your business has been doing for the past 12 months.

Be a good Scout to avoid end-of-year migraine

Being prepared is the key to avoiding end-of-year financial drama and stress.

  • First make sure you have all the documents we'll need, such as PAYE statements, bank statements showing interest earned, dividend statements for shares, and receipts for expenses.
  • Don't forget receipts for charitable donations.
  • Look at writing off old debts. Scrap redundant or worthless assets, so you get a deduction on your books.
  • Print out profit and loss, balance sheet and general ledger listing reports and store them safely.
  • Have a final look at your payroll reports. You don't have to give summaries to your staff, but if you give them Earning Certificates, they can be used to check IRD information.
  • Note odometer readings on vehicles and ensure logbooks noting business and personal use, mileage and costs etc. are in order.
  • Dispose of obsolete stock by the year end or write it down to its net realisable value.
  • Talk to us on any planned dividend payments, as managing imputation credits will be important.
  • Finally, get us to work with you on reviewing your business plan and updating it for next year – and to review your accounting software.

We'll probably adjust your reports or accounts. Once we're done, lock all accounts relating to the financial year – and keep them secure

Safe as houses: Stop Press!

Revenue Minister Stuart Nash has confirmed the bright-line test on residential property sales will be extended from two years to five years. At present, income tax must be paid on any gains from residential property sold within two years of acquisition, with some exceptions (such as the family home). The extension means that profits from residential investment properties bought and sold within five years will generally be taxable.

To make this happen, changes to law are currently making their way through Parliament. It is expected these will receive Royal Assent in March. And it is expected that this will affect properties acquired on or after the date of Royal Assent.

We will have more for you on this when the legislation passes. Meanwhile, if you are in the process of entering into sales and purchase agreements to acquire property, please give priority to discussing the tax implications with us.

Money laundering is big business in New Zealand. Every year $1.35 billion of fraud- and drug -related money is laundered through seemingly legitimate businesses. In response, the Government introduced specific Anti-Money Laundering and Countering Financing of Terrorism legislation to address this risk.

Previously, only a few types of organisation had to comply with the legislation. Following amendments to this legislation passed last year, it is now confirmed that this legislation extends to these groups taking effect from these dates (or earlier if the Government legislates by an Order in Council):

  • 1 July 2018: lawyers, conveyancers and businesses that provide trust and company services
  • 1 October 2018: accountants who provide particular kinds of business services
  • 1 January 2019: real estate agents
  • 1 August 2019: businesses trading in high-value goods, sports and racing betting.

If you are in any of these categories, of course you must make sure that your business complies. We can point you in the right direction. But please also note that as your accountant we are in one of the categories that must comply with the changes. And to do this, be aware that we will sometimes need to ask you for more information than we have in the past. This is because we need to be able to document that we have verified your ID and both you and your business entities are all above board.

November 2017 Newsletter

Click the link below to view the November Newsletter

November 2017 - Newsletter

September 2017 Newsletter

This months newsletter looks at Rental Properties, Airbnb and boarders.

Click here for the Five Peaks September 2017 Newsletter 

Xero and Reckon One

We support Xero and Reckon One and can help you from a distance when you need it, they are both cloud based which means you login over the internet similar to internet banking.

READ MORE

Partnering with you

Five peaks works with you to improve your areas of concern

Click here to complete your assessment

Agreed Pricing

We provide standard plans so you have certainty of pricing and if needed this can be customised.

READ MORE

Five Peaks Blog

Contact / Connect