The focus of the Budget 2013 continues to support the Government’s initiative to return to a surplus position by 2014/2015. Here are a few key facts from Budget 2013:
- Changes to ACC will see a reduction in ACC costs of around 40% over the next two years. ACC currently adds another 1.7% to personal tax rates and are a substantial portion of annual motor vehicle registrations.
- The Government is cracking down on student loan borrowers. Overseas based borrowers will face fixed repayment obligations and higher repayment thresholds. Over 65’s are no longer eligible for student loans and there will be stricter limits for those over 40.
- Additional money is being given to Inland Revenue to further pursue property investment tax compliance. Remember that if you acquire property with the intention of disposing of that property, any profit derived from the disposal is taxable.
- Start-up companies making losses are now able to claim refunds for tax losses incurred from research and development.
- Six areas of specific business “black hole” expenditure will now be tax deductible:
- Legal and administration costs incurred in applying for a patent or plant variety rights
- Certain fixed-life resource consents grated under the Resource Management Act 1991
- Expenditure on abandoned resources consent applications
- Costs directly associated with the payment of dividends
- Annual fees for listing on a stock exchange
- Annual shareholder-meeting costs