Latest news with #Findex
Scoop
13-06-2025
- Automotive
- Scoop
New Ute Owners Warned Of Looming ‘Tax Grenade'
Farmers and tradies buying utes under the government's Investment Boost initiative may inadvertently end up owing thousands of dollars in fringe benefit taxes. Correction: This article has been updated to clarify the $21,060 figure was in taxable benefits, not necessarily the full amount of tax that would be owed; and that the IRD is still consulting on the proposal. Farmers and tradies buying utes under the government's Investment Boost initiative will be hit by a 'tax grenade' in the form of a fringe benefit tax (FBT), according to an expert. Findex tax advisory partner Craig Macalister said the repeal of a work-related vehicle FBT exemption for mixed private and business use committed to in the government's latest Budget will result in tax implications for people who use their utes for business. IRD was consulting on the proposed changes. Under the change, farmers with a mixed used farm ute costing $70,000 will be hit with an annual FBT bill of $6370, at the proposed 26 percent rate for petrol and diesel vehicles. 'Farmers are buying vehicles at Fieldays, looking forward to a reduced cost thanks to depreciation deductibility, but oblivious to the tax grenade coming their way in 12 months,' Macalister said. 'Worse still, any vehicle over $80,000 – such as a $75,000 ute with $6000 in extras – will be classified as 100 percent taxable, resulting in a staggering $21,060 in FBT per year in [taxable benefit].' A tax of about $10,000 or $13,000 could then apply. Macalister said consultation on the tax changes had not been given inadequate consideration, resulting in a policy that over-taxed essential business assets. 'In our view, the use of the current FBT exemption strikes the right balance for work-related vehicles. Scrapping it will hurt farmers and other industries reliant on utility vehicles,' he said. 'These utes are not perks or 'Remuera tractors' – they're essential tools for carrying equipment, personnel and of course dogs on and off the farm. 'Yet, the IRD seems locked in a paradigm that views any provided vehicle as a perk to be taxed, unless it's an emergency vehicle.'
Scoop
13-06-2025
- Automotive
- Scoop
New Ute Owners Warned Of Looming 'Tax Grenade'
Correction: This article has been updated to clarify the $21,060 figure was in taxable benefits, not necessarily the full amount of tax that would be owed; and that the IRD is still consulting on the proposal. Farmers and tradies buying utes under the government's Investment Boost initiative will be hit by a "tax grenade" in the form of a fringe benefit tax (FBT), according to an expert. Findex tax advisory partner Craig Macalister said the repeal of a work-related vehicle FBT exemption for mixed private and business use committed to in the government's latest Budget will result in tax implications for people who use their utes for business. IRD was consulting on the proposed changes. Under the change, farmers with a mixed used farm ute costing $70,000 will be hit with an annual FBT bill of $6370, at the proposed 26 percent rate for petrol and diesel vehicles. "Farmers are buying vehicles at Fieldays, looking forward to a reduced cost thanks to depreciation deductibility, but oblivious to the tax grenade coming their way in 12 months," Macalister said. "Worse still, any vehicle over $80,000 - such as a $75,000 ute with $6000 in extras - will be classified as 100 percent taxable, resulting in a staggering $21,060 in FBT per year in [taxable benefit]." A tax of about $10,000 or $13,000 could then apply. Macalister said consultation on the tax changes had not been given inadequate consideration, resulting in a policy that over-taxed essential business assets. "In our view, the use of the current FBT exemption strikes the right balance for work-related vehicles. Scrapping it will hurt farmers and other industries reliant on utility vehicles," he said. "These utes are not perks or 'Remuera tractors' - they're essential tools for carrying equipment, personnel and of course dogs on and off the farm. "Yet, the IRD seems locked in a paradigm that views any provided vehicle as a perk to be taxed, unless it's an emergency vehicle."
RNZ News
12-06-2025
- Automotive
- RNZ News
New ute owners warned of looming 'tax grenade'
Under the change, farmers with a mixed used farm ute costing $70,000 will be hit with an annual FBT bill of $6370. Photo: Sergio Rota/ Unsplash Farmers and tradies buying utes under the government's Investment Boost initiative will be hit by a "tax grenade" in the form of a fringe benefit tax (FBT), according to an expert. Findex tax advisory partner Craig Macalister said the repeal of a work-related vehicle FBT exemption for mixed private and business use in the government's latest Budget will result in tax implications for people who use their utes for business. Under the change, farmers with a mixed used farm ute costing $70,000 will be hit with an annual FBT bill of $6370, at the proposed 26 percent rate for petrol and diesel vehicles. "Farmers are buying vehicles at Fieldays, looking forward to a reduced cost thanks to depreciation deductibility, but oblivious to the tax grenade coming their way in 12 months," Macalister said. "Worse still, any vehicle over $80,000 - such as a $75,000 ute with $6000 in extras - will be classified as 100 percent taxable, resulting in a staggering $21,060 in FBT per year." Macalister said consultation on the tax changes had not been given inadequate consideration, resulting in a policy that over-taxed essential business assets. "In our view, the use of the current FBT exemption strikes the right balance for work-related vehicles. Scrapping it will hurt farmers and other industries reliant on utility vehicles," he said. "These utes are not perks or 'Remuera tractors' - they're essential tools for carrying equipment, personnel and of course dogs on and off the farm. "Yet, the IRD seems locked in a paradigm that views any provided vehicle as a perk to be taxed, unless it's an emergency vehicle." Sign up for Ngā Pitopito Kōrero, a daily newsletter curated by our editors and delivered straight to your inbox every weekday.
Otago Daily Times
25-05-2025
- Business
- Otago Daily Times
Investment Boost should improve business confidence
While the government has been focused in recent times on trying to reduce expenditure to balance the books, the announcement of the new Investment Boost in last week's Budget should help improve business confidence by bringing forward a tax deduction for businesses investing in productive assets. The Investment Boost will allow New Zealand businesses to elect to take a 20% upfront deduction for new capital assets bought for their business. These assets must be used or available for use for the first time on or after May 22, 2025. Businesses already committed to building new assets before this date may still be eligible, provided the asset meets the usage criteria. The Investment Boost will apply to the purchase of most assets that are depreciable for tax purposes such as machinery, equipment and vehicles. It will also apply to new commercial and industrial buildings even though normal depreciation for these assets is 0%. In addition, improvements to depreciable property will be eligible for the Investment Boost if the asset being improved is also eligible. An example of an eligible improvement would be significant strengthening of an industrial building used or available for use on or after May 22, 2025. Assets that will be excluded from the Investment Boost are assets that have previously been used in New Zealand, including land, trading stock, residential buildings (dwellings), fixed life intangible assets (such as patents and trademarks), and assets that are fully expensed under other rules (such as assets that cost less than $1000 that are fully deductible). For businesses currently claiming Research and Development tax credits, the good news is that the deduction will be an eligible expenditure. While opponents might see the Investment Boost as a tax break for businesses, we see this as a positive incentive for businesses to invest in productive assets to boost the economy. If the asset is a depreciable asset, then the taxpayer would have been able to depreciate the asset anyway. Introduction of the Investment Boost will simply allow the deduction to be brought forward while still allowing for the amount to be clawed back in the same way depreciation is if the asset is sold. While the devil will be in the details, we believe this is a positive move for businesses in New Zealand looking to retain funds and invest in their future, which is ultimately what NZ Inc needs. While the early deduction will benefit those taxpayers already committed to expenditure, the hope is that the Investment Boost will also give hesitant businesses nervous about spending sufficient encouragement to invest in new assets. • Jarod Chisholm is a tax advisory managing partner at Findex (NZ). The views and opinions expressed in this article are those of the author and do not necessarily reflect the thought or position of Findex.
Sydney Morning Herald
25-05-2025
- Business
- Sydney Morning Herald
Generation squeeze: Why Millennials should start preparing for retirement now
Real Money, a free weekly newsletter giving expert tips on how to save, invest and make the most of your money, is sent every Sunday. You're reading an excerpt − sign up to get the whole newsletter in your inbox. As a generation, Millennials cop a lot of flak. First from older generations – usually with some mumblings about avocado toast or work ethic – and recently from our younger Gen Z counterparts, who think we're cringe or whatever. As an official 'cusp' Millennial, I like to pretend none of this criticism applies to me, and that I'm not cringe at all but actually extremely cool and relatable. Plus, at least I actually know how to use a computer. But if we move past my delusions and into the world of facts, the truth is that Millennials are facing a serious problem. Dubbed the 'generational squeeze', a recent survey by financial advisory Findex found half of Millennial Australians believe they'll need to support their family members. One third believe they'll need to support their elderly parents, and one fifth say they'll have to support their children. Loading What's the problem? While the bank of mum and dad is renowned for handing out loans to children, Millennials could be the first generation that needs to support their offspring and their parents at the same time, a daunting prospect for a generation barely managing to afford the rent. Indeed, one in every five Millennials said they were not confident in their ability to support dependents in retirement. What you can do about it If you're in this boat, there are some things you can do now to prepare yourself:
