How a Tax Agent Can Reduce Your Tax Compliance Costs
For the most part small business and rental property owners don’t have the time, expertise or inclination to look after their own tax compliance. The usual solution is to employ the services of an Accountant or Tax Agent to take care of these matters. The main reasons for doing so are to…
Reduce the amount of tax to pay and to ensure correct taxation
Ensure everything is done correctly i.e. proper tax compliance
To gain an accurate picture of how things are going with their trading.
Many people are switching to a Tax Agent such as Kiwitax.
Tax Agents are a viable alternative to using a Chartered Accountant, especially if your tax affairs are reasonably straight forward. Members of ATAINZ the Accountants & Tax Agents’ Institute of New Zealand are required to ensure high ethical standards and maintain continuing education. For small business and rental property owners an ATAINZ Tax Agent can be a significant cost saver while ensuring the accounting and tax work is of a high standard. Kiwitax senior team members are full ATAINZ members.
Kiwitax accounting and tax services simply cost less…
When compared to many accountant’s fees Kiwitax pricing is quite a bit fairer. It’s not that we’re trying to be a “low cost solution” but there is definitely a price advantage in choosing a Tax Agent. Here’s how we achieve this at Kiwitax…
Efficiency – We are geared towards doing accounting and tax work in an accurate, time effective manner.
Fairness – We avoid a bloated hierarchy of managers and partners expecting big salaries.
Lower Overheads – We run a reasonably tight ship to keep costs in check. Glass towers? No.
Dedication – Being a small business we absolutely care about looking after every client, doing every job properly.
Focus – As Tax Agents we’re laser beamed on accounting and tax returns. It’s what we do and we’re good at it!
These key items result in a cost effective accounting and tax compliance solution for New Zealand small business and rental property owners.
What kind of savings are possible?
Here’s some examples of clients who have recently changed to Kiwitax and the savings they are making…
Trading Company (approx $400K turnover) – Wairoa – Now Saving 50.94%
A Wairoa based company was having 2 monthly GST returns prepared, company annual financials, company income tax and shareholder’s income tax returns prepared. They were paying $4861 pa with a large Chartered Accountant’s firm. Now for the same services their total annual spend is now $2385 pa with Kiwitax. A huge saving of $2476 pa and very happy clients!
Trading Company (approx $120K turnover) – Wairoa – Now Saving 47.93%
Another Wairoa company were having 2 monthly GST returns prepared, company annual financials, company income tax and shareholder’s income tax returns prepared. This business was paying $3880 pa with a Chartered Accountant now paying $1760 pa, saving $1620 pa with Kiwitax.
Trading Company (approx $180K turnover) – Auckland – Now Saving 63.99%
An Auckland based company were having annual financials accounts prepared, company and 4 shareholder’s tax returns. They were paying $3360 pa and this dropped to $1210 pa with Kiwitax – this is a huge saving of $2150 pa.
Trading Partnership (approx $730K turnover) – Gisborne – Now Saving 46.30%
A Gisborne based partnership were having their partnership annual financials, partnership and 2 partner’s income tax returns prepared along with 2 monthly GST returns prepared. Their annual spend had reached $4199 pa. Once changing to Kiwitax their annual tax compliance costs have reduced to $2255 pa with Kiwitax, saving $1944 pa. Again we’ve received favourable comments regarding improved level of service.
Rental Property Partnership – Auckland – Now Saving 56.71%
An Auckland rental property owning partnership were having their rental property reports prepared, partnership and 2 owners income tax returns. They were paying an Accountant $1178 now paying $510 with Kiwitax to prepare their work. Another significant saving of $688 pa.
Rental Property – Partnership – Hawkes Bay – Now Saving 58.62%
A local Hawkes Bay rental property owning partnership were getting their rental property reports prepared, partnership and 2 owners income tax returns – they were paying $1462 now this has reduced to $605 with Kiwitax. Again another excellent saving of $857 pa for exactly the same services.
How best to decide if a Tax Agent is right for you
It depends on exactly what’s required. If there’s simply a need to meet tax compliance obligations then a Tax Agent is an excellent choice. If you’re looking for lots of business planning and growth advice a Chartered Accountant may be a better fit. At Kiwitax we recommend people use the services of a business advisor when help is required while we look after the tax compliance work. This arrangement can really be a win-win situation especially with many Accountants moving away from compliance work and focusing on an advisory role.
Changing to a Tax Agent
Many people believe it’s too hard to change away from their Accountant. Often people think their Accountant knows their business too well or fear feathers may be ruffled. The reality is most accountants, although not wanting to lose clients, are happy for a business owner to do the right thing for their business. There’s no need to burn bridges and you’re always welcome to consult your Accountant for business advice. All you’re doing is having a Tax Agent look after the tax compliance work and probably saving a fair amount in the process. The fact is using a Tax Agent can make good business sense.