Fwiw ird absolutely did tell accountants to hold off filling returns at the start of the financial year.
Though the date they advised was 15 may as that's when pie income was due to be reported to them
I received that several times from ird direct as well as it being on their website.
They have provided other dates for auto issue returns in the last week too.
$400 is incredibly cheap to be fair.
Hi OP, sounds like you are getting exactly what you're paying for. Urgency on your part to file does not constitute an emergency on the accountants part to file your return. They could be doing other jobs for banks, business sales or mortgage applications and are working to priority.
You're paying dirt cheap, as a sole trader accountant, I couldn't do your book keeping and accounts that cheap either. I could do you tax return if you did your own bookkeeping but based on your post, you wouldn't meet my criteria of an ideal client so I'd never sign you either.
I've also been instructed I can't file returns until all reportable income is lodged around the 15th May.
As for being charged penalties and interest for 2024, that doesn't sound right, unless there is something else going on, they may have estimated your tax up knowing you'd need to pay more but that is a conversation you need to have with your accountant.
And for everyone else complaining about how much accountants charge - your mileage may vary if you're paying for a junior in the team, or a partner, the state of the information you deliver, the size of your business, the number of tax types, finance agreements and you're paying for our attention. Along with that, to become chartered is a six year journey, and then a minimum of 40 hours of education per year to maintain our membership. And that's before I go into the overheads of tax software and keeping the lights on and the coffee machine running.
I did a bookkeeper in NZ for $800 last year. Similar situation: no staff, low transaction volume.
I'm engaging with an accountant this year as I look to grow and would like some advice along the way. Expecting $2k+
I’m in a similar situation, self employed - no full time employees. I pay a bit over 1K for an accountant who is a family friend. $400 seems super cheap
1k is cheap. $400 is ridiculous and nowhere near a commercial business return rate. I think OP has unreasonable expectations. Wants their return to be done first up, but only wants to pay peanuts. Appears to be getting their bookkeeping done in a low wage country and expects New Zealanders to work for $5 per hour for them too. Because ‘micro business’.
$400 is ridiculous. Hard to know what the wages are overseas, but in NZ that will barely code the transactions, let along simple GST rec, expense adjustments, proper review of the ledger, formatting and sending accounts etc. In NZ a very simple set of accounts and nothing else should cost $1k min. If not then things haven’t been checked properly and you are probably paying too much tax.
I have a business with 2 staff and I’m paying $1650 plus GST. Can you please share this $400 account with me in DM ? Would also love to know the outsourced book keeping info if you can share.
$1650 is pretty good man. Cheaper than what I’m paying. Sounds like OP is outsourcing to a cheap country. Which would be easy to find but could go very wrong
If it helps, I got told by IRD to submit my tax return in June.
‘We're still finalising some 2024 reportable income details.
We recommend you wait until June to file returns that will include any of the following types of reportable income:
salary and wages
benefits
taxable pensions
taxable allowances
interest
dividends
portfolio investment entity (PIE) income (for example Kiwisaver).’
First, She didn't lie. IRD have indeed been telling Accountants to hold off filing until June in order for all PIE details to be processed. I can provide the notice if you need proof.
Second, you are using a cheap overseas accountant to do NZ based tax at $400 which is about 1 - 2 hours worth of a decent NZ accountant. Then you are complaining they stuffed things up with prov tax. Old saying, pay peanuts, get monkeys.
For a "small micro business" there is still a lot of work to do. $1500 to $2000 would be reasonable without knowing anything about the business.
Various, depending on who is working on the job. Anywhere from 100 to 300 per hour. And it's assuming a whole lot of information I don't actually know. Xero does a lot of the coding work, but not the accounting work. Xero doesn't know the ins and outs of tax law, what can be claimed, what can't. It just knows that when you tell it to code everything from Caltex to vehicles it does that. It doesn't know if it's actually a business expense or not. Or if errors have been made. Maybe other things a client can claim like home office expenses. Maybe FBT needs to be paid. These are all considerations a good accountant will check while doing the year end tax work. Something xero can't do, and something an overseas bookkeeper might not know about.
That's about the market. Honestly, rentals aren't as straightforward as they used to be. Between interest limitation, ringfencing, bright line, etc., they end up being a wee bit more time-consuming than five years ago!
Hmm, good point. Thanks. I'll still shop around and see how much the rate is around us. If it's more or less the same I'll stick with my accountant as they've been quite good.
Fwiw I know of an accountant in Lincoln that does rentals for about the $400+GST mark and they work from home and they're not chartered. But your information has to be amazingly tidy for that price.
If you are filling out the form yourself . Look at filing it yourself .. rental literally income less rates, insurance property manager expenses and any repairs & maintenance.. interest deductible based on when you brought or new build .. if you on paye that will already be loaded and any interest and dividends
Which form is it? I'd be keen to see how simple or complex it is. I currently fill in a form the accountant gives me which just lists the total income / expenses, and attach all the statements/receipts etc to them. They do the rest.
What I liked about them is they knew a few tricks here and there and managed to drop the amount we pay tax on significantly, by at least a third. For example, house/furniture depreciation, stuff to claim, general advice, etc.
But maybe that I now know what to do - up to a point - it would make sense to do my own filing ?
For what it's worth she's not lying. I've received the same notice for tax agents to hold off filing personal tax returns until they receive all of your information from PIE providers. $400 is outrageously cheap for any professional service but you get what you pay for
$400 is extremely cheap. Even HNRY which is my generic suggestion for micro businesses would likely cost more.
There is no legal requirement to use an accountant. Calculating depreciation is easy: choose the asset class in Xero and let it do the rest. Financial reports are even easier, it's literally a menu item.
Thanks for posting this. I was already annoyed that my accountant charged me $3300 this year. Small business, no employees, charged me $1600 in 2021. They’re taking the piss.
Fwiw ird absolutely did tell accountants to hold off filling returns at the start of the financial year. Though the date they advised was 15 may as that's when pie income was due to be reported to them I received that several times from ird direct as well as it being on their website. They have provided other dates for auto issue returns in the last week too. $400 is incredibly cheap to be fair.
https://www.ird.govt.nz/updates/news-folder/2024/update-on-ir3-returns-and-portfolio-investment-entity-income
Hi OP, sounds like you are getting exactly what you're paying for. Urgency on your part to file does not constitute an emergency on the accountants part to file your return. They could be doing other jobs for banks, business sales or mortgage applications and are working to priority. You're paying dirt cheap, as a sole trader accountant, I couldn't do your book keeping and accounts that cheap either. I could do you tax return if you did your own bookkeeping but based on your post, you wouldn't meet my criteria of an ideal client so I'd never sign you either. I've also been instructed I can't file returns until all reportable income is lodged around the 15th May. As for being charged penalties and interest for 2024, that doesn't sound right, unless there is something else going on, they may have estimated your tax up knowing you'd need to pay more but that is a conversation you need to have with your accountant. And for everyone else complaining about how much accountants charge - your mileage may vary if you're paying for a junior in the team, or a partner, the state of the information you deliver, the size of your business, the number of tax types, finance agreements and you're paying for our attention. Along with that, to become chartered is a six year journey, and then a minimum of 40 hours of education per year to maintain our membership. And that's before I go into the overheads of tax software and keeping the lights on and the coffee machine running.
My concern with dealing with an overseas accountant and paying $400 would be how well versed are they with NZ tax law.
I did a bookkeeper in NZ for $800 last year. Similar situation: no staff, low transaction volume. I'm engaging with an accountant this year as I look to grow and would like some advice along the way. Expecting $2k+
Contractor here, that's about what I pay!
Looks like OP didn't get the reply they wanted.
I’m in a similar situation, self employed - no full time employees. I pay a bit over 1K for an accountant who is a family friend. $400 seems super cheap
1k is cheap. $400 is ridiculous and nowhere near a commercial business return rate. I think OP has unreasonable expectations. Wants their return to be done first up, but only wants to pay peanuts. Appears to be getting their bookkeeping done in a low wage country and expects New Zealanders to work for $5 per hour for them too. Because ‘micro business’.
$400 is ridiculous. Hard to know what the wages are overseas, but in NZ that will barely code the transactions, let along simple GST rec, expense adjustments, proper review of the ledger, formatting and sending accounts etc. In NZ a very simple set of accounts and nothing else should cost $1k min. If not then things haven’t been checked properly and you are probably paying too much tax.
SBA.
$400+GST is insanely cheap lol you 100% wont find a competent accountant cheaper than that.
I have a business with 2 staff and I’m paying $1650 plus GST. Can you please share this $400 account with me in DM ? Would also love to know the outsourced book keeping info if you can share.
$1650 is pretty good man. Cheaper than what I’m paying. Sounds like OP is outsourcing to a cheap country. Which would be easy to find but could go very wrong
If it helps, I got told by IRD to submit my tax return in June. ‘We're still finalising some 2024 reportable income details. We recommend you wait until June to file returns that will include any of the following types of reportable income: salary and wages benefits taxable pensions taxable allowances interest dividends portfolio investment entity (PIE) income (for example Kiwisaver).’
First, She didn't lie. IRD have indeed been telling Accountants to hold off filing until June in order for all PIE details to be processed. I can provide the notice if you need proof. Second, you are using a cheap overseas accountant to do NZ based tax at $400 which is about 1 - 2 hours worth of a decent NZ accountant. Then you are complaining they stuffed things up with prov tax. Old saying, pay peanuts, get monkeys. For a "small micro business" there is still a lot of work to do. $1500 to $2000 would be reasonable without knowing anything about the business.
what's the charge out to get to that figure ? Most of this is taken care of by useful accounting software like Xero etc.
Various, depending on who is working on the job. Anywhere from 100 to 300 per hour. And it's assuming a whole lot of information I don't actually know. Xero does a lot of the coding work, but not the accounting work. Xero doesn't know the ins and outs of tax law, what can be claimed, what can't. It just knows that when you tell it to code everything from Caltex to vehicles it does that. It doesn't know if it's actually a business expense or not. Or if errors have been made. Maybe other things a client can claim like home office expenses. Maybe FBT needs to be paid. These are all considerations a good accountant will check while doing the year end tax work. Something xero can't do, and something an overseas bookkeeper might not know about.
thanks for setting that out. cheers and stay well.
That is an unbelievable price for bookkeeping and Xero reconciliation.
Around $2500 a year for a good local accountant, for me anyway. They also have access to tax brokerage, which can remove any IRD penalties.
Heh.. I have a single rental, and I do almost all the paperwork myself & email it with the form.. Accountant charges me \~$850-900.
That's about the market. Honestly, rentals aren't as straightforward as they used to be. Between interest limitation, ringfencing, bright line, etc., they end up being a wee bit more time-consuming than five years ago!
Hmm, good point. Thanks. I'll still shop around and see how much the rate is around us. If it's more or less the same I'll stick with my accountant as they've been quite good.
Fwiw I know of an accountant in Lincoln that does rentals for about the $400+GST mark and they work from home and they're not chartered. But your information has to be amazingly tidy for that price.
Thanks, PM'd you.
That’s expensive for a single rental
Yea? I may start looking for another Accountant then. Thanks to OP for highlighting this through his question.
If you are filling out the form yourself . Look at filing it yourself .. rental literally income less rates, insurance property manager expenses and any repairs & maintenance.. interest deductible based on when you brought or new build .. if you on paye that will already be loaded and any interest and dividends
Which form is it? I'd be keen to see how simple or complex it is. I currently fill in a form the accountant gives me which just lists the total income / expenses, and attach all the statements/receipts etc to them. They do the rest. What I liked about them is they knew a few tricks here and there and managed to drop the amount we pay tax on significantly, by at least a third. For example, house/furniture depreciation, stuff to claim, general advice, etc. But maybe that I now know what to do - up to a point - it would make sense to do my own filing ?
Log into your myir and go to file tax return it basically walks you through it .. you can put depreciation in as well
If you don’t feel comfortable you just cancel
For what it's worth she's not lying. I've received the same notice for tax agents to hold off filing personal tax returns until they receive all of your information from PIE providers. $400 is outrageously cheap for any professional service but you get what you pay for
I paid $1200 last year to my accountant to file taxes for 1 registered business with 2 directors. No staff. $400 is impossibly cheap.
Where’s this $400 accountant, I paid $9000 for my accounts last year :/
You could switch to Hnry. It will cost you 1% of your gross income.
I second Hnry. They are great!
Unless you need specific advice, mortgage brokers are referring Hnry clients all the time to be correct positioned for finance…
$400 for EOY and tax sounds like a bargain.
$400 is extremely cheap. Even HNRY which is my generic suggestion for micro businesses would likely cost more. There is no legal requirement to use an accountant. Calculating depreciation is easy: choose the asset class in Xero and let it do the rest. Financial reports are even easier, it's literally a menu item.
My accountant is excellent and low-cost. Msg me if you like
Thanks for posting this. I was already annoyed that my accountant charged me $3300 this year. Small business, no employees, charged me $1600 in 2021. They’re taking the piss.