Visionary Tax Planners Limited

1446 Words 6 Pages
Thank you for approaching Visionary Tax Planners Limited for advice to set up a self-guided walking and hiking tour business called Kauri Hikes together with bed and breakfast accommodation (Kauri BnB) for their short stay guests. However, it is really important to remember that undertaking this suggestion does not preclude you from going down to a particular path, rather it will only assist you to make informed decisions about if the option is likely to go furthest towards satisfying your interests. There are various structures for businesses; however, we would recommend adopting a company structure for both businesses.

It is really important to understand what is a company, so a “company is defined in s YA 1 as, a body corporate or other
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They need to follow ACC safety rules.
R&G need to consider external factors such as location of the business, economy and weather. Favourable weather ensures maximum number of days available for business in a year and good location will attract maximum number of customers for business.
They need to design a really good, attractive and user-friendly website for their new business because people like to research on internet before planning and investing. Upgrading website regularly to attract people is ongoing procedure which they need to keep in mind.
Internal factors for both the businesses are also important, such as hiring of suitable staff according to requirement. They need to employ trained instructors for the hiking business and experienced staff for making breakfasts, cleaning rooms and checking people out.
GST Registration
R&G is carrying out a taxable activity in New Zealand and if exceeds the turnover threshold of $60,000 need to be GST registered, also if,
• expected to go > $60,000 for the next twelve
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The dividends are taxed at the shareholders’ tax rates, with a credit allowed to the shareholder for tax already paid by the company on the profits.

Income distributed from the company as dividends can be distributed by the trust to beneficiaries, enabling the use of the beneficiaries’ marginal tax rates rather than the trust’s 33c/$ tax rate. Note that the minor beneficiary rule does limit the use of this strategy as a tax planning tool.

Sale of the business to a new owner
If R&G consider selling business to a new owner then the buyer will buy only those assets and liabilities as per their choice. Also estimate goodwill of the business and its valuation may be required. Moreover, capital gains/losses from the sale of the business can’t be transferred to Richie and Gemma until both businesses are wound up.

Sale of the shares in both businesses to a new owner
- Use of imputation credits and losses will be affected if there is a major change in shareholder continuity.
- Before the sale of shares dividend should be distributed to clear out imputation credits.
- New shareholders might ask to disclose the contingent liabilities of the

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