2017 Tax e-seminar Tax e-seminar. Seminar slides. E-Seminar slides

Transcription

1 2017 Tax e-seminar Seminar slides 2017 Tax e-seminar E-Seminar slides

2 Intro

3 What we ll cover in this e-seminar Recent tax changes and how they affect you Inland Revenue update CAANZ update MYOB software changes and enhancements Making the most of Portal FAQs from our Support desk

4 Before we begin

5 What products are we talking about? MYOB AO Classic Return Preparation Tax Management E-Filing MYOB AO Often referred to as the New AO Contains Tax Manager MYOB AE Tax Tracking Return Preparation E-Filing May include Tax Manager MYOB AE Hybrid Clients who use AE PM with AO Classic will use this shortcut alongside AO Classic Tax Returns May include Tax Manager

6 TAX CHANGES

7 Overview of Inland Revenue tax changes Changes to lodgement processes How client GST data is accessed Residential Land Withholding Tax (RLWT) Accounting Income Method for provisional tax (AIM) How to process a Financial statements summary (IR10)

8 Inland Revenue changes to GST Administration 7 th February 2017

9 Overview of Inland Revenue tax changes START (Simplified Tax and Revenue Technology) to replace FIRST (Future Inland Revenue System Technology) To replace all tax types Phase 1 looks at GST

10 Areas affected by the changes Tax Agents Web Service (TAWS) Also known as Account Lookup or Inland Revenue Data download E-File Tax Agents electronic filing system myir Online web portal for taxpayers and agents

11 Tax Agent Web Service (TAWS) AE Tax Tracking Inland Revenue GST information in AE Tax Tracking will still be visible but the information will no longer be updated AO Classic Account Lookup There should be no effect, as GST was not previously visible in AO Classic Tax Manager GST registration and period details will no longer be updated to Tax Manager by the IRD download GST Alert Suppressed GST data excluded from integrity check

12 E-File All normal E-File functionality will continue unchanged Send GST returns by E-File NOTE Correspondence can no longer be attached to E-File GST returns

13 The unauthenticated GST return service has been discontinued for periods from March 2017 onwards

14 Features of the new GST tab in myir Registration Initially, all staff previously registered with the agency through myir, can access any accounts linked for GST Privacy Practice administrator can block staff from accessing the Practice GST information this needs to be done for each employee Access Each employee with a login will have their own list of GST clients they can add or remove clients from those already linked for GST Maintenance The list of clients on each staff member s list can also be maintained by the administrator a bulk import facility is available

15 Implications for tax agents Agents can continue to submit GST returns via e-file from AO Classic GL or AE Tax Return System The unauthenticated GST return filing has been discontinued Agents can file GST returns for their clients through myir with their Agent s login GST information will no longer be updated through IRD data downloads (TAWS)

16 Residential Land Withholding Tax (RLWT)

17 Let s take a look at Key definitions When RLWT applies When RLWT will be deducted How much will be deducted How to account for this in MYOB Tax Software

18 What is residential land? The term used in the bright-line test to describe land: with a dwelling on it, or a dwelling can be built on it under the local council's planning rules NOTE Residential land does not include land that is mainly used for business or farmland

19 Offshore RLWT Person has a broader definition than Overseas person

20 An individual is an offshore RLWT person if he or she: is a New Zealand citizen who has not been in New Zealand within the last three years holds a residence class visa and has not been in New Zealand within the last 12 months, or is not a New Zealand citizen and does not hold a residence class visa

21 A company or partnership is an offshore RLWT person non-individual if: it is incorporated or registered outside New Zealand or constituted under foreign law it is controlled (directly or indirectly) by more than 25% offshore RLWT persons, or more than 25% of its directors or general partners are offshore RLWT persons

22 Residential Land Withholding Tax (RLWT) will apply if: a sale amount is paid or payable on or after 1 July 2016, AND the property sold is in New Zealand and defined as residential land, AND the seller has: purchased the property on or after 1 October 2015 owned the property for less than two years before selling, and is an offshore person

23 Confirming if Residential Land Withholding Tax needs to be deducted what to ask: 1. Are you selling NZ residential property? 2. Have you owned the property for less than 2 years? 3. Was it purchased after 1 October 2015? If the answer to all three of these questions is yes, then the IR1101 Residential Land Withholding Tax Declaration will need to be completed by your client

24 What are your obligations as a vendor? 1. IR1101 needs to be given to your withholder along with any required accompanying documents stated on the form 2. Each person selling or disposing of the property needs to complete their own declaration 3. If the vendor is a trust or estate, a single trustee or executor of the estate may complete this form on its behalf

25 There are exceptions where Residential Land Withholding Tax will not be deducted: There are exclusions for the sale or disposal of inherited properties Holders of a valid certificate of exemption also will not have RLWT deducted If your client has had too much RLWT deducted they might be able to claim a repayment of this amount, complete a Residential land withholding tax repayment claim IR1102 form

26 When is a Certificate of Exemption from RLWT available? For a residential property developer: If they have a good compliance history with Inland Revenue, or If they provide a security interest to Inland Revenue, or Where the property is the vendor s main home under the bright-line test NOTE RLWT exemption certificates are different from resident withholding tax (RWT) exemption certificates RLWT exemption certificates will not automatically be granted to RWT certificate holders

27 How much Residential Land Withholding Tax will be deducted? An online calculator is available on the Inland Revenue website to help work out the amount of the tax to be deducted and paid to Inland Revenue. This will be the lowest of: 1. 10% of the sale price 2. 33% (except companies 28%) of the gain on sale (sale price less original purchase price of property) 3. Conveyancers selling price calculation (see next slide)

28 The third calculation depends on whose conveyancer is the withholder being the greater of: SELLER S CONVEYANCER PURCHASER S CONVEYANCER Selling price less: any outstanding local authority rates, AND any amounts to cover any mortgage or other security against the property Selling price less: any outstanding local authority rates Or Zero Or Zero

29 RLT applies to all return types except for a PTS

30 Correspondence is required when filing RLT information in a tax return Specific format Only 1 piece of correspondence can be attached Warnings for nil amounts and missing correspondence

31 How is RLT handled for an IR7? Added as a credit in other income An entry is automatically made in the Other income schedule

32 Provisional Tax Accounting Income Method (AIM)

33 Background Provisional Tax Calculation: Standard Uplift Estimate GST Ratio AIM Timing differences Accounting software

34 Eligibility Before a taxpayer can use the AIM approach to calculate provisional tax, they must: elect to use it before their first payment date use an AIM-capable accounting package that is up to date have gross income below $5 million

35 Exclusions In certain circumstances, taxpayers will be excluded from using AIM if they fail to use the regime appropriately It s proposed that excluded taxpayers will use the estimate method and UOMI would be applied

36 Payment dates Provisional tax will be due bi-monthly, Or If paying GST monthly, then Provisional Tax would also be monthly A business can only seek a refund of tax it has already paid

37 Use of Money Interest No UOMI if payments calculated are paid on time If underpaid then UOMI applies between the time of underpayment and terminal tax date No UOMI will be payable by the Commissioner on overpaid provisional tax

38 Year-end adjustment Currently most adjustments are identified and calculated at year end With accounting software, Inland Revenue envisage that adjustments can be made as transactions occur

39 Interim adjustments What might be required? The AIM provisional tax calculation is based on the same accounting information used for GST calculation. Adjustments will be required to account for items that affect GST and Income Tax differently, such as: Interest on borrowings Depreciation Sale and Purchase of Fixed Assets Accounts Receivable and Accounts Payable Closing Inventory

40 Tax Rates AIM payments can be moved amongst taxpayers within a family or group Taxpayers can choose the most appropriate tax rate to apply to AIM payments

41 Filing with Inland Revenue Electronic form to be designed Payment at time of filing Inland Revenue will not have access to accounting system Accounting information - For taxpayers using AIM, their accounting software will submit detailed accounting information (similar to the current IR10) with each GST return

42 What does this mean for small businesses? Provisional tax will be based on current year tax adjusted income Accounting software needs to be kept upto-date for provisional tax calculations Adjustments occur throughout the year The calculation of income tax will become integrated into the general operation of business accounts AIM will be responsive to changing business conditions

43 Tips when filing a Financial Statements Summary (IR10)

44 IR10 requirements An IR10 should: be fully completed and consistent with the financial statements have all relevant questions, including the disclosure questions (questions 52-59) completed not use the Other category questions in the profit and loss or balance sheet if there is a more appropriate category to use Refer to the IR10 Guide for examples of what items should be listed in each box on the IR10

45 The IR10 current year taxable profit/loss (question 29) should be able to be reconciled in AO Classic to self-employment or business income recorded in the income tax return

46 Check your totals and make sure they balance

47 IR10 tips If your client s depreciation for tax and accounting is the same it should be disclosed in question 13 (Accounting Depreciation) and question 52 (Tax Depreciation) Remember for the 2016 Income year onwards, question 21 has changed to capture Associated Persons. Which uses the definition from subpart YB of the Income Tax Act. In previous years this question captured Related party remuneration based on the accounting definition of related parties NOTE A full definition of Associated Persons can be found in the IR 620 A Guide to Associated Persons for Income Tax Purposes

48 INLAND REVENUE UPDATE

49 CAANZ UPDATE

50 3 new pieces of legislation Taxation (Business Tax, Exchange of Information, and Remedial Matters) Bill Taxation (Annual Rates for , Closely Held Companies, and Remedial Matters) Bill PAYE Reporting Bill Passed into law 21 Feb 2017 Expected to be passed March 2017 Expected to be introduced in March, to be passed later in the year

51 Taxation (Business Tax, Exchange of Information, and Remedial Matters) Bill Passed into law 21 Feb 2017

52 Business Tax Enabling legislation for Account Income Method (AIM) Provisional tax Safe Harbour changes includes more taxpayers in Safe Harbour Remove incremental late payment penalties for Income Tax and WfFTC More flexibility in application for Withholding Tax (Scheduler Payments)

53 Business Tax RWT exemption certificates will not need to be renewed annually GST Return Error correction threshold raised Closely held companies may elect not to use FBT for motor vehicles FBT threshold for preparing annual returns is increased to $1 million

54 Exchange of Information Inland Revenue s information sharing powers have been increased, they can: Share information with other government agencies Disclose tax debt to Credit Rating Agencies There is a criteria for disclosure that provides some protection to tax payers

55 Remedial Matters Expenses which are dual use (private & business) have a simplified method for calculating the deductable expense: Motor Vehicles Premises

56 Taxation (Annual Rates for , Closely Held Companies, and Remedial Matters) Bill

57 Closely Held Companies Deduction limit rule removed for most (not all) LTCs Eligibility criteria are tightened Tainted capital gains are removed for some situations Debt remission between LTC and owner or partnership and partner will not give rise to income

58 Proposed PAYE Reporting Bill

59 PAYE reporting For employers required to file electronically, the Employer monthly schedule (EMS) is to be replaced with reporting at every pay run The threshold for requiring electronic filing of PAYE information is to be reduced from PAYE of $100k pa to $50k pa The subsidy for payroll intermediaries is to be removed from 1st April 2018 Some other minor changes affecting PAYE calculations

60 Summary Reduce tax compliance burden Clean up inconsistency Improved accuracy through electronic submissions

61 MYOB SOFTWARE CHANGES AND ENHANCEMENTS

62 May 2016 UOMI rates have been included in your tax software 8.27% Rate Payable 1.62% Rate Receivable $50,000 RIT Threshold 08/05/2016 Effective Date

63 Video demonstration

64 Return preparation ACC thresholds and filing ACC WfFTC Maximum liable earnings $122,063 Parental Tax Credit up to $2,200 Maximum payable amount $1, Adjust your income IR215 form is only required to be filed if there are WfFTC adjustments to make

65 Property sale information IR833 is now available under forms in Return Preparation

66 How to update your templates for IR901d stationery to keep tax notices aligned AE Tax Tracking System AE Tax Tracking System (Reports) AO Classic AO/AE Tax Manager New Layout has been added New Layout has been added New Master Layout available New Master Layout available The new layout, 901DE3D, will now be used if Use old stationery is not ticked April 2009 stationery, 901DE3C,will be used if Use old stationery is ticked Practice Reports > IR901DL, the default master layout for the remittance section is now Pr901.2D If your practice report is at client level you will need to alter the remittance layout in Page Format from Pr901.2C to Pr901.2D manually Automatically updated to latest template Check stationary when printing is the same version Manually change to the latest template by following Knowledge Base article Answer ID 36810

67 Video demonstrations

68 See online help for detailed information

69 If your client doesn t have an address, you can t tax notices You will need to update client details or send by post

70 Video demonstration

71 MYOB PORTAL

72 Tax Returns to MYOB Portal MYOB Portal What is it? Setting up the Practice Portal Setting up a Client Portal Publishing a document to a Client Portal (and requesting an Electronic Signature, if required) Other considerations Security Feedback from Practices using MYOB Portal

73 MYOB Portal What is it? A secure online document collaboration solution for your practice, and your clients. Bundled with and fully integrated into your standard desktop product Included within standard monthly maintenance fees no additional usage costs Easy to use interface for your clients Simple to activate and configure

74 Collaboration between your practice and your clients Practice Publish documents to invited end users Request documents to be electronically approved End user View, comment, and download documents Electronically approve documents Upload documents and files* * File size limit of 18MB

75 Easy access from anywhere Accessible via a browser on either a desktop or mobile device Supported browsers include Safari, Internet Explorer, Google Chrome, and Mozilla Firefox MYOB Portal within the office Access via your desktop application MYOB Portal URL access: For the Practice: partner.myob.com For your Clients: yoursubdomain.portal.accountants

76 Setting up your Practice Portal You should be on the latest release Must have my.myob logins set up Main considerations are: Practice address Practice Name Portal Sub-Domain Whoever sets up the portal receives all nondocument notification s from that portal Logo can be added/changed anytime Overview

77 Click Live to get started and setup your Practice Portal

78 The Live practice space is created and populated with client data from your practice

79 Your logo can be added or updated at any time

80 Enter your practice name Your subdomain should align with your practice name Click this link for more information about the subdomain

81 Setting up a Client Portal Select the client Things to consider: Portal login with full access Portal login with restricted access addresses to be used

82 Click a menu to open a function View details on the right panel

83 The Clients area gives access to core client-based information and also the Client Portal configuration

84 Portals area shows all the Client Portals that exist for the practice

85 Enter a portal name. Note that this can t be changed once created Users and Contributors can be connected to any number of portals

86 Enter details of Users and Contributors who can access the client s portal These can be changed later, if required

87 Invitations are automatically ed to users and contributors

88 Our preference is to use an MYOB account, but a Google Plus account can be used The MYOB account is only used to access the Client Portal

89 The client can access their portal and view any published documents

90 Publishing a document to a Client Portal Documents can be uploaded from the AE/AO Documents tab Both the Folder structure option and Document Manager are supported Any document published is converted to a PDF (if not already this format) Documents can be viewed and also digitally signed (if required) Other file types can be sent/received

91 The Tax Summary and Extracted Return Reports have been printed to MYOB PDF Manager Use Save with task to store the PDF to the client s document filing location

92 MYOB Document Manager sites will be prompted to select the client and Profile the PDF

93 A prompt appears with the option to publish the document as part of this workflow Click Yes to prepare and publish the document

94 Practice Portal is launched using your my.myob login credentials

95 Profile the document with a tag and a year to make them easier to find

96 Note the extended year option capability

97 Choose who to notify by by selecting any or all of the users connected to the Client s Portal The Send an notification option expands when clicked

98 You can also specify that certain users need to digitally sign the document Signature required automatically triggers the Create task process

99 Select the person you want to request the signature from

100 Use the description area to add a client specific message Select the due date that you required the document to be signed by Complete the form then click Publish

101 Use the description area to add a client specific message Select the due date that you require the document to be signed by Complete the form, then click Publish

102 The Documents area lists the documents sent to clients

103 The Tasks area lists all the tasks that have been created

104 Client receives an letting them know they have a document that needs their approval (digital signature)

105 Clicking View Task launches the browser and takes the client to the portal login page

106 Enter their login details Note that the login can be saved

107 The document they need to view and sign appears

108 Clicking the document opens it in a browser

109 The two action buttons are activated by viewing the document

110 Information or comments can be submitted back to the practice as part of the process

111 After viewing the document, the client can electronically sign by clicking Approve

112 Click Approve to complete the process

113 An notification is now sent to the publisher

114 MYOB Document Manager displays that the document has been published

115 The task is completed and moved from the list of open tasks

116 Any published documents can be downloaded, viewed or commented on by the client at any time

117 Each page of the digitally signed document records the details of who approved it and the date-time stamp

118 Security considerations

119 Security Permissions Practice Portal Security can be set up for two tasks relating to Portal: Activation of MYOB Live Publishing client documents to their Portal 1. Access Security settings via Maintenance Map 2. Select Task Permissions

120 Security the Client s Portal Initial security is set up by you, as to who can access & what level of access they have Logging in to the Client s Portal as themselves out of your control Educate the client of the importance of keeping access credentials secure: Do not share your address Do not share your password Follow strong password creation guidelines If they think their login has been compromised, change the password NOTE The practice cannot create or change a client password, only they can do that

121 Security the Client s Portal Gmail can be difficult to log out of - users will need to: logout from the current Gmail account in order to logon as themselves click on the circle in the top right that has the first letter (or icon) for the currently logged in user then choose Sign out their logon details can now be entered/selected

122 How other Practices use MYOB Portal

123 How do you communicate and introduce Portal to your clients? Meetings On-Board packages

124 Which of your clients will enjoy the benefits that MYOB Portal offers? Tech-savvy Clients in a rush Most clients

125 What is the most useful document you share? Income Tax Return Financial Accounts GST Return NOTE Clients are also using the facility to upload source documents for the Practice

126 What has surprised you about using the service? Printing - time and cost saving Receiving client information Clients concerned about setting up my.myob login

127 SEE A FULL DEMONSTRATION IN THE E-BOOK

128 Additional Resources & Help

129 MYOB Portal guidelines Existing AE/AO team security permissions flow through into AE/AO Live Each AE/AO Document Manager client can only be linked to one Portal at a time Portals may have one or more AE/AO clients linked Each Portal may have any number of individual end-users ( addresses) configured

130 MYOB Portal guidelines All documents/tasks in a portal can be viewed/commented on by all owners Only task allocated end-users can approve or reject the task Approvals/rejections/comment notifications will be ed to the document/task publisher Documents published to the Portal by staff not requiring approval, can be flagged to notify 1 or more end-users at the time of publishing

131 MYOB Portal guidelines All end-users can upload documents into their Portal The Portal creator will receive notifications when documents are uploaded by end-users Both tasks and documents may be permanently deleted by the Practice only Document size limit is 18MB per document NOTE MYOB Live and the Portal are products under continuous review and development

132 FAQS FROM OUR HELP DESK 132

133 How do I maintain tax relationships & associates including shareholders, beneficiaries and partners Lets take a look

134 Video demonstrations

135 Why unreconcile and edit a transaction? Reconciling matches the transaction to the Inland Revenue date A payment might need to show at an earlier date for a tax notice to print the correct payment amount

136 Add, Edit, Delete, and Transfer MYOB Transactions in Tax Manager

137 How can you achieve your 100% filing targets? Monitor the filing of tax returns throughout the practice

138 Select Filing Statistics from the Tax menu

139 By default, the filing statistics for the previous tax year are displayed and calculated for each Agency

140 Why do I have more returns required for a tax year than I thought? Stay on top of client tax details

141 If a client is selected as a Tax Client they re added to the Filing Statistics in Tax Manager

142 Tax return clients

143 Tax tab client details

144 No longer a tax client? Go to the main tab and uncheck the tax client

145 General information

146 If your client is moving overseas When to use an IR3 vs IR3NR IR3 is moving overseas will be a non-resident for part of the year, and needs to file a part-year return IR3NR Client is outside of New Zealand for a full income year

147 Bankruptcy If your client has been declared bankrupt, two part-year income tax returns must be filed: one part-year return under the original IRD number (pre-bankruptcy) from 1 April to the official date of bankruptcy, and another return under the new IRD number from the date after they were declared bankrupt to the end of the tax year

148 Clients with "restricted status" If your client has a restricted status don t print and file a paper return from the Inland Revenue website This increases the risk of the return being processed outside of the Special Files process All restricted status customers will have an X in the DLN of their return

149 Provisional tax An election to use, or to stop using the ratio method to calculate provisional tax, cannot be made on an IR3 Certain criteria apply when changing to the ratio method or when exiting this method Contact Inland Revenue by secure or phone if you are not sure whether your client meets the criteria and to make any changes

150 Credit/payment transfers When requesting a credit/payment transfer on a return make sure all key points are completed, e.g. the IRD number, location (e.g. 001, 002), tax type (e.g. INC, FAM), and the amount to be transferred Make sure you also include the IRD number, location and tax type the credit/payment is being transferred to If you're requesting a credit/payment transfer make sure the entity receiving the transfer is registered for the tax type you're transferring to

151 Common things to check when filing and/or paying Return reassessments Provide corrections in writing not a new return Nil GST returns Box 15 is mandatory even if it is zero GST returns aligns with the filing period Business cessation IR315 or no-objection letter

152