There’s more information on all these points below, but if you’re short on time, here’s a summary:
•You need to pay tax on all your jobs. Make sure you set money aside for tax from every pay cheque (unless you’re exclusively working through a labour hire company that’s paying your withholding tax, or are otherwise having the correct tax deducted at source).
•When you file your tax return, choose the BIC (Business Industry Classification) code of the activity you spend the most time doing. This code, along with your earnings, is what your ACC levy is based on. Talk to ACC about the jobs you’re doing, and the best way to estimate what your ACC levies might be. That way you can set the money aside as you earn it. Be aware that ACC may charge their levy on the activity that attracts the highest levy rate.
•If you expect to earn more than $60,000 in the next tax year, or you charge GST, you need to register for GST. That also means you can claim a credit for the GST you pay on most of your business expenses.
•You can claim for the business expenses you incur when you’re working, but make sure you keep great records, and keep all your receipts.
•Tax agents or accountants know all the expenses you can claim for – using one will end up saving you money. Accounting software might help you manage your record keeping and keep track of tax.
•Many casual workers are sole traders – people trading on their own. As a sole trader, you can get a free New Zealand Business Number (NZBN), a unique identifier available to every business in New Zealand. It could save you time and money by allowing you to share and update your business information with other businesses, including those you do casual work for.
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