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Minimum sick leave entitlement will increase to 10 days from 24th July 2021

Currently, employees working for the same employer for more than six months are entitled to at least 5 days of sick leave per year.

Parliament has passed the Bill to increase the minimum employee sick leave entitlement from 5 days to 10 days per year. This will come into effect from 24 July 2021.

Employees will be entitled to sick leave under the new rule on their next entitlement day.

This could be:

  • Six months after employment, or
  • 12 months after the last time you entitled to sick leave.

Tips for employers:

  • Please ensure your system is updated to record the correct entitlement for employees.
  • Encourage better communication within your team to better arrange workload when someone needs a rest!

Tax Issues?

Contact one of our tax advisory team by emailing or simply call 09 281 8885 to discuss your situation today!

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Depreciation on Buildings From 2020-2021 Financial Year

As part of the COVID-19 Recovery response, the Inland Revenue allowed depreciation for commercial and industrial building, starting from 1 April 2020.

Now if your business is eligible you’ll be able to claim depreciation deductions in your tax return for commercial and industrial buildings.

Depreciation MethodBuilding Depreciation Rate (%)
Diminishing Value2%
Straight Line.1.5%

Previously, tax depreciation on all buildings was at 0% because of 2011 tax changes.

Residential buildings are not part of these depreciation changes.

But you may be able to claim depreciation for short-stay accommodation (such as AirBnB) if it’s seen as having a commercial substance.

Generally speaking, if there are 4 or more separate units within the same property and they’re used for short-stay accommodation, they can be depreciated.

Tax Issues?

Contact one of our tax advisory team by emailing or simply call 09 281 8885 to discuss your situation today!

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Are you a NZ tax resident?

Tax residence rules are different from the normal New Zealand immigration residency rules. You can still be a NZ tax resident and pay tax for your worldwide income when not living in NZ and vice versa.

This article helps you test whether you are a New Zealand tax resident, and understand your tax obligations.

Tax residencyTaxable income
NZ tax residentsYour worldwide income is subject to NZ tax laws.
Non-residentsOnly NZ-sourced income is taxable.
Tax obligations for NZ tax residents and non-residents

If you are a NZ tax resident, your income earning from other countries will also be subject to New Zealand tax law, even if you did not bring that income into this country.

New Zealand has Double-tax-agreements with many countries. In most situations, you won’t be taxed twice.

You’re a New Zealand tax resident if:

  • you’ve been in New Zealand for more than 183 days in any 12-month period*; or
  • you have a permanent place of abode (see below) in New Zealand.

*Except for 1) you’re away from New Zealand in the service of the New Zealand government; 2) you are an overseas seasonal worker.

Permanent place of abode

This question is similar to “Is New Zealand your home?”.

To satisfy this, you must have a house or other dwelling that you could live in NZ. But this isn’t enough.

The following questions should also be considered:

  • Do you intend to return to NZ? For how long?
  • Past use of your dwelling in NZ
  • Your family, social, employment ties with NZ

Individuals with strong ties to New Zealand are likely to have a permanent place of abode in New Zealand, but all of the circumstances need to be considered.

Becoming a NZ tax non-resident:

If a New Zealand tax resident is absent from New Zealand for a period of 325 days in any 12-month period they will become non-resident, unless they continue to satisfy the permanent place of abode test.

Tax Issues?

For more information, contact one of our tax advisory team by emailing or simply call 09 281 8885 to discuss your situation today!

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