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Business valuations
We offer expert valuation advice in transactions, regulatory and administrative matters, and matters subject to dispute – valuing businesses, shares and intangible assets in a wide range of industries.
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Capital markets
You need corporate finance specialists experienced in international capital markets on your side if you’re buying or selling financial securities.
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Complex and international services
Our experience of multi-jurisdictional insolvencies coupled with our international reputation allows us to deliver the best possible outcome for all stakeholders.
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Corporate insolvency
Our corporate investigation and recovery teams can help you manage insolvency situations and facilitate the best outcome.
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Debt advisory
An optimal funding structure for your organisation presents unprecedented opportunities, but achieving this can be difficult without a trusted advisor.
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Expert witness
Our expert witnesses analyse, interpret, summarise and present complex financial and business-related issues which are understandable and properly supported.
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Financial models
A sound financial model will help you understand the impact of your decisions before you make them. Talk to us about our user-friendly models.
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Forensic and investigation services
We provide investigative accounting and litigation support services for commercial, matrimonial, criminal, business valuation and insurance disputes.
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Independent business review
Is your business viable? Will it remain viable in the future? A thorough independent business review can help your organisation answer these fundamental questions.
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IT forensics
Effective ESI analysis is integral to the success of your business. Our IT forensics experts have the technical expertise to identify, preserve and interrogate electronic data.
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Mergers and acquisitions
Grant Thornton provides strategic and execution support for mergers, acquisitions, sales and fundraising.
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Raising finance
Raising finance - funders value partners who can deliver a robust financial model, a sound business strategy and rigorous planning. We can guide you through the challenges that these transactions can pose and help you build a foundation for long term success once the deal is done.
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Relationship property services
Grant Thornton offers high quality independent advice on the many financial issues associated with relationship property from considering an individual financial issue to all aspects of a complex settlement.
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Restructuring and turnaround
Grant Thornton’s restructuring and turnaround service capabilities include cash flow, liquidity management and forecasting; crisis and interim management; financial advisory services to companies and parties in transition and distress
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Transaction advisory
Our depth of market knowledge will steer you through the transaction process. Grant Thornton’s dynamic teams offer range of financial, commercial and operational expertise.
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Virtual asset advisory
Helping you navigate the world of virtual currencies and decentralised financial systems.
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Corporate tax
Grant Thornton can identify tax issues, risks and opportunities in your organisation and implement strategies to improve your bottom line.
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Employment tax
Grant Thornton’s advisers can help you with PAYE (payroll tax), Kiwisaver, fringe benefits tax (FBT), student loans, global mobility services, international tax
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Global mobility services
Our team can help expatriates and their employers deal with tax and employment matters both in New Zealand and overseas. With the correct planning advice, employee allowances and benefits may be structured to avoid double taxation and achieve tax savings.
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GST
GST has the potential to become a minefield and can be expensive when it goes wrong. Our technical knowledge can help you minimise the negative impact of GST
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International tax
International tax rules are undergoing their biggest change in a generation. Tax authorities around the world are increasingly vigilant, especially when it comes to global operations.
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Research and Development
R&D tax incentives are often underused and misunderstood – is your business maximising opportunities for making claims?
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Tax compliance
Our advisers help clients manage the critical issue of compliance across accountancy regulations, corporation law and tax. We also offer business and wealth advisory services, which means we can provide a seamless and tax-effective offering to our clients.
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Tax governance
Mitigate tax risks and implement best practice governance that will stand up to IRD scrutiny and audits.
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Transfer pricing
Tax authorities are demanding transparency in international arrangements. We businesses comply with regulations and use transfer pricing as a strategic planning tool.
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Audit methodology
Our five step audit methodology offers a high quality service wherever you are in the world and includes planning, risk assessment, testing internal controls, substantive testing, and concluding and reporting
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Audit technology
We apply our audit methodology with an integrated set of software tools known as the Voyager suite. Our technology has been developed to produce quality audits that are effective and efficient.
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Financial reporting advisory
Our financial reporting advisers have the expertise to help you deal with the constantly evolving regulatory environment.
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Business architecture
Our business architects help businesses with disruptive conditions, business expansion and competitive challenges; the deployment of your strategy is critical to success.
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Cloud services
Leverage the cloud to keep your data safe, operate more efficiently, reduce costs and create a better experience for your employees and clients.
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Internal audit
Our internal audits deliver independent assurance over key controls within your riskiest processes, proving what works and what doesn’t and recommending improvements.
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IT advisory
Our hands on product experience, extensive functional knowledge and industry insights help clients solve complex IT and technology issues
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IT privacy and security
IT privacy and security should support your business strategy. Our pragmatic approach focuses on reducing cyber security risks specific to your organisation
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Payroll assurance
Our specialist payroll assurance team can conduct a review of your payroll system configuration and processes, and then help you and your team to implement any necessary recalculations.
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PCI DSS
Our information security specialists are approved Qualified Security Assessors (QSAs) that have been qualified by the PCI Security Standards Council to independently assess merchants and service providers.
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Process improvement
As your organisation grows in size and complexity, processes that were once enabling often become cumbersome and inefficient. To maintain growth, your business must remain flexible, agile and profitable
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Procurement/supply chain
Procurement and supply chain inputs will often dominate your balance sheet and constantly evolve for organisations to remain competitive and meet changing customer requirements
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Project assurance
Major programmes and projects expose you to significant financial and reputational risk throughout their life cycle. Don’t let these risks become a reality.
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Risk management
We understand that growing companies need to establish robust internal controls, and use information technology to effectively mitigate risk.
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Robotic process automation (RPA)
RPA is emerging as the most sophisticated form of automation used to help businesses become more agile and remain competitive in the face of today’s ongoing digital disruption.
Tax law on the run
I have written before about Inland Revenue’s win at the Supreme Court in the Penny & Hooper case. As a refresher, the case involved two Christchurch orthopaedic surgeons who each transferred their practices to a company, the shares of which were owned by a family trust. Instead of earning all the surgery income in their own names, the company paid them a (lower) salary, and the rest of the income stayed in the company. The salaries were determined by reference to public hospital pay rates.
While there were a number of reasons for the restructure, there was a tax advantage as, at the time, the top personal rate was 39 per cent, while the company and trust rate was 33 per cent. In the current tax environment, the tax advantage is less because the top personal tax rate is now also 33 per cent.
Hot on the tail of the court decision, Inland Revenue released a “Revenue Alert” setting out their view that income earned through the direct personal skills, experience or labour of an individual should generally be taxed in the hands of that individual. Further, as a general rule, Inland Revenue say that they are “unlikely to investigate a tax position where 80 per cent or more” of the income has been returned by the individual.
Inland Revenue accept that there may be times when it is inappropriate to award that much of the business income to the individual, such as planned capital expenditure, leveraging the work of employees, and business conditions.
That this sort of common-place, ordinary and legitimate business structuring is now considered tax avoidance sticks in the craw. The loss of clarity now faced by business owners is unacceptable, and it is disappointing that this year’s Budget did not tighten up on this new “grey” area of tax law. Inland Revenue have now taken it upon themselves to use the Penny & Hooper decision as some sort of mandate to effectively create their own pseudo-legislation.
Legislation introduced in 2000, when the 39 per cent personal rate was first introduced, specifically addressed the attribution of personal services income. However, it only applies where a company structure or similar is used and 80 per cent or more of services income is generated by an individual, where there 80 per cent or more of the income comes from one customer and there are no significant business assets. In addition to complying with this specific income tax rule, business owners must now also contemplate how the generic rules issued by the Inland Revenue could apply to their situation, and more importantly be applied with the benefit of hindsight by the Inland Revenue.
Adding to this unpalatable situation is Inland Revenue’s recent advice of their plans to increase the level of investigation activity in this area. They advise taxpayers to consider making a voluntary disclosure in respect of past periods so that exposure to penalties can be minimised. The only concession is that they will only amend the two last income years filed before the Penny & Hooper decision. What needs to be appreciated is that it is not just surgeons that will fall prey to Inland Revenue attention. Any business where income is earned through the application of personal skill and effort is at risk of being reviewed, including plumbers, electricians, computer technicians, and hairdressers. Maybe even accountants!
A good tax system should provide taxpayers with certainty. When judge-made law gets applied with retrospective effect to areas of tax law already addressed by Parliament, that certainty is lost.
Further enquiries, please contact:
Geordie Hooft
Partner, Tax
Grant Thornton New Zealand Ltd
T +64 (0)3 379 9580
E geordie.hooft@nz.gt.com