Company records on file

The Importance of Company Records

by Dennis O’Grady
2 Minute(s) to read

Are you or your accountant the registered office of your company? If so you may be interested in the following.

Recently the Companies Office has started conducting audits on Company’s registered offices, giving the Directors two days' notice to provide their records. For those of you who aren’t aware, proper records need to be held. The records you are required to keep are:

  • Constitution (if the company has one)
  • Shareholders’ Minutes – last 7 years
  • Interests Register
  • Directors’ Resolutions and Certificates – last 7 years
  • Register of Directors – names and addresses of directors
  • Communications to Shareholders
  • Financial Statements – last 7 years
  • Share Register

Although most of what's on the list are self-explanatory the Interest Register and Share Register may not be.

Interest Register; records all director related party transactions monetary or nominal. This includes dividends or bonuses, new contracts, or use of assets including vehicles.

Share Register; records the movement of shares within the company.

There is a cost to having limited liability. Note if proper records aren't held the Director could be fined thousands of dollars per offence.

If this all sounds too hard you may want to see speak to your accountant or if he won’t do it then it’s a service that we provide.

Requirements for Trusts

Recently announced legislation puts Trustees on notice, what was once "recommended" then "required under the Trust Act" is now a tax requirement for most Trusts. Trusts with assessable income have increased disclosure requirements for the 2021–22 and later income
years. This includes the requirement to prepare a statement of profit or loss and a statement of financial position. This does not include non-active Trusts. However, It is worth noting to be non-active there needs to be less than $200 in interest income. Any other Income is likely to void the non-active status.

Overseas Activity

International tax evasion is more common than most people realise. IRD has been provided with international tax information for a number of years now, so what has changed. Behind the new tax system, there is more information than ever. In the past there has been so much
information about individuals and amounts that it has been impractical to match it in a timely manner, maybe your name is spelt differently, or maybe you didn't provide your New Zealand tax information to the UK government before moving. IRD is refining their work in this area
and finally putting the pieces together in a timely manner.

Be warned, if you have any dealings overseas it would be prudent to declare it.

HAVE WE GOT YOU THINKING?

Give us a call on (04) 563 6965 or email: dennis@taxman.co.nz or shawn@taxman.co.nz

Keep an eye out for April’s article!

TAX DATES TO REMEMBER:

  • 7 April 2022 Terminal Tax for those with an accountant.