Property Accounting Services
Annual property accounting is a specialist area. Naturally you are keen to know that your taxation adviser is locking down every cent of tax deduction that you are legally able to claim, and optimising your tax.
You need to know that you have people that are ethical and well-regarded managing your affairs, so that you do not get audited regularly by IRD. (Some accountants have bad reputations with IRD!)
You need to know that you have the best advice, the best structures, and that you will be supported in your investing decisions with good common sense advice, from people that do it themselves and speak from experience.
We’ve interviewed and helped thousands of Kiwi property investors over the years, from people just starting out right through to high net worth people with large portfolios. After helping so many people with property accounting, we’ve learned a few things about how we can serve people in the best way, and what people actually need.
What's Important to You?
Generally, when people approach us to handle their property accounting affairs, they are looking for the same things. You will probably want to know:
- That your property accountants or taxation advisers have the knowledge to identify every possible (legal) tax deduction so that you can pay less tax
- That your accountant actually does what you’re paying them to do
- That you are working with experts who are ethical when it comes to managing your affairs
- That your property accountant is well-regarded and a specialist to give you peace of mind
- That your accountant can give you expert advice including the best structures that support your investing decisions with good common sense
- And as a bonus…to know that your property accountant can offer advice and services because they are active property investors themselves
Overall what people really seek is great value.
For property investors, we believe that value comes from not just having an accountant who can do the bean-counting. It’s also about having a specialised property accounting and structures expert on hand to guide you along the way, without it costing you any more.
That’s what we do at GRA, and we’d like the chance to serve you and to prove it. In fact, the expertise and advice we provide ends up actually saving our clients time, stress and, above all, money.
Some property accounting guidelines
Do you have all of the standard expenses in your rental return, including:
- Accounting fees
- Body corporate fees
- Depreciation, including chattel valuations
- Home office expense claim (a percentage of your home expenses, based on the ratio of the size of your home office as a percentage of your home)
- Property management fees
- Repairs and maintenance
- Telephone and toll costs incurred in relation to management of your property
- Vehicle costs associated with running your property portfolio
- Valuation fees relating to financing
*Note most buy-to-hold properties are subject to the interest non-deductibility rules introduced in 2021. There are some exceptions, e.g. new builds.
While this list is not comprehensive for a passive investor, it is a good starting point and something you can be assured that GRA will be looking at annually for you if we are managing your affairs.
Cashbooks & annual accounting information - how do we collect information from you?
Providing your accountants the information they need at year end to do your tax is simple and fast.
- Firstly you need to fill in an Annual Client Questionnaire, a form into which you enter all of the things the accountant wants to know, e.g. any assets you bought or sold during the year, your cash receipts and payments throughout the year, and your home office claim. At GRA you can do all of this easily and securely online via our IQOnline tool.
- Secondly, your accountant will want a cashbook (if you have one) showing cash received and cash paid.
- At GRA we offer many ways for you to provide your cashbook information to us. Some of these are as follows:
- Manual systems - give us a list of receipts and payments made by you and we will collate them.
- A spreadsheet - the cheapest (it's free) and most straightforward option. We give you a spreadsheet to fill in and you track your receipts and payments in it. Simply fill it in and email it to us. You can download cashbook spreadsheets from the Free Resources section of our website.
- Xero accounting software. Xero is online accounting software designed to make bank reconciliations simple. It provides real-time insightful reports and you can share access with your accountant.
- Any other property accounting package you wish to use - we can read nearly all of them and import the data.
Remember, best practice is to make sure that all business-related receipts and payments pass through the bank account that relates to that business. This makes it easy to track and trace all business income and expenditure, and ensures you do not forget to report the expense or income at year end.
An Example of a Typical Salaried Property Investor Structure - Family Trust & LTC
An Example of a Typical Property Trader / Developer Tax Structure