INSURANCE AND TAX DEDUCTIONS TIP
What Is Deductible - What Isn't
There's a wide range of business related insurance products out there, so it can be challenging to decipher what's tax deductible – and what's not.
In general, the following rules apply:
Loss of earnings
HOW TO DEFEND YOUR PRICING STRATEGY
Resist Discounting Your Profits
In the long run, to be the cheapest is a refuge for people who don't have the flair to design something worth paying for, who don't have the guts to point to their product or their service and say, 'this isn't the cheapest, but it's worth it.'" - Seth Godin
"A client recently asked me if I could design a cheap logo for his restaurant. So I asked him if he could make me a great lunch using really cheap, fast, low cost food, to which he replied 'Probably, but why would I want to? My business is…' He didn't finish the sentence, as he'd got the point." - Richard Knobbs
"Your business is 100% more likely to survive if you build your pricing strategy around achieving a reasonable and fair profit rather than the lowest price expectations of your customers." - Jamie Tulloch
Here's a pricing question for you to consider:
How do you know if you are pricing to high or too low for your industry?
Do you believe what you hear your competitors say via word of mouth? Do you guess? Even if your sale price is the same, how do you know where to set your materials and/or labour costs?
This is an area we can really help you with...
HOW TO LIVE LONGER TIP
Consume Red Wine and Chocolate - Really?
In a truly upsetting piece of news, scientists claim there is no proof chocolate and red wine help you live longer, despite millions hoping they do. A study failed to find any evidence resveratrol, an ingredient found in the skin of red grapes and chocolate, is linked to long life. The antioxidant was believed to have a range of anti-ageing properties. But researchers say levels found in the body have no "substantial influence" on inflammation, cardiovascular disease, cancer or longevity.
Previous studies have shown the plant compound improves the health of mice fed a high-fat diet and increases their lifespan. But there has been controversy about whether it really does hold back the march of time. Now scientists say they have the answer - it doesn't.
(This downer thanks to The Main Report)
TAX LOSS COMPANIES
Should They Be Part of Your Tax Strategy?
Years ago, a Mr. Ron Brierley saw how much tax he could save – or never pay – if he owned companies making losses to off-set against those making profits. As many of you may know, he did this rather well by buying companies with tax losses. Since then the IRD have tightened the rules and so it's somewhat more problematic now to buy ownership of tax loss companies when you need to abide by the shareholder continuity rules.
But the big question is – when does the IRD start to look at the commercial viability of a business that continually loses money? The inside word is "quite often and with increasing frequency."
If your business is not making money, is it really a business deserving of tax deductible expenses? Is it a genuine business or just a hobby set up to achieve tax deductions and accumulate losses? Year after year losses will attract the IRD. Talk to us before they talk to you.
Have you checked out our blogs?
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