One of the first things a small business owner should learn about before opening their venture is what GST is. Standing for Goods and Services Tax, GST is a fee built into the price of pretty much every good or service you can think of, which is collected by businesses for the government.
Every single person who has ever bought anything in New Zealand has contributed to this fund in some way, from the largest companies through to the smallest start up ventures. However, understanding these taxes is an important aspect of running a business to wrap your head around before moving forward with your plan.
The basic principle is that businesses collect GST and pay it to Inland Revenue, which is funnelled through to the government. In return, businesses can claim back GST on products and services bought as expenses - allowing for a return in funds that could be beneficial for the venture.
Keeping track of the GST across your venture can be a little difficult. Luckily, there is a small business accounting software program that can help you maintain records of your spending and provide an overview of how much GST is owed.
The CashManager software from Accomplish allows for a streamlined tax filing process, making it as simple as possible for small businesses to take care of their tax payments. You can choose to file every month, two months or six months. Choose the period that most suits you and your business model and use these programs to keep an eye on your cashflow - including GST-applicable transactions - to remain on top of your finances.
Ensuring you take care of your GST payments regularly and promptly is an important thing to take into consideration when you're establishing a new business venture.