Personal Finance New Zealand

Please keep rule 5 in your mind. Zero tolerance for personal attacks and harassment.

If a small business wants to provide Health Insurance (e.g. Southern Cross or NIB) to its directors, it is of course liable for FBT (I believe).

FBT is charged at [a whopping] 63.93% of the GST-inclusive cost.

So lets say annual cover is $10,000 + GST.

Company pays $10,000 + $1500 gst

Company recoups the GST: $1500

FBT annual cost is $7351.95 (63.93% of $11,500)

-- so companies tax bill is reduced by 28% of (7351.95+10,000) = $4858.55

So a bill of $11500 for medical insurance if bought by the individual, would cost the company:

11500... less gst: -1500.... tax bill reduction: -4858.55... plus fbt cost... 7351.95

= $12,493.40

What am I missing here? (is it that only large companies do this as they can negotiate a better rate with the medical insurer?)

I bought my 2015 Mazda CX-5 2.2L Dsl for $16k just shy of a year ago now. All was well, 142k kms on it, ran well and was all up my dream car.

I have driven about 12,000 kms on it now since purchasing.

A few weeks ago, I was driving into my nearest town when I suddenly lost power coming around a 80km bend with my 2 toddlers in the car. Was very scary but we were fine. I looked at the dash to see what had happened, and I noticed a red oil light (oil pressure) and orange engine light on. I straight away dropped it at my mechanics.

The outcome was shocking (and expensive) , the oil pick up was 95% blocked with solid carbon build up which means the engine has been starving of oil for who knows how long. The mechanic was quite sure this would have been like this before I purchased it and he insisted I get in contact with the dealer or get rid of it, as although they have replaced the oil pick up, the engine was starved too long and has done too much damage. He says the engine could essentially seize on me any moment, which is a terrifying though with my kids in tow.

I emailed the dealer a very straight to the point, full of knowledge, references to the CGA type of email. I was so hopeful he would reply an offer to replace the engine, or take the car back. But no, his response was basically ‘not my problem because you’ve owned it a year and it’s done over 10,000kms’ he also says he spoke to a Mazda specialist who said this issue would have developed while in my ownership (even though my mechanic said otherwise)

Is he right? Can I not doing anything under the CGA because of the ownership length and amount of kms I’ve done?

I felt defeated so I never replied and left it as that. But i am determined to fight again, I can’t afford a new car and I can’t afford to not have a car if the engine blows.

A few days ago there was some article about what do do if you won $34 million in Powerball and the advice was put it all in index funds and have about 1.5 million a year to live off. Obviously that's not me. But it got me thinking.

How (if at all) do you generate ongoing income from index funds or similar vs just leave everything in there an allow it to compound for... ever?

Do you simply cream off all the interest while allowing your initial deposit to depreciate? Cream off everything that is over inflation so that while your deposit doesn't depreciate, you also don't compound much?

What if you're saving for retirement - once you're retired, do you just start drawing money from the pot and run it down to zero or is there an optimum way to use less but still keep some invested?

I have a feeling I'm missing the point of some of this, but I don't quite know what.

Don't know if this is the right place to post but could use some advice. My wife and I are currently in the process of buying our first home and are both starting to get a bit stressed out about it. We've had our conditional offer accepted at asking price. We've received the builder's report, and there's a lot of things that may need some attention in the near future, such as roof repairs, some wiring issues, quotes are on the way but it could be in the $20k+ ballpark for cost to remedy.

The house is in a small-ish town, and from what we can tell most houses listed in the area would need quite a bit of work done, so it feels like this is how it would go in most cases since people here seem terrible at looking after their properties.

We're thinking of going back to the vendor with the quotes and asking to either have it remedied or have some amount taken off the purchase price. My question is, who can we ask on whether or not this place is going to be a money pit? The builder said it's all maintenance work and no big red flags, but he legally can't give us a recommendation. The real estate agent is obviously not our friend here, our mortgage broker is incentivised to close the sale to get their commission from the bank, our lawyer can't give us advice on whether to buy beyond legal advice either. It feels like there isn't any way to get a less strongly biased opinion on whether it's safe to go ahead or not, it's all very overwhelming and very difficult to make sense of.

Hey I have noticed many US based people on various PF forums talking about making money on survey websites.

It doesnt sound like much money but sounds kind of fun and something I wouldnt mind doing when I am sitting around in bed being lazy in the mornings to earn a small sliver of extra cash.

I started looking at one of the sites and got a bit spooked out as it looks like it requires a lot of special ID and also makes the payment to a paypal account or something weird like that. I have so many questions. Seeking input from experienced players who have done it a lot:

1. What sites are best for being in NZ?
2. What ID did you need to use?
3. Do you have concerns about identity theft risk? How is that minimised?
4. How does the payment get distributed?

I'm hoping they've moved on and are using software-based authenticator tokens.

I just turned 18 and I wanted to start Investing before I have more responsibilities

Currently the only thing I pay for is my own food and transportation as I’m still year13 and living with parents. ($30/week for transport and trying to make a budget for food that works for me)

I have -100 in my anz serious saver -250 in Dosh savings account -100 in my Sharsies saving account

And I get paid around 250-330 each week, any tips on how to keep saving and investing would be appreciated.

I save a fair wack in KiwiSaver & a PIE high-growth fund with simplicity, and another similar one with Synergy.

Now that my emergency fund is sorted, I have about 50k I want to invest at a higher rate of return. But I can't decide between something like a squirrel where I'll be paying 39% on the return or if I should put it into the PIE funds.

Is there any other option that I have?

So im on approx 82k p/a. After taxes etc i get $2022 p/f. Here’s my fortnightly expenses:

Rent: $990 (well aware that this is ridiculous as a single person but am unwilling to sacrifice my mental health by living with others and i haven’t been lucky with finding somewhere cheaper)

Groceries: $160

Petrol: $100

Home expenses (garden maintenance, cleaning expenses, etc): $55

Power + internet: $90~

Car insurance: $37.79

Other car expenses (rego, wof, etc): $25

Phone bill: $25

Pet needs: $20

Family expenses: $45

Travel: $200

Savings: $40

Personal loan: $125.58 (14k~ left. Interest rate is 10.95%. Loan term till 2030.)

Student loan: $2k~ (due to be paid end of September)

ASB doesn’t take checks anymore…

EDIT: I have a check in a foreign currency

So to cut to the chase the company I work for deducts the tax from my payments for me, which is nice. However, I heard I could get money back for each kilometre I drove. I'm looking at IRD and not finding where this is or how to claim it. It's also my first time doing my taxes for actual work so a little confused on what I need to fill

Hi all,

I have been lucky enough to get a fairly nice job offer for a role in the UK (not London) which I have accepted. I own a house here in Christchurch which I will be selling (don't plan to rent it), and had a few questions about the process.

1. Is it better for me to sell the house while here or wait to list once I leave? I can see pros and cons to both but I'm not sure what is the norm. It seems logical to sell it empty and just stage it, but it also would be easier to manage from here while I'm still around. Obviously I'll do all the lawyer and real estate agent stuff beforehand no matter what.

2. I am unable to buy a house in the UK for a while, and as I bought my house pre-covid I'll have a bit of extra $$ floating around from the sale. I would probably like to put this somewhere safe (e.g. term deposit or safe investments) after the sale. What would potentially be the best approach here, keeping in mind I'd possibly like to draw down my money for a mortgage there if I end up staying long term.

3. Might be a silly question, but is there a thing where you can get a builder/inspector to come round and just identify things that need fixing? I'd rather get it all sussed out now rather than wait until someone gets a building report and have to get it all done under pressure, but honestly I'm not sure what might need doing at this point!

Also, as I have some relocation costs as part of my offer, so I'll want to find a moving company to ship a few boxes, so if anybody has any recommendations that would be great. I'm not taking big stuff, just want some boxes delivered, picked up and sent over.

And if anybody happens to be able to recommend real estate agents for Christchurch (south west) that are reasonable price, good at their jobs but also not absolute scumbags that would be really appreciated.

Any other advice would also be greatly appreciated from anyone who has done this before!

Cheers!

Hey there, Looking to buy a house soon found one I really like but they have a built on extension to the house without building consent applied. They are offering to take off the extension and put back the window for a reduced price or leave it.

I assume the process for getting this approved is difficult or they would have it..

What would the process be here or any sort of recommendations?

I want the extension, its pretty much an extra bedroom for the entire house so its worth the extra.

Ok so, I’ve recently downsized my housing & I’m wondering about the next steps…

Background Mid 30s, single, no kids, no plans on having kids House worth 610 Mortgage of 300k Savings 110k Repayments approx 1k/week (mortgage was much larger & carried over with the downsizing)

Rental (50%) 450k, mortgage 350k Covers costs, new build so no hefty r&m anticipated

Business (50%) Worth approx 500k in total (100%), I have 170k loan over my half Business partner wants to retire in 2 years

Annual salary + dividends of approx 180k

KiwiSaver approx 70k, no other investments

What should I do next?

I can 1. Put the 110k in my mortgage, leave mortgage payments high, get that paid off then onto the next step

1. Buy a rental property around the 500k mark, reduce mortgage payments on home loan by the approx top up amount of this property

2. Keep saving into an offset account & buy out my business partner when he retires (If I don’t do this, we will just sell half of the fee book to someone else, there’s no great commercial risk). My income would likely rise 60k or so.

3. Option 1, plus I sell my half of the business, go overseas.

Open to any other suggestions too…

Edited for clarity

So, in between court cases that it seems to be battling left, right, and centre with the FMA, business partners, newspaper owners, ex-employees, sub-contractors, and investors; Du Val is firing its own construction company from one of its projects https://businessdesk.co.nz/article/property/property-group-du-val-fires-its-own-construction-firm, and has its main funder walking away from it mid-project https://www.nbr.co.nz/property/du-val-to-finally-consult-with-btr-investors-as-lender-walks/ .

Has anyone got any of their investment back out of them yet?

It looks like it's a sinking ship. What are the repercussions of this going to be? Investors losing deposits, more subbies losing money, people who've bought off the plans losing their deposits - who else is going to be licking their wounds when this happens?

Kenyon's made his wife director of the business. What experience does she have to be responsible for the hundreds of millions of dollars at stake here? Is no longer being director enough to let Kenyon off the hook?

Hi, can someone help me make sure I’m understanding this correctly

In my tax assessment it says Tax on Taxable income is $12,985.30

Under Tax Deduction it says Total PAYE 11,940.64 ACC Levy 1,016.14

Under Total Tax Deduction it says (Tax I have already payed) 10,948.43

Total Tax to Pay 2036.87

I am a PAYE employee, and it says Tax and ACC deducted 11,940.78, ACC levy comes out of my pay every week automatically

So is it correct in saying I owe 2036.87?

Thanks for anyone that can help!

Sorry if you are all getting sick of this question, but I'm really new to this and want to make sure I'm doing this right and would really appreciate any advice on this. So sorry for the essay:

The Property:

• It sits in a block of 9 or so units 45+ minutes away from the city centre with no traffic. Half of the units are just finishing up now, the other half will be done in 2 months.
  
• Freehold titles, no body corp
  
• Of the units, 2 are like 'penthouse' type versions with 4 bed, 3 bath etc (160sqm floor space, 160sqm land) and sold for $1.3m early in the process
  
• the remaining 7 units are 2.5 bedrooms, 2 bathroom, 1 garage (The total floor space is around 120sqm and 100sqsm of land). Of these units, only one went under contract in February. They originally listed this unit size at $1.2m Oct-Nov '23, but dropped to $1.05m, and dropped to about $980k in the last month
  
• I enquired at the beginning of May, I asked why they had dropped in price, and they said they needed one more place to sell now so they'd have financing to finish the rest of the builds.
  
• It doesn't seem like there is much interest, at least not at the one I'm looking at. There have been no open homes and they've not mentioned any interest. But I could totally be wrong.
  
• when I was chatting to them after the 2nd viewing to see what info I could get out of them, I asked how flexible they were with pricing. They obviously didn't give anything away and they asked me 'how much we talking' and I said 'as close to $900k', which they said 'naw too low'. but when I asked 'ok, how much' they said give us an offer and we'll go back and forth, which is fair.
  
• I checked sales data for the suburb and honestly can’t find units in the area that have sold, just houses which go for anything for $1.1m - $1.8m or higher.
  
• The CLOSEST property I could find in comparison was a unit of very similar size, built in 2002, but in a very attractive location right next to the beach and in the town centre with shops, and it also has body corp. It had a $850k CV and sold for $980k

Me:

• Single, no dependents so I’m doing it alone
  
• I love the suburb despite it being far away from the city centre. But I luckily WFH full time so I can work from anywhere.
  
• I have been given pre-approval from two banks for the full price of $980k. One for my current deposit of like 17.2% @ 7.24% 1 year fixed and another for if I have 20% deposit @ 6.12% 1 year fixed.
  
• I’d really love to get this place $850k - $900k, I’d be less happy but ok to get it at about $930k, and I’d not be thrilled to get it at $980K but I could.
  
• I've seen the property 3 times and I KNOW everyone says not to fall in love with a property, but I really have and I'd really like to get this property for the right price. This fits all my requirements and though it's a tiny bit smaller in the kitchen / living space, I love the rest.
  
• I’ve not seen a single other property I like in the last 5 months

It's come time to put in an offer and I feel really out of my depth. A family member encouraged me to go in with an $850k offer with the current market as they will never accept your first offer so it’ll land at a good place. When I mentioned this to my broker, she said 'you don't want to go so low they don't reply' which freaked me out a little. I reached out to a friend who is a real estate agent in the same city on the selling / buying side and I asked if $850k was silly and they'd not reply. He was all for it and said the market is totally in my favour and I should go in with $850k and 'any real estate agent worth their salt will counter offer you' as he’s seeing properties go under asking and not as many buyers in the market.

Reading other people's answers to similar questions on this forum has also made me uncertain as some say ‘go for it, there’s no such thing as rude, can’t hurt to try.’ but I saw a few comments that said ‘give a low enough offer, you’ll lose every chance of buying that property’ which again really concerned me.

I really want to get this property and for the right price. I also want to take advantage of the market being in my favour, but I’m worried about losing out on this property all together if I go in with an offer of $850k this week assuming / hoping they’ll counter / negotiate.

It’s all so extremely new to me and I don’t really have my parents etc to guide me, just what advice I’ve been gathering and what I’ve been reading up on.

Am I taking too much of a risk by offering $850k as my first offer? Thank you for reading this far!

My family are looking to sell our house but structural walls have been removed over 10 years ago making the house way more liveable - but it was unconsented. An engineer came through recently and his advice was "if it was a problem you'd know by now". Anyway we are worried the banks won't lend to buyers for the place because of these unconsented works making it harder to sell. I'm looking at getting a third party safe + sanitary report put onto the LIM in the hopes this will make the banks give a green light - has anyone had any experience of this working or not working?

Hi everyone,

Something really traumatic happened to me and I Ideally would like to move overseas and start a new life. I just don't feel safe anymore - I'm currently going through the Justice process and not allowed to know about the offenders criminal history. But on the odd occasion I've needed to talk to a Detective, Court Staff, and Corrections - they all sound horrified - I think my safety is pretty compromised. The Detective said there was no concern based off previous Criminal History - but the offender lives just 1km from me. I just want to move on, and not run into that circls of child abusers from time to time.

What kind of supporting documents would I need? Thank you.

Hey all, I've been giving Sharesies a go for the past 6 months but the fees are really doing me in. Wondering if anyone knows of a good alternative.

Thanks and have a great long weekend!

I have dual citizenship for uk and NZ

Looking at buying a rental property in the UK and I’m wondering what my NZ tax obligations would be? Does anyone have any experience with this situation.

Hi everyone

While (low) average KiwiSaver and savings balances are discussed a lot on Reddit and in the news, many readers ask, "How should I spend my retirement savings so I don't run out but also make the most of my golden years?" The answer isn't simple, and to help, we've drafted a new guide - https://www.moneyhub.co.nz/retirement-money-drawdown.html

I plan to share it in next week's newsletter, but I want to hear your thoughts. It's 5,000+ words and draws on trusted studies, tools and resources; I want to give ideas to help New Zealanders with savings of any size make informed decisions.

I'm very interested to know if you have any plans and/or experience and what you think we can add to help more people.

Thanks in advance!

Assume portfolio is big and well over 50k.

NZ investors directly holding FIF exempt Australian shares pay tax on dividends only.

NZ investors holding FIF exempt Australian shares in a PIE fund pay tax on an assumed 5% return under the FDR method, not on the actual dividends received.

Should be safe to assume that actual dividends are usually less than 5%. It seems a bit unfair that PIE funds have a less favourable tax treatment of FIF exempt Australian shares.

Currently my portfolio consists of passive NZ and global equity PIEs.

I am curious to know if it is worthwhile adding direct holdings of Australian shares to the portfolio, to be more tax efficient. Attempting to replicate the S&P/ASX 200 would be challenging and probably not worth the effort or cost, but I wonder if anyone has tried anything like this.

Thanks