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Insight, news and updates from Alliott NZ Chartered Accountants, Auckland New Zealand. The views expressed here are the views of the author and should be discussed in further detail should an article be relevant to your individual circumstances.

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Declaring insurance payments

Written by Alliott NZ on August 26th, 2014.      0 comments

If you receive any insurance payments, they may affect the amount of tax you pay.

If you’re a business or rental property owner, you may need to declare some insurance payments in your income tax and GST returns. These could affect the amount of tax you pay. For example, the following insurance payments are taxable:
 
  • loss of profits
  • loss of rents
  • reimbursement of business expenses
  • destroyed or depreciated assets.
Due to the large numbers of businesses receiving insurance settlement payments in Canterbury, we’re working with the insurance industry to help businesses and rental property owners get it right.

Some common mistakes might be not declaring insurance payments as income, not accounting for GST or not returning depreciation recovered when the payment is for a depreciable asset.

To avoid errors, you should keep all records relating to insurance payments for your business or rental property or ask your accountant or tax agent for help with understanding your tax obligations.

To find out more about insurance payments and your business, please email Greg (greg.m@alliott.co.nz) or Vanessa (Vanessa.w@alliott.co.nz) or phone them on +64 9 520 9200.
 

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