To Professional Service Providers, Opportunity knocks....

With the election completed, we have a new Government in the making. While not everyone will be happy, it seems that the electorates spoke and that there was a clear mandate for Labour to govern alone, although they will likely include the greens.

The real question, however, is what opportunities did this create for you as accountants? Too often we are busy simply doing work to understand opportunities that are knocking at present right in front of us.
As accountants, our jobs are to be proactive and pre-emptive in our work with our clients to assist them to manage their business and personal affairs as best as possible.

Consider the following scenarios:

  1. Labour will bring in a tax rate of 39% post 1 April 2020 for individuals with income over $180,000. Take that as a given.
  2. Have you identified which clients will be affected?
  3. Have you identified which clients own the shares in their companies and businesses personally and not through trusts?
  4. Have you thought about talking to your clients about restructuring these or, at least, creating a significant dividend before 31 March 2021 to clear out imputation credits so they could at least drawdown on a loan and drop their marginal incomes?
  5. Yes, you will need to consider what the IRD may do, but our job is to be proactive and enable clients to make informed decisions. If you don’t contact them and tell them, how can they make any decisions?
  6. So time to get your head out of the work and to start actively looking at how you can help your clients around these and other opportunities.

Personally, I don’t see a wealth tax coming in because I think that Labour sees that as political suicide. They don’t have to take the greens into the government and as a result, the wealth tax is not likely to get up. However, think about what other opportunities there may be for your clients out there in terms of work generation, not only for you but for them.

What business opportunities will a Labour government provide for your clients? Then engage with your clients and discuss.