Entertainment Expense Items

November 26, 2025

 ENTERTAINMENT EXPENSE ITEMS

           

 A list of common travel and entertainment expense items and their tax treatment

             

 - Food and drink while out of town on business when eating alone or with other team members 100% deductible and no FBT

 - Food and drink while overseas on business eating with team members, customers, suppliers, prospects etc. 100% deductible and no FBT

 - Food and drink with customers, suppliers, prospects etc. either in or out of town on business 50% deductible and no FBT


 - Non-taxable meal allowances paid to employees working overtime 100% deductible and no FBT

 - Morning and afternoon teas 100% deductible and no FBT

 - Lunches and more than incidental food & beverages for employees 50% deductible and no FBT


 - Samples provided for advertising 100% deductible and no FBT

 

 - Food & beverages as part of training seminars, conferences, trade displays that are at least 4 consecutive hours 100% deductible and no FBT


 - Rugby, show, movie tickets etc. for staff and used when staff member chooses 100% deductible and subject to FBT*

 - Sporting, cultural or other recreational activities, e.g. golf or corporate box 50% deductible and no FBT


 - Hire of boat to entertain customers, suppliers, prospects etc. 50% deductible and no FBT


 - Friday night drinks, staff parties and other social functions (whether at the office or elsewhere) e.g. Christmas parties, reception for existing or potential customers, suppliers etc. This includes any supporting expenses i.e. transport (taxis), crockery hire, glasses, waiters, music, etc. 50% deductible and no FBT


 - Gift for client, employee, supplier etc. which contains food and drink 50% deductible and no FBT

 - Gift for client, excluding food and drink 100% deductible and no FBT

 - Gifts for employees (or spouse) 100% deductible and subject to FBT*

 - Gift for non employee who helped with job 100% deductible and no FBT

 - Gym membership for an employee paid by the employer 100% deductible and subject to FBT*

 - Vouchers (no GST claim as GST triggered when voucher used) 100% deductible and subject to FBT*

                 

* You are only subject to FBT if you are over the exemptions. These are $300 per quarter per employee, or $22,500 per annum for all employees. If you reach either of these in any period, you are required to pay FBT on the total amount. Note there is a $1,200 per employee per annum threshold if you are filing FBT on an annual basis.

             

This list is designed to be an overview of the tax treatment of common entertainment expenses. If you have a question relating to this list, or you have another expense you would like clarification on, please contact us.

             

GST is not claimable on 50% portion.

Employment Relations Amendment Bill

By Stuarts Accountants • August 19, 2025
Key Proposed Changes 1. “Specified Contractor” Gateway Test The Bill proposes a clearer test to distinguish independent contractors from employees. If all of the following criteria are met, a worker qualifies as a specified contractor, and is excluded from the legal definition of an "employee": 1. A written agreement specifies they are an independent contractor. 2. They are not restricted from working for others (except when engaged with the contracting party). 3. They are not required to work at specified times or days, or can subcontract their work (subject to vetting/statutory compliance). 4. The contract does not terminate if the contractor declines additional work. 5. The contractor had a reasonable opportunity to obtain independent advice before entering into the arrangement. Implications: This aims to increase business flexibility and clarity. Contractors who meet the test cannot challenge their status in the Employment Relations Authority or Courts. 2. Remedy Assessment in Personal Grievances The Bill would narrow remedies available in personal grievance cases if the employee is found to have: * Committed serious misconduct (no remedies available). * Contributed to the grievance situation (no reinstatement or compensation for hurt, humiliation, or loss of benefit; other remedies may still apply but can be reduced by up to 100%). * Additionally, adjudicators (Authority or Court) must consider whether the employee’s conduct impaired the employer’s ability to act fairly, and raise the bar for procedural error claims. 3. High-Income Threshold for Unjustified Dismissal Claims Employees earning over NZD 180,000 per annum (base salary only—excluding bonuses, allowances, commissions, overtime, superannuation) would not be eligible to raise personal grievances for unjustified dismissal —unless they explicitly opt in via their employment agreement. * Key details: * A 12-month transitional period will apply for existing employees (unless they opt in earlier). * The income threshold will automatically adjust annually based on average weekly earnings, which introduces complexity in ongoing compliance. 4. End of the “30-Day Rule” for Collective Agreements * The “30-day rule”—which required terms of a collective agreement to apply to new employees for their first 30 days before they could move to an individual agreement—is to be repealed. * Under the proposed change: * Employers would provide new employees with information about collective agreements and unions. * Employees can immediately choose to sign an Individual Employment Agreement (IEA), which may include a **90-day trial period** if agreed. Additional Context & Commentary * Intent and Government Rationale: The Bill is positioned by the Government as a means to enhance labour market flexibility, reduce compliance costs, boost business innovation, and rebalance employer-employee interests, particularly in the personal grievance sphere. * Current Status: As of July 2025, public submissions were open (closing 13 August 2025), and the Bill was advancing through the select committee and readings. * Notably, in June 2025 the Parliament rejected amendments proposing to delay commencement to June 2026, keeping an earlier timeline —perhaps December 2025—for enactment. Summary Table Key Change - Description & Effects “Specified Contractor” Test - Workers meeting five criteria are excluded from employee status—limiting legal challenges Remedy Restrictions - Serious misconduct or employee contribution reduces or eliminates remedies $180,000 Threshold - High-earning employees excluded from unfair dismissal claims unless they opt in Repeal of 30-Day Rule - Allows immediate use of IEAs and 90-day trials for new hires, bypassing collective terms What to Watch Next Select Committee Process: Ongoing debates, public submissions, and possible amendments. Threshold Adjustments: Details on how the automatic salary threshold updates will work. Implementation Timeline: While December 2025 is possible, it depends on the legislative process and Royal Assent.  Sources: [1]: https://www.bellgully.com/insights/the-employment-relations-amendment-bill-has-landed-and-it-has-the-potential-to-transform-employment-relations-in-new-zealand/?utm_source=chatgpt.com "The Employment Relations Amendment Bill has landed" [2]: https://www.dentons.co.nz/en/insights/articles/2025/june/19/employment-relations-amendment-bill-2025?utm_source=chatgpt.com "Employment Relations Amendment Bill 2025" [3]: https://www.laneneave.co.nz/news-events/era-four-key-changes/?utm_source=chatgpt.com "Explained: Employment Relations Amendment Bill" [4]: https://www.parliament.nz/en/pb/hansard-debates/rhr/combined/HansDeb_20250624_20250625_52?utm_source=chatgpt.com "Employment Relations (Pay Deductions for Partial Strikes) ..." [5]: https://knowledge.dlapiper.com/dlapiperknowledge/globalemploymentlatestdevelopments/2025/significant-amendments-to-the-employment-relations-act?utm_source=chatgpt.com "Significant amendments to the Employment Relations Act" [6]: https://www.lexology.com/library/detail.aspx?g=b905b99b-6503-4444-b0a3-be27a0d206fa&utm_source=chatgpt.com "Key insights into the new Employment Relations ..." [7]: https://www.parliament.nz/en/pb/sc/committees-press-releases/public-submissions-open-on-the-employment-relations-amendment-bill/?utm_source=chatgpt.com "Public submissions open on the Employment Relations ..." [8]: https://www.mbie.govt.nz/dmsdocument/30958-employment-relations-amendment-bill-2025-approval-for-introduction-proactiverelease-pdf?utm_source=chatgpt.com "Employment Relations Amendment Bill 2025: Approval for ..." [9]: https://www.humankind.nz/blog/an-update-on-employment-law-changes?utm_source=chatgpt.com "An update on employment law changes - Humankind NZ"

Income Protection Insurance

By Stuarts Accountants • May 22, 2025
What is Income Protection Insurance? Your income is often your biggest asset and losing it can turn life upside down. If you’re unable to work—either temporarily or permanently—because you’re sick or injured, Income Protection Insurance will provide you with money to live on as a monthly payment while you’re not receiving your salary or wage. Income Protection Insurance benefits: Income support Pays you a monthly benefit if you’re unable to work because of illness or injury Rehabilitation & retraining support Helps you with your rehabilitation and retraining costs Recurrent disability Pays you a monthly benefit if you suffer the same sickness or disability within a year Return to work Pays you a bonus benefit if you are able to return to work Family assist We’ll pay for a nurse or family member to look after you at home for up to 6 months Accommodation support Pays for your family to be with you if they live more than 100km away Disability reset Allows you to claim again if you suffer a related sickness or injury Elective surgery Pays you a monthly benefit if you are disabled due to an elective surgery Payment while overseas Pays you a monthly benefit if you are disabled while overseas Funeral assistance We reimburse your family up to three times the monthly benefit for your funeral costs if you die Grief support Helps with the cost of professional grief support to cope with sudden changes Overseas assist Reimburse you and one support person for travel back to New Zealand if disabled overseas New parent premium waiver We’ll pay your premiums for six months while you’re on parental leave Ref: Asteron Life

Shareholders Agreements

By Stuarts Accountants • May 22, 2025
What is a shareholders’ agreement? A shareholders’ agreement is essentially a contract between company shareholders. It regulates and guides decision-making. Shareholder agreements deal with matters such as: Who the company directors and shareholders are (plus their rights and responsibilities) Voting rights (i.e. which shareholders – or what percentage of shareholders – need to approve various activities and transactions) Restraints of trade that apply to directors and shareholders Sale of company assets Funding, guarantee and insurance arrangements Shareholder agreements also provide a process for complicated situations, for example: Where one of the shareholders dies or becomes totally and permanently disabled If a shareholder-employee leaves employment of the company Where one of the shareholders wants to sell their shares If a dispute crops up between shareholders Shareholder agreements bind shareholders to the agreed terms. They also provide guidance when navigating business issues that aren’t covered by the Companies Act 1993. A shareholders’ agreement can be prepared for a new company or an established business that has traded extensively. If necessary, the agreement can be amended to account for company growth and capital funding Why prepare a shareholders’ agreement? Shareholder agreements aren’t mandatory, but we strongly advise having one. As with all relationships, a business relationship is likely to have its ups and downs. To demonstrate the importance of a shareholders’ agreement, let’s consider an example scenario where an agreement would be helpful: Two business partners form a company as 50/50 shareholders. They decide not to enter into a shareholders’ agreement. The pair successfully trade for several years and enjoy a healthy working relationship, managing company affairs as a team and resolving disputes amicably. Shareholder A dies suddenly. Without a shareholders’ agreement in place, Shareholder A’s 50% shareholding transfers to his wife by virtue of survivorship. His wife is now an equal shareholder of the company. The Companies Act 1993 doesn’t cover this type of situation, so Shareholder A’s wife isn’t obliged to sell her shares to Shareholder B. The company continues to trade while Shareholder A’s wife enjoys the fruits of the company’s success, without materially contributing to the running of the business. A tailored shareholders’ agreement can determine a share sale procedure in the event of shareholder death or incapacitation, ensuring a fair outcome for everyone involved. Most people enter into business arrangements thinking they’ll always be able to work through issues amicably. Unfortunately, that isn’t always the case, particularly when the personal relationship becomes difficult or if one of the shareholders dies and suddenly the remaining shareholders are finding themselves dealing with the deceased person’s family or representatives. A shareholders’ agreement can help you reach a satisfactory resolution to problems efficiently and at minimal cost, compared to the cost of trying to resolve issues without a shareholders’ agreement. Ref: 1 August 2022 • Commercial law