Compliance has been identified as one of the key pressures on SMEs in the hospitality sector as they face a raft of requirements to keep pace with. These range from tax and employment regulations to strict food, hygiene and alcohol laws, all of which can be difficult for hard-working business owners to keep on top of.
MYOB executive director, Scott Gardiner, says one of the most important steps you can take to ensure success within the hospitality industry is to stay up-to-date with current legislation, especially when planning for a new financial year.
“It can sometimes be difficult to keep on top of new legislation, especially as this regularly changes. But if you haven’t already, now is the perfect time to consult with your accountant or financial advisor to implement the changes so that you can set yourself up for the year ahead,” says Mr Gardiner.
The nature of the hospitality sector means businesses within the industry are more likely to have a higher turn over of staff, making understanding the new payroll regulations imperative.
“This financial year, there have been a number of changes to payroll regulations from KiwiSaver contribution rates to ACC levy rates. Whether you employ permanent staff, or hire temps as you need them, you need to ensure you are paying all employees correctly, otherwise come the end of financial year you’ll land in hot water, both with your staff and the IRD,” says Mr Gardiner.
“To ensure your operation is compliant, make sure your accounting and payroll software is up-to-date. MYOB software is designed to keep pace with legislative changes and updates are usually available before the end of financial year.”
According to MYOB’s latest Business Monitor results, 38% of the retail and hospitality sector saw a decline in revenue last year, while just over quarter of respondents (29%) experienced an increase.
The sector also saw significant pressure from competitive activity, cash flow, price margins and profitability.
“While some sectors have seen improvements over the last year, those within the hospitality industry have continued to face a challenging trading environment,” says Mr Gardiner.
“With many pressures facing this industry, understanding new changes and implementing them as soon as possible will leave owners more time to focus on other aspects of their business.”
Laws pertaining to alcohol will be changing in December and changes to food standards are also in the pipeline. This new legislation will affect compliance requirements and will particularly impact SMEs.
“Working with an accountant now will enable businesses to implement tailored strategies to ease the transition and minimise the impact of any rising costs,” says Mr Gardiner. “It will also mean that your business will have the advantage of being prepared for these new legislative changes.”
To avoid creating further stress, business owners within the sector should work with their financial advisor to put in place a comprehensive business plan taking into account the all of the changes.
Payroll changes that came into affect on 1 April include:
- Minimum contribution rate for KiwiSaver members will increase from 2% to 3%
- ACC Levy payment threshold will increase
- ML and ML SL tax codes are being phased out
- Child tax rebates will change
- Student loan repayment deductions will increase from 10 cents to 12 cents
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About MYOB New Zealand
Established in 1991, MYOB is New Zealand's largest business management solutions provider. It makes life easier for approx. 1.2 million businesses across New Zealand and Australia, by simplifying accounting, payroll, tax, practice management, CRM, websites, job costing, inventory and more. MYOB provides ongoing support via many client service channels including a network of over 40,000 accountants, bookkeepers and other consultants. It is committed to ongoing innovation, particularly in cloud computing solutions, and now spends more than NZ$35 million annually on research and development. In 2013, MYOB expanded its offerings with the acquisition of accounting solutions provider BankLink. For more information, visit myob.co.nz.
About the MYOB business monitor
The MYOB Business Monitor is a national survey of 1,000+ New Zealand small and medium business owners and managers, from sole traders to mid-sized companies, representing the major industry sectors. It has run since 2009, commissioned to independent market research firm Colmar Brunton. This most recent survey ran late January/early February 2013. The Monitor researches business performance and attitudes in areas such as profitability, cash flow, pipeline, technology usage and the government. The weighting of respondents by both geographical location and sector is based on overall market proportions as established by Statistics New Zealand and is drawn from an independent survey group, which includes both MYOB clients and non-clients.