Geekzone: technology news, blogs, forums
Guest
Welcome Guest.
You haven't logged in yet. If you don't have an account you can register now.


jpoc

1043 posts

Uber Geek


#248007 6-Mar-2019 16:07
Send private message

I have a lot of experience working as an IT contractor in various countries in Europe but here in NZ, I have only ever been an employee.

 

I am in discussion with a potential client regarding a likely 6 month contract.

 

I would be on an hourly rate and be paid after submitting invoices.

 

None of that is new to me but as I mentioned above, I have not done this in NZ.

 

Who can I talk to or where can I ask all of the obvious questions that I have.

 

Any suggestions?

 

TIA

 

 


View this topic in a long page with up to 500 replies per page Create new topic
 1 | 2
Dynamic
3866 posts

Uber Geek

ID Verified
Trusted
Lifetime subscriber

  #2192398 6-Mar-2019 16:21
Send private message

Hit us with the big questions?  Lots of experience here that can be drawn upon, though curlier stuff may result in a suggestion to chat to an accountant or lawyer.





“Don't believe anything you read on the net. Except this. Well, including this, I suppose.” Douglas Adams

 

Referral links to services I use, really like, and may be rewarded if you sign up:
PocketSmith for budgeting and personal finance management.  A great Kiwi company.




nzkc
1571 posts

Uber Geek


  #2192407 6-Mar-2019 16:31
Send private message

As said already.... fire them here.  You'll probably get the most honest answers from this forum.

 

I have been a contractor in NZ.  Long story short: Its easy to do - finding work will depend on you though you say you're most of the way there.  I'd say make sure you've got indemnity insurance as I had to often prove and provide this.  There's a few models you can follow and the best advice would be to chat to an accountant about these.  Personally I set myself up a GST registered company and did it that way.  Very trivial to do in NZ.


antoniosk
2358 posts

Uber Geek

ID Verified
Trusted
Lifetime subscriber

  #2192415 6-Mar-2019 16:45
Send private message

Its boring I know, but:

 

From MBIE
https://www.business.govt.nz/starting-a-business/

 

 

 

From IRD
https://www.ird.govt.nz/yoursituation-bus/starting/business-starting-index.html

 

Consider where you are going to operate (Wellington, which is heavily public sector for example) and be ready to meet the requirements for the employers.

 

 

 

Also important:

 

https://www.ird.govt.nz/news-updates/contractor-changes.html

 

Contractors might be subject to deductions at source if you work through a labour hire company - an agency - but forwarned is forearmed.

 

 

 

 

 

 





________

 

Antoniosk




amanzi
Amanzi
1292 posts

Uber Geek

ID Verified
Trusted
Lifetime subscriber

  #2192416 6-Mar-2019 16:47
Send private message

Definitely get yourself an accountant. Others here may be able to provide recommendations, I've been out of the contracting game for a few years now. But getting an accountant that you can talk to regularly is important - don't try and do it yourself, you'll either pay more than you need to, or miss important taxes you need to pay. And watch out for the provisional tax! (the accountant will explain further.)


scetoaux
56 posts

Master Geek


  #2192452 6-Mar-2019 18:00

amanzi:

Definitely get yourself an accountant. Others here may be able to provide recommendations, I've been out of the contracting game for a few years now. But getting an accountant that you can talk to regularly is important - don't try and do it yourself, you'll either pay more than you need to, or miss important taxes you need to pay. And watch out for the provisional tax! (the accountant will explain further.)

 

 

Totally agree. A good accountant will pay for themselves (plus some) in what they save you.

mdf

mdf
3512 posts

Uber Geek

Trusted

  #2192460 6-Mar-2019 18:14
Send private message

You can do it yourself so long as you take the time to learn the rules and be disciplined about the requirements. For less than one year, it's more straightforward, since provisional tax etc. almost always only kicks after your first year in business.

 

If you can't/won't/don't want to do it yourself, an alternative to an accountant is a service like Hnry. Basically you do everything through their platform, and they will take care of all the accounting and tax requirements, including deducting the IRD's share and paying you the remainder. Kind of a hybrid employee/contractor service.

 

Professional advice will still be helpful upfront to help you sort out any risks/concerns about liability and structure (do you need/want a company? Professional Indemnity insurance? Stick your house in a trust? Professional accreditation/certification etc.?


irongarment
280 posts

Ultimate Geek
Inactive user


  #2192511 6-Mar-2019 19:40
Send private message

Don't be afraid to talk to the IRD (in fact, you really ought to). I actually had a guy come out to talk to me and explain everything. He explained how it all worked, including registering for GST (because I was expecting to be over the threshold).

 
 
 

Cloud spending continues to surge globally, but most organisations haven’t made the changes necessary to maximise the value and cost-efficiency benefits of their cloud investments. Download the whitepaper From Overspend to Advantage now.
timmmay
20574 posts

Uber Geek

Trusted
Lifetime subscriber

  #2192515 6-Mar-2019 19:55
Send private message

I contracted for years, and had an accountant. If all your income for the year is contract income, you don't have overseas income, and you have nothing complex like a claim for home office expenses you don't need them. However, they can be good peace of mind. I just got rid of mind, though a friend who's an accountant will help me out. I only ever spoke with my account at tax time.

 

The main tip I have is to use Xero. Saves you time, saves your accountant time, so saves you money.

 

Accountant costs about $1000 per year for just doing tax returns, if you have Xero.


timbosan
2159 posts

Uber Geek


  #2192554 6-Mar-2019 21:04
Send private message

I've spent most of the past 20 years contracting in IT in NZ, having had my own company, sole trader, and partnerships at various times.  Happy to answer any questions, but in the meantime here are some things I have found to be important:

1) Get an accountant.  Yes you can do it yourself (I have a friend who just pays the full tax rates whilst contracting, claiming nothing, and she's happy with that) but its best to get food advice.  Plus accountant fees are claimable and I always manage to claim something each month

2) Register for GST.  I highly doubt you will earn < $60,000 in a year, so just do it.  Then charge GST on your invoices

3) A sole trader situation is fine (unless you are contracted directly by some of the bigger companies); agencies don't mind

4) Get indemnity insurance.  Most agencies will deduct the cost from your hourly rate

5) Go for the 2 monthly GST return option and don't spend your GST!  Do this from day 1 and it makes life easy.

6) Use a separate bank account for business stuff, including the income from your invoices

7) You will, by default, have 20% of your pre-GST income taken as withholding tax.  You can change this to be higher or lower.  it will make end of year tax payments much easier.





ANglEAUT
2320 posts

Uber Geek

Trusted
Lifetime subscriber

  #2192598 6-Mar-2019 21:58
Send private message

irongarment: Don't be afraid to talk to the IRD (in fact, you really ought to). I actually had a guy come out to talk to me and explain everything. He explained how it all worked, including registering for GST (because I was expecting to be over the threshold).

 

https://www.ird.govt.nz/contact-us/seminars/auckland/

 

🤪 Forgive me, I am biased (Auckland based)





Please keep this GZ community vibrant by contributing in a constructive & respectful manner.


irongarment
280 posts

Ultimate Geek
Inactive user


  #2192643 6-Mar-2019 22:15
Send private message

ANglEAUT:

irongarment: Don't be afraid to talk to the IRD (in fact, you really ought to). I actually had a guy come out to talk to me and explain everything. He explained how it all worked, including registering for GST (because I was expecting to be over the threshold).


https://www.ird.govt.nz/contact-us/seminars/auckland/


🤪 Forgive me, I am biased (Auckland based)


Ah, it's different for you sophisticated city-types.

dzh

dzh
50 posts

Geek

Trusted

  #2192651 6-Mar-2019 22:30
Send private message

nzkc:

 

As said already.... fire them here.  You'll probably get the most honest answers from this forum.

 

I have been a contractor in NZ.  Long story short: Its easy to do - finding work will depend on you though you say you're most of the way there.  I'd say make sure you've got indemnity insurance as I had to often prove and provide this.  There's a few models you can follow and the best advice would be to chat to an accountant about these.  Personally I set myself up a GST registered company and did it that way.  Very trivial to do in NZ.

 

 

Interesting. Ever had to use your indemnity insurance?


dejadeadnz
2394 posts

Uber Geek
Inactive user


  #2192691 6-Mar-2019 22:41
Send private message

I have managed major suppliers/been a decision maker on contract templates (alongside legal and sometimes procurement) for multiple listed companies. I am only speaking from the perspective of large corporates and frankly don't particularly care for small/medium size companies (never worked for one and never would want to). Contrary to popular belief, large corporates aren't as lawsuit happy as people make them out to be (one place I worked at did win a major dispute with a small IT consultant). However, you're simply not going to get past prequalification if you do not hold suitable PI and PL policies, simply because anyone who tries to engage you (short of being a GM, GGM or above) will find themselves up against somebody in commercial, procurement, legal and/or risk. And there's usually only one likely winner in those cases.

 

The lack of such policies or gross under-insurance will very quickly lead to suspicion that you aren't in-line with the culture/thinking of these places. 

 

 

 

 


marpada
475 posts

Ultimate Geek


  #2192703 6-Mar-2019 22:54
Send private message

dzh:

 

Interesting. Ever had to use your indemnity insurance?

 

 

Doesn't really matter, agencies usually require the contractor to have a indemnity insurance with a certain insured amount (and will offer to provide you one for an hourly fee)


dejadeadnz
2394 posts

Uber Geek
Inactive user


  #2192707 6-Mar-2019 22:58
Send private message

I should also add that people need to think about insurance in a more sophisticated way than just "How likely can someone make our a case against me?". Depending on your scope of work and how robust your engagement terms are (but watch out for the problem of trying to exclude everything and risk shift everything to the client - people with a brain just won't go near you), your ultimate risk of being successfully sued may vary. But I can't stress this enough: just the threat of being gone after by a large entity -- with basically unlimited money to spend and the ability to access the best lawyers and professional witnesses that money can buy -- without any kind of insurance backup is scary and stupid. And don't assume that just because you provide advisory services, you won't need PL insurance. If you work on client sites or touch client's equipment, you should get PL, the cost of which is generally rather inconsequential compared to PI. Just amortise the costs into your hourly rates.

 

 

 

 

 

 


 1 | 2
View this topic in a long page with up to 500 replies per page Create new topic





News and reviews »

Air New Zealand Starts AI adoption with OpenAI
Posted 24-Jul-2025 16:00


eero Pro 7 Review
Posted 23-Jul-2025 12:07


BeeStation Plus Review
Posted 21-Jul-2025 14:21


eero Unveils New Wi-Fi 7 Products in New Zealand
Posted 21-Jul-2025 00:01


WiZ Introduces HDMI Sync Box and other Light Devices
Posted 20-Jul-2025 17:32


RedShield Enhances DDoS and Bot Attack Protection
Posted 20-Jul-2025 17:26


Seagate Ships 30TB Drives
Posted 17-Jul-2025 11:24


Oclean AirPump A10 Water Flosser Review
Posted 13-Jul-2025 11:05


Samsung Galaxy Z Fold7: Raising the Bar for Smartphones
Posted 10-Jul-2025 02:01


Samsung Galaxy Z Flip7 Brings New Edge-To-Edge FlexWindow
Posted 10-Jul-2025 02:01


Epson Launches New AM-C550Z WorkForce Enterprise printer
Posted 9-Jul-2025 18:22


Samsung Releases Smart Monitor M9
Posted 9-Jul-2025 17:46


Nearly Half of Older Kiwis Still Write their Passwords on Paper
Posted 9-Jul-2025 08:42


D-Link 4G+ Cat6 Wi-Fi 6 DWR-933M Mobile Hotspot Review
Posted 1-Jul-2025 11:34


Oppo A5 Series Launches With New Levels of Durability
Posted 30-Jun-2025 10:15









Geekzone Live »

Try automatic live updates from Geekzone directly in your browser, without refreshing the page, with Geekzone Live now.



Are you subscribed to our RSS feed? You can download the latest headlines and summaries from our stories directly to your computer or smartphone by using a feed reader.