In accordance with its original announcement, the Government is increasing the amounts of expenditure on some business expenses that businesses are permitted to have pre-paid at balance date without affecting the tax deduction for expenditure. The items that have had the limit increased for the 2009/2010 tax years onwards are as follows:-
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Rental for the lease of land relating to a period ending more than one month after balance date: $26,000 (previously $23,000) - provided it is consumed within six months (unchanged);
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Rental for the lease or bailment of livestock or bloodstock: $26,000 (previously $23,000) - provided it is consumed within six months (unchanged);
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Costs for services, other than those otherwise specified (in the IRD Determination E12): $14,000 (previously $12,000) - provided it is consumed within six months (unchanged);
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Periodic charges, other than those otherwise specified (in the IRD Determination E12): $14,000 (previously $12,000) - provided it is consumed within six months (unchanged);
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Advanced bookings for travel and hotel or motel accommodation: $14,000 (previously $12,000) - provided it is consumed within six months (unchanged);
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Cost of advertising: $14,000 (previously $12,000) - provided it is consumed within six months (unchanged).
This is a small measure that is unlikely to have a huge impact on businesses.
