By Amanda Morrall (email)
On a personal note, I would like to thank all you readers for the kind and encouraging words, suggestions, comments, corrections, and photos of hunky single (rich) men. On the days when I'd rather look anywhere but a computer screen it keeps me inspired. Truly. May you find your fortune through flow and peace through gratitude.
1) Tax tales from Amanda's file
It's been a while since I've written about taxes. If you're sick of hearing about my rants skip to number two but book mark the links first. If not, here's a little tax tale to amuse.
This morning I spent close to two hours on the phone with the Canada Revenue Agency trying make sense of my messy tax situation which for a year lay dormant because the international tax office lost my file. To cut a long story short, I ended up having to resubmit all the paperwork. At the time I originally submitted my tax file, I sent the CRA a cheque via my accountant. Turns out they lost that too, something I only became aware of this morning when I tried to clarify the remaining amounts owing.
I'd been sent so many computer-generated notices from two different departments that I'd lost the plot. So too had they apparently. The left hand clearly didn't know what the right was doing. After phone calls with two separate divisions of the tax department, I joyfully determined that because they'd failed to take account of my original payment, I'd overpaid.
I had a few questions for them as I tried to untangle this long distance disaster:
Q) Why can't I talk to one person?
A) Because it's a separate department.
Q) What happened to my money, why wasn't it applied to the amount you said was owing before you sent me an invoice?
A) I can't answer that.
Q) When can I expect my refund?
A) You have to write us a letter explaining all of the above and request a refund.
Q) Why can't you accept what I'm saying over the phone and process the repayment, if it's true what you are telling me?
A) That would go against policy.
Q) Where has my money been sitting all this time?
A) In an account, somewhere.
Q) What would have happened to it had I not brought this matter to your attention?
Q) Does none of this not strike you as very disorganised and inefficient?
A) Good point. Hopefully it will be noted.
My hope is to turn the chapter on this tax story from hell before the start of the New Year.
Here's my lessons learned:
- Don't assume the tax department knows what it's doing.
- Don't assume your accountant knows or cares what's going on either.
- Always take the initiative sooner, rather than later, if in doubt.
- Pay your taxes on time.
- Interest only ever works against you when it comes to the taxman. This seems patently unfair.
- Sometimes there is a silver lining, even if you go slowly insane trying to uncover it.
Over payments in NZ taxes are in the millions. By one estimate, NZ$700 million. Make sure you are not owed money. Read more here.
Free money. Here's a bonus link outlining the $55 million in unclaimed money. These are accounts in New Zealand that have been forgotten over the years by members of the public.
2) Good advice
Is financial advice worth it? And can it be quantified?
Tony Vidler, in this blog, looks at the value of getting advice. He refers to some interesting research from Australia.
3) The silly season is upon us
Until it starts snowing in December in New Zealand, I will have to rely upon retail reminders that Christmas is on its way. My Kiwi-Canuck kids seem more attuned to the calendar. How could they not with an advent calendar with chocolate reminders?
This week, unprompted, they both sat down and wrote their letters to Santa. I don't have the heart to tell them Apple hasn't yet taken over the North Pole and therefore Santa's elves won't be making iPods for them, despite how well behaved they were. I'm all for giving but Christmas excess should be saved for the dinner table.
I don't recommend shopping on a credit card. Saving in advance is far more sensible.
4) Lump sum investing
How should you invest a lump sum? The dollar cost averaging approach is one strategy that is recommended.
Forbes Money outlines four rules for investing a lump sum here. Part of it mentions 401ks, self-funded pension schemes in the U.S.
There are no tax incentives (that I'm aware of) for putting a lump sum into KiwiSaver however it is another possibility to explore or ask a financial advisor about.
5) End of year tidy up
Triskaidekaphobia is the fear of No.13. I'm not superstitious. Here's a list of 13 smart things to do before the end of year to help get your financial house in order.
To read previous issues of Take Five click here. You can also follow Amanda on Twitter @amandamorrall