At Construction Accounting, we specialise in helping electricians reduce tax liabilities, optimise business performance, and navigate complex tax requirements. Our personalised approach ensures that electricians can focus on their core business operations while we handle the intricacies of financial management. With our expert guidance and tailored strategies, electricians can confidently pursue their financial goals and build long-term wealth. Explore how Construction Accounting can empower your electrician business to thrive financially.
Grow your business and increase your personal wealth
Reduce your tax through industry tax reduction techniques
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At Construction Accounting we specialise in providing tailored accounting solutions and expert guidance to help electricians reduce their tax obligations and improve their financial management.
Electrical companies are obligated to pay income tax on profits, calculated by subtracting business expenses from income and provisional tax may be required, reflecting your estimated future income tax paid in advance. If their taxable supplies exceed $60,000 annually, they must register for GST, collecting and remitting it to the IRD. PAYE obligations arise when employing staff, necessitating tax deductions from employees' wages. Additionally, providing fringe benefits may incur Fringe Benefit Tax.
Compliance with these tax obligations is vital, and seeking guidance from professionals can ensure adherence to regulations while minimising tax burdens for electrical businesses.
Electricians can minimize tax liabilities through strategic planning and leveraging industry-specific deductions. Construction Accounting offers tailored strategies such as maximizing deductions for equipment and vehicle expenses, taking advantage of tax credits for energy-efficient upgrades, and structuring business operations to optimize tax efficiency.
Our expertise in tax law and industry-specific deductions enables electricians to maximize their tax savings. By understanding the unique tax landscape for electricians and implementing targeted strategies, Construction Accounting helps minimize tax burdens while ensuring compliance with regulations.
Through personalised financial strategies and expert guidance, we empower our clients to build personal wealth. Construction Accounting provides tailored solutions such as maximizing tax efficiency, optimising business operations for profitability, and implementing investment strategies aligned with individual goals. By understanding our clients' unique financial circumstances and aspirations, we offer comprehensive support to grow their wealth over time. Whether it's minimising tax liabilities, identifying opportunities for wealth accumulation, or providing strategic advice on asset management, our dedicated team is committed to helping clients achieve long-term financial success and security. With Construction Accounting, building personal wealth becomes a tangible reality
An electricians set of accounts must be aligned with their revenue and expense activities.
As with all construction accounting, when designing a set of accounts for an electrical company we need to identify the revenue streams that have direct costs associated to them. We can get this information from your quotes and past jobs. We also need to identify any other major revenue streams that we would like to identify separately.
Once we have set up your income accounts we then create the accounts for the direct costs associated with deriving revenue. This is a great way to ensures all of your business operations are individually profitable. For example, you may be adding a margin to materials, having the income and costs identifiable will allow you to check at the end of the month whether or not these margins are actually being recognised as your business goes about it's operations.
Lastly we want to ensure that no other variable costs are sitting in our overheads section and vice versa. Commonly we find that management salaries have not been pulled apart from the operating wages. This must be done to ensure a correct reading of the accounts.
This completes the top half of the income statement and the gross profit, this will give you some good insights into the company.
Different forms of profit, tracking categories, and timing are discussed below.
We like to show different levels of profit, typically most statements might have net profit and profit after tax. However another good figure is you operating profit or EBITDA. This shows the companies performance before the current ownership structures costs, this can have better comparability over time as the companies capital structure changes.
Timing is the last key issue for electricians, we must do our best, sometimes creatively, to align the revenue streams with the costs otherwise we risk throwing out our gross profit. Typically what happens is an electrician would receive an invoice from their supplier but not be at a stage to invoice their client. In most cases we can get around this even if you have to create a separate expense account for these situations.
Further breakdown of the income statement can also be achieved through tracking categories, most accounting systems have this extended feature. This is not represented in the above example as it is even more company specific. We do however believe that most construction companies should be utilising this feature.