✨ Childcare Provider Tax Examples
27 MAY 2004
NEW ZEALAND GAZETTE, No. 60
1447
Example 2
A childcare provider rents a domestic property. The rent is $200.00 per week. The childcare provider receives an accommodation supplement of $20.00 per week based on the location of the domestic accommodation and their individual circumstances. Therefore, the domestic accommodation fixed standard-cost that the childcare provider may elect to deduct per annum is:
[($200.00 x 52) – ($20.00 x 52)] x 50% x 33.33% = $1,560.00
Example 3
A childcare provider owns a domestic property, which costs $200,000.00. The childcare provider receives an accommodation supplement of $10.00 per week based on the location of the domestic property and their individual circumstances. The childcare provider provided care for several children in the income year for a total of 1,250 hours. The childcare provider charged an hourly rate of $4.00 and elected to use the standard-cost basis in accordance with Determination DET 001: Standard-Cost Household Service for Childcare Providers.
The childcare provider’s income tax liability is calculated as follows:
| Income | 1,250 hours x $4.00 | $5,000.00 | |
|---|---|---|---|
| Less: | |||
| Variable standard-cost | 1,250 hours x $2.67 | $3,338.00 | |
| $1,662.00 | |||
| Less: | |||
| Fixed standard-cost Domestic accommodation as per Example 1 | $1,580.00 | ||
| Administration and record keeping | $260.00 | $1,840.00 | |
| Taxable income | ($178.00) | ||
| Nil |
Example 4
A childcare provider rents a domestic property for $200.00 per week. The childcare provider receives an accommodation supplement of $20.00 per week based on the location of the domestic accommodation and their individual circumstances. The childcare provider provided care for several children in the income year for a total of 1,250 hours. The childcare provider charged an hourly rate of $4.00 and elected to use the standard-cost basis in accordance with Determination DET 001: Standard-Cost Household Service for Childcare Providers.
The childcare provider’s income tax liability is calculated as follows:
| Income | 1,250 hours x $4.00 | $5,000.00 | |
|---|---|---|---|
| Less: | |||
| Variable standard-cost | 1,250 hours x $2.67 | $3,338.00 | |
| $1,662.00 | |||
| Less: | |||
| Fixed standard-cost Domestic accommodation as per Example 2 | $1,560.00 | ||
| Administration and record keeping | $260.00 | $1,820.00 | |
| Taxable income | ($158.00) | ||
| Nil |
Example 5
A childcare provider owns a domestic property, which costs $250,000.00 and receives no accommodation supplement. The childcare provider provided care for several children in the income year for a total of 3,120 hours. The childcare provider charged an hourly rate of $4.00 and elected to use the standard-cost basis in accordance with Determination DET 001: Standard-Cost Household Service for Childcare Providers.
The childcare provider’s income tax liability is calculated as follows:
| Income | 3,120 hours x $4.00 | $12,480.00 | |
|---|---|---|---|
| Less: | |||
| Variable standard-cost | 3,120 hours x $2.67 | $8,330.00 | |
| $4,150.00 | |||
| Less: | |||
| Fixed standard-cost Domestic accommodation | [($250,000 x 5%) – $0] x 50% x 33.33% | $2,083.00 | |
| Administration and record keeping | $260.00 | $2,343.00 | |
| Taxable income | $1,807.00 |
Example 6
A childcare provider rents a domestic property for $210.00 per week and receives no accommodation supplement. The childcare provider provided care for several children in the income year for a total of 3,120 hours. The childcare provider charged an hourly rate of $4.00 and elected to use the standard-cost basis in accordance with Determination DET 001: Standard-Cost Household Service for Childcare Providers.
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Online Sources for this page:
VUW Te Waharoa —
NZ Gazette 2004, No 60
Gazette.govt.nz —
NZ Gazette 2004, No 60
✨ LLM interpretation of page content
💰
Commentary on Determination DET 001
(continued from previous page)
💰 Finance & RevenueChildcare Services, Standard-Cost Basis, Actual-Cost Basis, Income Tax, Consumers Price Index, GST, Domestic Property, Accommodation Supplement