End of tax year checklist for your New Zealand hair salon: before 31 March

Every autumn, New Zealand salon owners discover that the pages ranking for "end of financial year checklist" were written for tradies, landlords or Australians. The Australian ones are the dangerous kind: a hair salon in Tauranga has no 30 June deadline, no A$20,000 instant asset write-off and no BAS. Your year ends on 31 March, your rules come from Inland Revenue, and the things genuinely worth doing in the last weeks of March are different from everything those articles list.

This is the checklist for a New Zealand hair salon, in the order the jobs actually bite: the money you can still move before 31 March (invoices, bad debts, the stocktake you might legally skip, small equipment, the home-office log), then the two subjects that generate the most 11 pm myIR panic, provisional tax and filing deadlines, both in plain language. It ends with the unglamorous truth that the cheapest tax return is the one your accountant can prepare from clean records, which is where a year of tidy appointment and client data earns its keep; keeping that record costs nothing with a booking system that is free for hair salons and takes no commission.

Two honest lines before the list. First, this is general information checked against official sources in October 2026, not tax advice: your accountant gets the final word on your numbers, and thresholds and dates change. Second, booking software is not accounting software. ViteUneCoupe keeps your calendar and client records; it does not file returns, calculate GST or replace Xero, MYOB or an accountant, and we would rather say that plainly than let you believe otherwise.

What 31 March actually means for your salon

New Zealand's standard income tax year runs from 1 April to 31 March. What the deadline means depends on how your salon is set up:

• Sole trader: the salon's profit is your personal income for the year ending 31 March. You report it on your individual IR3 return and pay tax at personal rates. There is no separate business return.
• Company: the company files its own IR4 return and pays tax at the company rate of 28%, which the 2026 Budget left unchanged (PwC's New Zealand tax summary, checked in October 2026); how you then pay yourself (salary, shareholder salary, dividends) has its own tax treatment.

The structure changes more than the form number: liability, ACC, how losses work, what happens when you sell. Our guide to sole trader versus company for a New Zealand hair salon weighs the choice properly; this article only needs you to know which return carries your salon's year.

Either way, 31 March is a hard line for one reason: expenses and write-offs generally belong to the year in which they happen. A bad debt written off on 2 April, or a pair of clippers bought on 1 April, lands in next year's return, not this one's. That is the whole logic of the checklist below.

The pre-31 March checklist

Work through these in March, not in July when the accountant asks. Most take an evening; together they are the difference between a return built on facts and one built on reconstruction.

Chase the invoices you are owed

Most salon income arrives at the basin, but almost every salon carries some invoiced work: bridal parties, editorial shoots, a corporate event, a chair renter behind on rent. March is the month to chase it, for two reasons. The obvious one is cash. The quieter one is that an invoice still unpaid at 31 March forces a decision: is this money late, or is it gone? Late money gets a reminder email; gone money is the next item.

Write off genuinely bad debts before the year ends

If you have truly given up on an amount someone owes you, the deduction has a hard deadline. Inland Revenue's public ruling on bad debts is explicit: the debt must be actually written off in your books during the income year, with the entries completed before year end, and the amount is deductible only if it was previously returned as income (BR Pub 18/07, Inland Revenue, checked in October 2026). A write-off scribbled in winter while the accounts are being prepared is too late for the March return.

The second condition quietly excludes most salon "debts". A no-show who never paid was never in your income in the first place, so there is nothing to write off: it is simply revenue that never arrived. Bad debt deductions matter for invoiced work, the wedding party that never settled, the renter who left owing a month. If that is you: chase in early March, decide before the 31st, and record the write-off in writing, dated. For the no-shows themselves, the fix is upstream of the tax return entirely; our guide to reducing no-shows in a New Zealand hair salon covers it.

Count the retail shelf, or estimate your way out of it

Retail product and the colour room are trading stock, and the default rule is valuing what you hold at 31 March, because closing stock feeds directly into your taxable profit. But New Zealand has a genuinely useful small-business exemption: if your turnover for the year is NZ$1.3 million or less and you reasonably estimate your closing stock is worth less than NZ$10,000, you may use the same value as your opening stock and skip the stocktake entirely (IRD, valuing trading stock, checked in October 2026).

Read that with a salon owner's eye. A solo chair with a modest retail shelf and a tidy colour cupboard may sit comfortably under NZ$10,000 and legally spend the evening of 31 March at home; note the estimate and how you made it. A salon with a serious retail wall, or one that just took a big March delivery of colour, should count properly: product left on the shelf at 31 March is an asset, not a deduction, which is also why "stocking up before year end for the tax" does not work. You deduct what you used or sold, never what you hoarded. Buy on the colour room's schedule, not the tax calendar's.

Buy small kit before 31 March, but only what you need

New Zealand's version of the famous Australian instant write-off is much smaller: an asset costing up to the NZ$1,000 low-value threshold (GST-exclusive for a GST-registered salon) can be deducted in full in the year of purchase instead of being depreciated (IRD, claiming depreciation, checked in October 2026). Clippers, dryers, a trolley, a reception chair: if the salon genuinely needs it soon anyway, buying before 31 March brings the deduction forward a year. A styling chair or backwash unit over NZ$1,000 is depreciated over several years whichever side of the line you buy it.

The arithmetic every owner should run before "buying a deduction": a deduction reduces taxable income, not your tax bill. A deliberately simplified example for a company at the 28% rate: spend NZ$900 on a gadget the salon does not need and you save NZ$252 of tax while NZ$648 leaves the business for good. The timing is only free money when the purchase was coming anyway.

Log the home office and the car now, not in July

If you run the salon from home, or do colour runs, wholesaler trips and training days in your own car, the claims are legitimate but they live or die on records made at the time. For the home salon, IRD offers a square metre rate or an apportionment of actual costs; our guide to running a home-based hair salon in New Zealand walks through both options with the current figures. For the car, keep a logbook of business kilometres: your accountant applies IRD's kilometre rates to it, and a logbook reconstructed from memory in July is the kind of claim that evaporates under questioning. March is the month to make sure the year's record actually exists.

Check your retail versus service split

Your accountant will ask one question your till should already answer: how much of the year's takings was services and how much was retail product? The split drives your cost of goods sold, your margin analysis and the stocktake decision above, and a salon that rings everything up as one number is paying its accountant to untangle it. If your point of sale or booking records separate a cut-and-finish from the bottle of shampoo sold with it, this line item takes five minutes; if they do not, make fixing that a new-year resolution rather than a March heroic.

Snapshot your gift voucher liability

Every voucher sold and not yet redeemed at 31 March is money you owe in haircuts, not income you have finished earning, and since the March 2026 law change vouchers stay redeemable for at least three years, so the pile only grows. List the outstanding vouchers at year end: numbers, amounts, dates sold. Your accountant needs the figure, and the GST timing on vouchers has rules of its own; our guide to gift voucher rules for New Zealand hair salons covers the law, the GST and the tracking in full.

Provisional tax in plain language

Provisional tax is the subject that turns a good first year into a frightening second one, so here is the mechanism without the jargon, every figure checked on Inland Revenue in October 2026.

When it starts

After your return is processed, the tax you still owe for the year is called your residual income tax (RIT). If that figure is more than NZ$5,000, you become a provisional taxpayer for the following year: instead of one bill after year end, you pay next year's tax as you go, in instalments (IRD, provisional tax, checked in October 2026). For a sole trader, a salon profit in the tens of thousands clears NZ$5,000 of tax comfortably, so most established owners are in.

Under the standard option, each year's provisional tax is simply last year's RIT plus 5%, split into instalments (or the RIT from two years ago plus 10% while the latest return is not yet filed) (IRD, standard option, checked in October 2026). Other options exist (estimation, the accounting income method, a GST ratio) for salons whose income swings; which one fits you is an accountant conversation.

The instalment dates

For a standard 31 March balance date, the three standard instalments fall on 28 August, 15 January and 7 May (IRD, payment dates for provisional tax, checked in October 2026). Notice two cruelties worth planning around. The 15 January instalment lands right after the December rush has been spent on stock, staff and Christmas, in the middle of the January quiet. And the 7 May instalment for one year arrives while you may still owe the balance for the previous year. Put the dates in the calendar now and feed a tax savings account weekly; the owners who treat tax as a percentage of every week's takings never meet the January cliff.

The safe harbour, and the first-year shock

The rule that takes most of the fear out: if your RIT is under NZ$60,000 and you used the standard option, Inland Revenue charges interest only from the day after your end-of-year tax due date, not from the instalment dates (IRD, interest on provisional tax, checked in October 2026). In practice, for almost every independent salon, getting an instalment slightly wrong is not a penalty disaster, though late payment penalties for missing due dates are their own subject: ask your accountant rather than testing it.

The real trap is the first-year shock, and it is timing, not interest. In your first profitable year you pay no provisional tax, because last year produced no RIT. Then the return is filed, and within months you owe the whole of year one's tax and year two's instalments on top. Salon owners call it the double tax year; it is actually the one year of catch-up, but it has broken better cash flows than yours. If this is your first good year, start putting money aside now, in-year, as if provisional tax already applied.

Filing: IR3, IR4 and the accountant's extension

The returns themselves have a simple calendar. An IR3 (sole trader) is due by 7 July after the 31 March year end unless you have an extension (IRD, individual income tax return, checked in October 2026), and a company's IR4 follows the same season. The quiet superpower of using a tax agent: clients of a tax agent get an extension of time to file as late as 31 March of the following year (IRD, extension of time arrangements, checked in October 2026), nearly nine extra months, and the agent's extension also shifts your terminal tax date from 7 February to 7 April.

Two cautions on that comfort. An extension to file is not an extension to care: the pre-31 March actions above cannot be done retroactively, whatever your filing date. And filing late within the extension still means knowing your bill late; many owners prefer filing early precisely so the provisional instalments ahead are based on real numbers rather than the 10% uplift of an old year.

Clean booking records make the accountant cheaper

Accountants do not charge for the size of your salon; they charge for the detective work. A year that lives in a paper diary, two phones and a shoebox costs billable hours to reconstruct. A year that lives in systems is a set of exports:

1. The bank, reconciled to 31 March, every transaction categorised, through one business account.
2. Payroll, finalised, with the year's PAYE filings matching what staff were actually paid.
3. The appointment record. A year of bookings is the story of your revenue: services sold, busiest days, quiet months, no-show rate, how much of the book came in online. It is the sense-check on your reported takings and the raw material for every pricing decision you will make in April. ViteUneCoupe's free plan keeps that record for a hair salon at no cost: unlimited online bookings with 0% commission permanently, your full calendar, service catalogue, staff schedules and a client database where New Zealand +64 mobiles live alongside the colour notes. The Standard plan, from 29 € excluding tax per month with no commitment, adds automatic confirmation, reminder and thank-you emails plus ICS calendar sync. Stated plainly for New Zealand owners: it is billed in euros, so the NZ dollar amount on your statement moves with the exchange rate and your bank may add a foreign-transaction fee (a GST-registered salon can give its GST number under the remote-services rules instead of paying 15% on top); reminders are email only, with no SMS on any plan; and it is a booking system, not accounting software, so it will never produce your GST return or your IR3.
4. The loose ends: asset invoices for anything you want written off or depreciated, the stocktake (or the estimate that replaced it), the voucher list, the bad-debt write-off record, insurance and loan statements.

The subscription itself, whichever tool you use, is a deductible business expense; our breakdown of the real cost of salon software in New Zealand is also, read in reverse, the list of lines your accountant will want receipts for. And if GST is the part of the year-end picture you are least sure about, our plain-language guide to GST for New Zealand hair salons covers registration, returns and the 15% inside your prices.

After 1 April: the new year starts with new rates

The fortnight after 31 March is the one time you hold a complete, honest picture of the salon, and the new year's costs land at exactly the same moment. From 1 April 2026 the adult minimum wage rises to NZ$23.95 an hour (Employment New Zealand, minimum wage rates, checked in October 2026) and the default KiwiSaver employee and matching employer contribution steps up from 3% to 3.5%, on the way to 4% in 2028 (IRD, KiwiSaver changes, checked in October 2026). Wages are most salons' biggest line, so re-cost an hour of chair time with the new numbers and reprice while the year's real figures are one export away; our guide to hair salon prices in New Zealand gives the method. April is also the honest month to audit the subscriptions: anything the salon pays for monthly and used never this year is a standing order to cancel, not a deduction to keep.

And if all of this is homework for a salon that does not exist yet, start one step earlier, with the structure and registrations in our guide to opening a hair salon in New Zealand.

Frequently asked questions

When does the tax year end in New Zealand?

The standard income tax year runs from 1 April to 31 March. A hair salon trading as a sole trader reports the year on the owner's IR3 return; a company files an IR4. Some businesses have non-standard balance dates, but 31 March is the default and by far the most common.

When does a hair salon have to pay provisional tax?

Once your residual income tax, the tax left to pay after a year's return, is more than NZ$5,000, you pay the following year's tax in instalments. For a standard 31 March balance date the standard-option instalments fall on 28 August, 15 January and 7 May, and under the standard option each year's total is last year's residual income tax plus 5%.

Does my salon need a stocktake at 31 March?

Not always. If your turnover for the year is NZ$1.3 million or less and you reasonably estimate your closing stock at under NZ$10,000, Inland Revenue lets you use your opening stock value and skip the count. Keep a note of the estimate. A salon with a big retail wall or a freshly stocked colour room should count properly, because stock on the shelf at 31 March is an asset, not a deduction.

When is my salon's tax return due?

By 7 July after the 31 March year end if you file without an agent. Clients of a tax agent get an extension of time to file as late as 31 March the following year, and their terminal tax date moves from 7 February to 7 April. The extension changes when you file, not what you needed to do before 31 March.

Can my booking software do my tax return?

No, and be wary of anything that implies it can. A booking system like ViteUneCoupe records appointments, services and clients, which answers many of your accountant's questions and is free to keep with 0% commission. The GST return, income tax return and payroll filings belong to accounting software and your accountant. The two work best side by side, not merged.