Climate Change

20 February 2022

Aotearoa committed to the international global agreement to take action on climate change under the Paris Agreement which came into force in late 2016 and took effect from 2020. Under this agreement we have committed to halving our current net greenhouse gas emissions by the year 2030. To help meet this target, our primary industry will be required to measure and manage its greenhouse gas emissions or be introduced into the Emissions Trading Scheme (ETS). Doing nothing is not an option – the Government has already decided to price agriculture emissions. As a primary industry we need to be proactive so that any scheme developed has our input and is entered into on our terms.


A Primary Sector Climate Action Partnership – He Waka Eke Noa – has been formed between the government, Iwi and primary industry to reduce agricultural emissions. This partnership is our industry’s best opportunity to design a sustainable alternative to the NZETS, for farmers and growers to report, manage and reduce their agricultural emissions.


This partnership, which is in its second year, is creating a practical framework in which agriculture, horticulture and arable farms will account for their emissions and adapt to climate change.


This includes: 

  • a pricing system for agricultural greenhouse gas emissions as an alternative to the ETS;
  • a system for reporting on-farm emissions;
  • an approach for recognising on-farm sequestration; and
  • farm planning guidance and other supporting research and extension activities.


However, in order for the government to accept this framework and a suggested pricing mechanism, the partnership must meet a number of milestones. If the legislated milestones aren’t being met, the Government can bring agriculture into the ETS at the processor level before 2025. If the farm-level pricing system is not in place by 2025, agriculture will come into the ETS at the processor level. 


These milestones, and the dates they must be met by, are:


31 December 2021         

25% of farms must know their annual total on-farm greenhouse gas emissions – “your number”.


1 January 2022                 

25% of farms must have a written plan in place to measure & manage their greenhouse gas emissions.


31 December 2022         

100% of farms must know their annual total on-farm greenhouse gas emissions.


31 December 2024         

100% of farms must have a written plan in place to measure & manage their greenhouse gas emissions.


1 January 2025                 

100% of farms are using the accounting and reporting systems to report their 2024 emissions. 


The partnership has defined a farm for this purpose as:

  • all farms over 80ha (includes pastoral, horticultural, arable);
  • all dairy farms with a milk supply number; and
  • all feedlots. 


This captures around 25,000 farms. It is important to note that this is not a final definition of a farm. For the purposes of pricing agricultural emissions, properties that are outside of this current definition may still be included in the scheme.


What is “your number”?


If you haven’t already, now is a good time to find out what your annual total on-farm greenhouse gas numbers are. You will have to know this information by December 2022. 


There are 10 assessed greenhouse gas calculators available: Farmax, Overseer, Beef + Lamb NZ GHG Calculator, Fonterra/AIM, Hort NZ, Foundation for Arable Research, Ministry for the Environment (MfE), Alltech, E2M and Toitū. These systems all vary in complexity & level of detail, and which one you use will depend on what part of the industry you are in.


These models require data to be entered relating to livestock numbers and movements, fertiliser use, cropping practices and vegetation areas able to be offset to mitigate your greenhouse gas outputs. This may seem overwhelming but you are surrounded by an advisory team that can help you: Dairy NZ, Beef + Lamb NZ, Horticulture NZ, FAR, your bankers, consultants and accountants. 


It is essential that the He Waka Eke Noa partnership is successful in ensuring NZ farming isn’t forced into the ETS at a processor level. Being able to account for your emission mitigations at a farm level will help to reduce the cost to your farm business. He Waka Eke Noa is also recommending that revenue generated from greenhouse gas pricing is recycled back into research and development in the agricultural sector which will further help to reduce emissions.


We are here to help you work out the requirements you need to meet. Call us at any time.

The art of delegation

11 August 2025
How often do you get to the end of a working day and wonder where the time went? Perhaps you never got to item 3 (or even item 1!!) on your to-do list. How can you solve this problem without working longer hours? The answer is very simple, but the art in the solution is where the gold is. The answer to free up time is to delegate more – either to existing team members, new people you recruit, or externally to outside contractors. However, if delegation were that easy, everyone would be doing it now, right? So, what is the art of delegation? We say art, because delegation is not an exact science; different approaches are needed depending on who the ‘delegate’ is. Time and effort are required to effectively pass on tasks to others. Often, the time the delegator needs to put in initially is greater than if they did the work themselves – that’s why so many people don’t delegate. The view that ‘it’s quicker for you to do it yourself’ holds you trapped and unable to be more productive and effective yourself. It also stops others from developing better ways to do things than you already know, i.e. if you teach them your way, then they can master that AND add their own value – two minds being better than one. Here are some essential principles to apply to help you to delegate (as opposed to abdicate!): Delegation Assess the task, issue to the right person and support - helps build trust and respect Be specific and crystal clear for greater communication Request they repeat back instructions, so you know you were understood, enabling higher productivity Set a time frame and request clarification that the task has been achieved, ensuring jobs are completed on time and are profitable Both parties to review - opens the door for future work Abdication Issue tasks to anyone and forget about it - shows distrust and a lack of respect Giving unclear and little information results in poor communication Don’t ask if you were understood - results in low productivity Don’t set a time frame – it can mean jobs are delayed and over budget Different expectations can result in disgruntled clients No review results in no future work Delegation is a skill to be learned; applying these principles consistently will ensure long-term success. “No person will make a great business who wants to do it all himself or get all the credit” – Andrew Carnagie Action list: Which tasks am I currently doing that I could delegate to others? What can I do with the time I free up? Who are the best people for me to delegate these to? (Make sure they want to do these as part of their career development). What is the best way to document what is expected and how it should be done? What support and review process is needed to ensure success?

Work vehicles? Stay on top of tax with logbooks

11 August 2025
Logbooks are useful records of business expenses relating to work vehicles and this is important when calculating what tax deductions you can claim. Depending on your business entity type, different tax rules apply when you use motor vehicles to earn income, and you might use a logbook to track expenses in different ways. Sole traders and partnerships can claim income tax deductions for motor vehicle expenses if the vehicle is used to help earn income for the business. If you don’t use the vehicle exclusively for business, you can’t claim 100% of vehicle expenses. You need to work out the business use of the motor vehicle to calculate what deduction you can claim. You can do this either by using a logbook to track actual costs or using a logbook over a test period to establish the average business usage. Companies are a bit different. Where company vehicles are used partly to earn income and partly for private use, vehicle costs associated with private use are liable for FBT. Companies can use logbooks to keep track of work-related costs and show either that the vehicles are work-related vehicles which don’t attract FBT where used for work purposes only, or that FBT is accounted for correctly where there is some private use of other vehicles. The logbook becomes a record of work-related use and of private use subject to FBT. Where a company restricts private use of the vehicle, a logbook is used as evidence that employees have complied with the restriction. Whatever type of business structure you have, we can advise you on keeping good records and understanding what you can claim.

Changes to KiwiSaver: How to get your business ready

11 August 2025
Major changes to KiwiSaver were announced in Budget 2025. The KiwiSaver voluntary savings scheme is aimed at helping New Zealand workers save for retirement or buy a first house. But with the rising cost of living, action was needed to make KiwiSaver fit for purpose and more fiscally sustainable as a savings scheme. How will these changes affect your employees and your small business? Let’s take a look at the details of these KiwiSaver changes. Changes affecting your employees First off, let’s outline how the initial changes announced in Budget 2025 will affect your employees and other Kiwi workers: Since 1 July 2025: Younger workers will qualify for government contributions: People aged 16 and 17 will qualify for government contributions, so long as they meet other eligibility requirements. Prior to 1 July 2025, members must be 18 or older to qualify. Government contributions to halve: The government KiwiSaver contribution will halve, reducing the maximum government contribution from $521.43 to $260.72 each year. High earners to lose government contributions: People who earn more than $180,000 of taxable income in a year will no longer qualify for government contributions. No change to 2025 government contributions: There’ll be no change to government contributions for the year ending 30 June 2025. These will be paid in July and August at the current government contribution rate. Changes affecting your small business Next, let’s lay out the KiwiSaver changes that will directly affect your business: From 1 April 2026: Employer contributions will rise to 3.5%: From April 2026, the default KiwiSaver contribution rates for both employers and employees will rise to 3.5% – up from 3%. Employees can choose to remain contributing at 3%: Employees who are members of the KiwiSaver scheme will be able keep their contributions at the current rate. They can apply for a temporary rate reduction from 1 February 2026, if they want to continue contributing at 3% from 1 April 2026. Employers can match the rate reduction: As an employer, you’ll be able to match your employee’s temporary rate reduction. Once your employee moves to a higher contribution rate, you’ll need to increase your employer contributions to the default 3.5% rate. Inland Revenue will notify you of this change. Younger workers will qualify for KiwiSaver contributions: People aged 16 and 17 will qualify for employer contributions. If they contribute to KiwiSaver from their wages, you will need to start making employer contributions. From 1 April 2028, the default contribution rates for employers and employees will rise again to 4% (up from 3.5%). Getting ready for the KiwiSaver changes These amendments to KiwiSaver could have a significant impact for your small business. Increased employer contributions will increase your payroll costs and stretch your cashflow, as will making contributions for younger workers in the 16 to 17-year-old age bracket. You'll also need to update your payroll software and processes, to ensure you’re making the correct contributions for the right people, at the right rates. 
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