Spending APD: tax deductible?

Old Jan 19, 20, 8:38 pm
  #1  
Original Poster
 
Join Date: Oct 2015
Location: Wellington
Programs: NZ E
Posts: 8
Spending APD: tax deductible?

Any accountants in the room? If I pay for business travel using APD, can I claim it as an expense for tax deduction purposes?

Before anyone flames me, the reason for the question is that APD are pretty much the same as spending real NZD, so just wondering if there is a precedent for this.

TIA.
honie99 is offline  
Old Jan 19, 20, 8:52 pm
  #2  
 
Join Date: Sep 2017
Programs: Air NZ Koru, Air NZ ELT *G, IHG Spire Ambassador, Emirates, Flying Blue, QANTAS Club
Posts: 353
Do you bring the APD earn in as income? When you earn them.
kiwicyclo is offline  
Old Jan 19, 20, 9:31 pm
  #3  
Original Poster
 
Join Date: Oct 2015
Location: Wellington
Programs: NZ E
Posts: 8
Originally Posted by kiwicyclo View Post
Do you bring the APD earn in as income? When you earn them.
Very good point. The APD earn is partly from business and partly from personal expenditure.

Self-employed sole trader scenario. So business expenses go on my credit card (as do personal expenses), both earn APD on the Visa (which I understand is not taxable as income?) then get spent either personal or business travel.

Last edited by honie99; Jan 19, 20 at 9:33 pm Reason: Clarify my answer..
honie99 is offline  
Old Jan 19, 20, 10:10 pm
  #4  
 
Join Date: Nov 2017
Location: New Zealand (when I'm home!)
Programs: Air NZ Elite
Posts: 819
APD earned and then spend has zero bearing on taxes. You cannot claim them as an expense as they are not counted as income. If you aren't being taxed for earning them you can't have your cake and eat it too by claiming that spending them is an expense.

What I would like to know is if BUYING APD with a credit card can be counted as an expense. My guess is yes but I don't know for sure.
kiwifrequentflyer is offline  
Old Jan 19, 20, 10:51 pm
  #5  
Original Poster
 
Join Date: Oct 2015
Location: Wellington
Programs: NZ E
Posts: 8
Originally Posted by kiwifrequentflyer View Post
APD earned and then spend has zero bearing on taxes. You cannot claim them as an expense as they are not counted as income. If you aren't being taxed for earning them you can't have your cake and eat it too by claiming that spending them is an expense.
Makes sense. In which case you're better off to collect as many APD as possible on business expenditure, spend real$ on business travel and claim the expense against it, and save the APD for personal travel.
trooper likes this.
honie99 is offline  
Old Jan 19, 20, 11:39 pm
  #6  
 
Join Date: Dec 2017
Location: Wellington
Programs: AirNZ Airpoints Elite
Posts: 120
Originally Posted by honie99 View Post
Makes sense. In which case you're better off to collect as many APD as possible on business expenditure, spend real$ on business travel and claim the expense against it, and save the APD for personal travel.
Ssshhhh, talk like that may result in our APD’s being forcibly redistributed in the name of equality, fairness or someone’s wellbeing.
honie99, poopbunny, Beano and 1 others like this.
freemark is offline  
Old Jan 20, 20, 12:14 am
  #7  
 
Join Date: Dec 2019
Posts: 452
definitely claim them and tell us how your audit goes
Beano likes this.
mctaste is offline  
Old Jan 20, 20, 12:27 am
  #8  
Original Poster
 
Join Date: Oct 2015
Location: Wellington
Programs: NZ E
Posts: 8
Originally Posted by mctaste View Post
definitely claim them and tell us how your audit goes
it was only a matter of time before a d1ck head comment was made

Last edited by honie99; Jan 20, 20 at 12:28 am Reason: FT censor machine didn't like my original word.
honie99 is offline  
Old Jan 20, 20, 12:36 am
  #9  
 
Join Date: Nov 2017
Location: New Zealand (when I'm home!)
Programs: Air NZ Elite
Posts: 819
Frequent flyer miles are definitely one way to get a little extra value from your business spend. I am happy they are separate from income, most of mine are earned through business expenditure!
honie99 likes this.
kiwifrequentflyer is offline  
Old Jan 20, 20, 1:13 am
  #10  
 
Join Date: Mar 2005
Location: PPQ/WLG/BKK
Programs: TG*G, Accor Gold
Posts: 7,718
Originally Posted by honie99 View Post
it was only a matter of time before a d1ck head comment was made
Relax. I read the comment as an obvious ‘tongue in cheek’ remark......
mctaste likes this.
Thai-Kiwi is offline  
Old Jan 20, 20, 1:17 am
  #11  
 
Join Date: Jan 2012
Location: Christchurch, NZ
Programs: NZ *E, Accor Platinum, Hertz President’s Circle
Posts: 611
As did I
mctaste likes this.
Markhm is offline  
Old Jan 20, 20, 1:26 am
  #12  
Original Poster
 
Join Date: Oct 2015
Location: Wellington
Programs: NZ E
Posts: 8
meh. last day of the holidays, back to work tomorrow. maybe I'm just being grouchy then..
trooper likes this.
honie99 is offline  
Old Jan 20, 20, 2:57 am
  #13  
 
Join Date: Mar 2014
Location: bne
Programs: Velocity Gold, AIRNZ Elite, Qantas Silver ,Hilton Diamond
Posts: 1,073
Can you claim APD tax deduction

Originally Posted by honie99 View Post
Any accountants in the room? If I pay for business travel using APD, can I claim it as an expense for tax deduction purposes?

Before anyone flames me, the reason for the question is that APD are pretty much the same as spending real NZD, so just wondering if there is a precedent for this.

TIA.
Yes
Everytime you earn airpoints on a business travel the journal entry is
Credit travel
Credit GST
Debit airpoints inventory

When you use
Debit travel
Debit GST
Credit airpoints inventory

If you use the airpoints for personal purposes then you need to pay GST
Or pay paye on the use


That's the theory but I assume most people would ignore airpoints
honie99 likes this.
Beano is offline  
Old Jan 20, 20, 3:41 am
  #14  
 
Join Date: Dec 2019
Posts: 452
Originally Posted by honie99 View Post
it was only a matter of time before a d1ck head comment was made
you get what you give
mctaste is offline  
Old Jan 20, 20, 2:22 pm
  #15  
Ambassador: Air New Zealand
 
Join Date: Dec 2006
Location: Wellington NZ
Programs: NZ Gold, EK Gold, Qatar Gold, Amex Plat, Accor Gold, Hilton Gold
Posts: 1,302
One Ruling I have found.

IRD Product Rulings 2004
Airpoints Dollars - accruing and redemption

Applicant: Air New Zealand

Ruling Number: BR Prd 04/13

Under this ruling, no gross income arises to members of the Air New Zealand Airpoints Programme when they receive Airpoints Dollars or Rewards, and there is no FBT liability.

Ruling applies: 3 November 2004 to 2 November 2007
IRD Ruling
kiwifrequentflyer and honie99 like this.

Last edited by WLG Base; Jan 20, 20 at 2:30 pm
WLG Base is offline  

Thread Tools
Search this Thread
Search Engine: