Reflecting on my money in 2021

Happy holidays, everyone! I hope you had a wonderful, wholesome Christmas and are enjoying your holidays, especially after the year it’s been. With only 3 days till 2022, I thought: what better time to reflect on 2021?

So here’s what my 2021 was like, across my personal life, mental health, and financial wellbeing…

I quit my job without another one lined up

One of the best decisions I’ve ever made! If you find yourself constantly wondering if you should leave your job and look for something better, whether that’s a job with a better culture or starting your business to pursue a life of entrepreneurship, consider it a sign and follow your intuition. While I took some precautions, such as checking my emergency fund and reducing expenses, quitting my job before I had another lined up was still a terrifying risk for me.

I’m so glad that I trusted that things would work out. 6 months later, things are better than I could’ve ever imagined - not only financially, but in my sense of self-worth. I’ve found myself consistently feeling more confident, feeling supported in my personal growth, and having the energy to work towards my dreams. It certainly beats feeling burnt out almost all the time. (And I love that my new company has mental health leave!)

Everyone else I know who left the same workplace has since found a job where they have more supportive managers, a more positive work environment, a more competitive salary, and more satisfying, meaningful work. If you’re constantly experiencing doubt about where you are and pondering the the idea of finding something better, take the leap!

For more on my experience, check out my blog post here.

Our income changed three times

My husband and I had a change of income three times in 2021. First, I increased my income by $14,000 in June. Shortly after, my husband received a pay rise of $13,000 in July. Here’s what we did with our $27,000 pay rise.

In November, my income reduced by $10,140 when my boarder moved out after four years. I’d purchased my home in 2017, and I was lucky that right around this time, my husband’s best friend had been looking for a room to rent in the same area, and so I rented out the second bedroom a month later. Charging only $195 per week, less than the lowest rent in my area according to Tenancy Services, it made for a stable, consistent source of passive income these past few years.

After four years, it felt like the three of us were outgrowing our shared space. We explained that we had baby plans on the way, and he moved out mid-November.

So how much did our income change in 2021? $14,000 + $13,000 - $10,140 = an increase of $16,860!

We got to live together as a married couple for the first time

With the house to ourselves, my husband and I got to live together as a married couple for the first time - ever!

When my boarder moved in, my husband - my boyfriend at the time - was living with his parents. He moved in a year into our relationship, 6 months after I bought the house, when his parents moved from Auckland to Te Awamutu.

Living together as a married couple has been life-changing. With the second bedroom freeing up a lot of space, our home has given us more breathing space both physically and emotionally. It helped me take a more holistic view on reducing our income by $10,140 - that despite this, we are happier.

This year, we hosted our very first Christmas dinner for my family, with a delicious candlelit feast out on our deck. We bought the Hello Fresh Christmas Box, which was $215 for 4-6 people and included dishes like roast chicken, Christmas heritage ham, cherry, strawberry & peach trifle, honey-thyme carrots, salmon crostinis, and more.

The whole evening was perfection. At times like these, I feel incredibly grateful to have my own place to call home; a place to decorate, make warm and cosy, and invite loved ones over to.

Despite the judgment I’ve received a few times over the years, this year, I’ve worked through some of this discomfort and learned to let go. After all, there’s countless pros of having a small house. My small house means a small mortgage, as well as less to clean, less to tidy, less to maintain. At the end of the day, if you have everything you need, and know you’ve made the right choice for you, don’t let the judgment of others stop you from enjoying the life you’ve made for yourself.

As for the money we spent on the Hello Fresh Christmas Box? When my family offered to bring food or presents, I’d politely said no, explaining that there was plenty of food and that we weren’t doing presents this year (my husband and I mutually agreed, and we don’t see the point of meaningless clutter). I explained that the Hello Fresh Christmas Box cost $215, so if they wanted to, they could contribute towards this - anything would be appreciated. To my surprise, they generously covered the cost and then some.

We travelled somewhere new + rescheduled our travel plans

This year, my husband and I got to experience Rotorua together for the first time when we travelled there during Easter weekend. We mountain biked through the Whakarewarewa Forest, did the Redwoods Treewalk during day & night and Redwoods Altitude, and enjoyed an evening at Secret Spot Hot Tubs. It was magical and so, so worth it.

We had travel plans booked for Wellington in October and Queenstown in November, but of course, lockdown meant we had to reschedule. We’ve discovered wonderful new places to visit around Auckland for the past few months in lockdown, including some beautiful waterfalls and local walks. Using credit issued by Air New Zealand, we’ve since re-booked Queenstown for Valentines 2022, spending a week back where we got married. I can’t wait!

A dream come true + a new income stream

On 4th February 2021, my lifelong dream of publishing a book came true when a year of writing my book on and off paid off, and I became an author!

I started selling copies of my book by koha (donation). In the first month or two, I was breaking even and occasionally making a loss on some copies, especially since I’d underestimated how much shipping cost.

It took me about 3 months to make back all of my printing and postage costs, which was when I started making a modest profit from my sales. I set a price of $28 per copy after seeing that most donations were between $25 to $30, plus accounting for an NZ Post price increase.

Then came along @mindfulwithmoneynz on Instagram and mindfulwithmoneynz.com on Squarespace. I can’t express enough how happy I am to finally have a blog & online store in one, not to mention one that’s consistent with my style and feels like me (unlike my old Wordpress blog). If you’re thinking about creating an Instagram, blog, website, or online store to share your passion with the world, absolutely go for it!

Despite the highs and lows of 2021, I hope your year has been fulfilling, bringing you closer to the life of your dreams. I’m so grateful that with 91% of our eligible population fully vaccinated, the country has opened up again and we can go about our everyday lives - working, eating out, travelling, getting together with friends & family, and making things happen. Bring on 2022!

Sophia

6 money journalling prompts for 2022

Can you believe we're almost in 2022? With only 3 days to go, here are 6 helpful journalling prompts to help you reflect on the year it's been, celebrate your successes, and let go of anything that's no longer serving you, so you can level up your money in 2022!

What was my relationship with money like in 2021?

For example, did you ever find yourself feeling anxious, confused, or stressed when it came to money?

What would I like my relationship with money to be like in 2022?

For example, do you want to feel optimistic, happy, hopeful, grateful, stable, or secure?

What are 3 small steps I can take today to help make this a reality?

For example:

• opening a new savings account named 'Holiday', adding a picture of your next adventure that makes you feel excited & motivated, and setting a goal tracker on the account

• working out 20% of your fortnightly take-home pay and creating an automatic payment to your rainy day fund

• writing a list of your debts from the smallest balance to the largest balance to start your debt snowball plan

What were the best money decisions I made in 2021?

Let's delve deeper. Why? Were they aligned to your values? Did they allow you to express your authentic self? Did they give you more time to spend doing what you love? Did they help you pay off debt, grow your savings, upgrade your insurances, or anything else that gave you peace of mind? Did they help you tick off a bucket list goal? Did they help build your business, side hustle or passion project?

What money patterns or behaviours do I want to let go of in 2022?

It is December 2022. What does my dream life look like? What are the personal, work, and financial decisions I need to make to get there?

Wishing you a very happy holiday season,

Sophia

How to turn 14 days of annual leave into 47 days off in 2022

2022 is nearly here! If you work a standard work week of Monday to Friday, and would like to know how to turn 14 days of annual leave into 47 days off in 2022, I’ve got you sorted.

Here are all the dates you can apply for annual leave if you want to make the most of your time off:

• 5, 6, 7 January (3 days AL, 9 days off)

• 4 February (1 day AL, 4 days off)

• 19, 20, 21, 22 April (4 days al, 11 days off)

• 3 June (1 day AL, 4 days off)

• 27 June (1 day AL, 4 days off)

• 21 October (1 day AL, 4 days off)

• 28, 29, 30 December (3 days AL, 11 days off)

Be sure to get in as early as possible to increase the chances of your annual leave being approved!

And of course, if you don’t have enough plans to take all of your annual leave, check out my post on how to cash up your annual leave. That’s extra money for your savings or paying off debt!

Wishing you happy holidays,

Sophia

What we did with a $27,000 pay rise

From June to July this year, my husband and I were both very fortunate to receive a pay rise: an increase of $14,000 for my income, and an increase of $13,000 for his. Our last combined pay rise had been $6000 in 2019 (a story I share in the first edition of my book), so we were stoked to have more than quadrupled this number with a combined pay rise of $27,000!

So what did we do with it? Here are the four things we did with our extra income.

Sponsored a child

I’ve always wanted to sponsor a child. Prior to quitting my banking job, I managed to sponsor a child briefly before giving up my main source of income at the time for the sake of my mental health. With my $14,000 pay rise, I was delighted to be in the position to sponsor a child again! I signed back up to World Vision’s child sponsorship program and am now the sponsor of a 9 year old girl in India, helping to provide clean water, nutrition, education, healthcare and hope to her and her community for $50 per month.

Started studying

I graduated with my Bachelor’s degree almost a decade ago, and had been wanting to study again to learn something new, upskill, and gain another qualification that might help me further my career. I signed up to study a national certificate through Open Polytechnic, an institute that offers online and distance learning. While I have always needed to pay for my studies with a student loan, this time I simplified the process by paying cash for my first course, which was $500. The next course is $600 and the course after that $800, which I will also pay cash for - skipping over all the paperwork otherwise required in the process. It is refreshing being able to skip all the admin and not have to rely on Studylink to help pay for my studies! Bonus: completing my certificate online means that I’ve been able to study during evenings and weekends, so that it doesn’t disrupt my work at all.

Increased our savings

Although we managed to save 40% of our income while we were saving for our wedding and honeymoon, since getting married, we’d returned to our default saving strategy of 20% per the 50/30/20 rule. After we got our pay rise, we created a new savings account called ‘10%’.

Now, every fortnight when we get paid, we send 20% to our savings as usual - then send an extra 10% to this account. We do our best not to touch it, using it only if an important, unexpected or urgent expense comes up, and at the end of the fortnight, we send whatever is left to our savings.

This has worked incredibly well, and means that we are now saving 25% to 30% on average while always saving at least the minimum, fixed amount of 20%!

We’ve also increased our savings slightly with another new account…

Started a baby fund

Yep! We recently made the big decision to start a family in 2022/23, and have started a baby fund!

We are starting small, with $100 per fortnight going to our new savings account (named ‘Baby’, featuring a cheerful baby smiling adorably). Over the next year we’ll create a new budget, accounting for things like new baby expenses, specialist appointments, maternity clothing, prenatal supplements, and living on a reduced income. While we definitely have a lot to learn, we’re feeling very hopeful and excited for what’s to come.

If you’ve also received a pay rise recently, I hope this has given you some ideas on how to spend it meaningfully. Of course, if you haven’t quite figured that out, you can always do what my husband did with his $3000 pay rise in 2019: hide the pay rise from yourself! Simply calculate the actual dollar amount difference between your previous net (after tax) income and your current net income. Then, set up an automatic payment to send that exact dollar amount from your chequing account to your savings account every pay day. You’ll avoid the slippery slope of lifestyle inflation, while boosting your savings rate!

I hope this has been helpful. If you have any thoughts, please feel free to comment below, or contact me on Instagram at @mindfulwithmoneynz.

Sophia

What is provisional tax?

Hi friends,

Today I’d like to share with you what provisional tax is, and explain how it works (in New Zealand).

You've probably heard of provisional tax if you earn these types of income:

• self-employed income

• rental income

• income earned as a contractor

• income from a partnership

• overseas income

That's because provisional tax helps you to manage your income tax.

Provisional tax is not extra income tax you have to pay. It is a method of paying it, by breaking it down into simpler, smaller payments.

If you have to pay more than $5000 of income tax at the end of the financial year, IRD takes this (your residual income tax), adds 5% to it, then splits it into 3 instalments throughout the next financial year. This is the standard option.

Say you work as a full-time employee, and run a small business on the side. After filing your IR3 individual income tax return, you have residual income tax (think 'residue'; income tax left to pay) of $6000.

IRD says, "Oh no! That looks like a big tax bill. We don't want you to have to worry about such a big tax bill next year, so to make it easier, we will

• assume you will make 5% more next year

• break it down into 3 instalments for you."

• You'll now pay $6300 ($6000 + 5%) via 3 instalments of $2100 in August, January, and May.

You can also use the estimation option, if your income will either decrease, or increase by more than $60,000 over the next year. If you want to use the estimation option, simply let IRD know what your estimated residual income tax will be for the next financial year.

Say you stop your side business and your only income comes from your salary. You can also tell IRD and ask to re-estimate your provisional tax to $0. It’s that easy!

Find out more here, and discover more personal finance tips & tax know-how in my book, Mindful with Money.

I hope this has helped!

Sophia

5 ways to learn about money - for free

Financial literacy is important. And who doesn’t love free money resources? Today I’d like to share with you where I go to learn about money and all things personal finance - without paying a cent.

Eventbrite

You’ll find plenty of free money events on Eventbrite. Simply sign up for free, and in your ‘Interests’, go to the ‘Business’ section and select ‘ Finance’.

You’ll be recommended local workshops and seminars about property, savings, investments, and much more - with a mix of paid and free events!

Sorted

Sorted is made by the New Zealand and is dedicated to helping New Zealanders sort out their money. You can create your own dashboard to track your money goals, plus make use of the handy calculators - including mortgage, debt, Kiwisaver, investing, and more.

Podcasts

A fun and easy way to learn about money for free is through podcasts. You can learn about money and improve your financial literary while driving, working out, grocery shopping - practically anything! Some personal finance podcasts I would recommend are She’s On The Money, My Millennial Money, and the New Zealand podcast, It’s No Secret.

Library

It’s free to sign up to your local library, plus free to request them to buy the books you want to read. Some of my favourite personal finance books are The Richest Man in Babylon, Smashed Avocado, Money Diaries, You are a Badass at Making Money, and of course, Mindful with Money.

Social media

Follow banks and finance companies on social media, so you’ll know when they host workshops, webinars, and more. Westpac hosts free Managing Your Money workshops on topics like budgeting, saving, buying your first home, insurance, and more. I also love YouTube personal finance channels, like The Financial Diet, Aja Dang, and Sorelle Amore Finance.

Good luck!

Sophia

How you could get 25% or $200,000 towards your first home: First Home Partner explained

Hurrah! Two weeks ago, the New Zealand government announced the launch of First Home Partner, a new shared ownership scheme to help aspiring first home buyers whose deposit and home loan aren’t enough to purchase their first home.

First, let’s discuss: what is shared ownership?

Shared ownership is when you initially share ownership of a home with a third party, who purchases the home with you. In this case (through First Home Partner), it will be Kāinga Ora. You will be the majority homeowner and occupier, and Kāinga Ora will own a share in the home - one that you will buy out over time.

How much time are we talking about?

The rules are that you will need to do your best to purchase Kāinga Ora's share of the home within the first 15 years of ownership, and must have purchased the share in full by 25 years. You'll get a Kāinga Ora Relationship Manager who will meet with you yearly to review your financial circumstances and help you towards your home ownership goal.

How much you could get will depend on several factors, such as how much of a deposit you have and how much a participating First Home Partner lender is willing to lend you. For example, if you have saved 15% of the purchase price of a home and a participating bank is willing to lend you 60%, Kāinga Ora will contribute 25% to purchase the home with you in return for a 25% share of ownership in the home. You need to contribute at least 5%. Kāinga Ora will make a maximum contribution of $200,000 or 25% of the purchase price - whichever is lower.

To be eligible for First Home Partner, you must be:

• over 18

• a New Zealand citizen or permanent resident

• earn no more than $130,000 in household income

• have a good credit rating

• not previously received shared ownership support from Kāinga Ora

• buying the home to live in for at least 3 years

There are 5 steps to buying your first home through First Home Partner:

• Check if you are eligible

• Submit your application online

• Get home loan pre-approval

• Find and buy a home

• Become a full home owner

For the full eligibility criteria and more information, check out Kāinga Ora’s website, call them on 0508 935 266, or email firsthome.enquiries@kaingaora.govt.nz.

You’ll also find helpful downloads on the website, including the First Home Partner Brochure, an example of a Shared Ownership Agreement, and Kāinga Ora’s Guide to the Shared Ownership Agreement.

Good luck!

Sophia

Cashing up your annual leave

Did you know that you can get up to a week of your annual leave paid out in cash?

That’s right - of your four weeks’ minimum entitlement to annual leave every year, you can request for up to one week of this to be paid out to you in cash!

Here’s what you need to know:

• You need to have worked for your employer for at least 12 months

• You need to request your annual leave cash-up in writing

• You can request for up to one week of annual leave to be cashed up all at once, or make multiple requests throughout the entitlement year

• Your employer can say no, without providing a reason.

Annual leave holidays are paid at the rate of the greater of ordinary weekly pay and average weekly earnings. That means that one week of your annual leave could be approximately the following amounts, assuming you have a 3% Kiwisaver contribution rate and student loan repayments:

$645.24 on a $45,000 salary

$748.06 on a $55,000 salary

$851.15 on a $65,000 salary

$951.36 on a $75,000 salary

$1,048.70 on a $85,000 salary

$1,146.02 on a $95,000 salary

So if you haven’t got many plans this year - perhaps COVID has cancelled your summer getaway across the ditch - why not consider cashing up some of your annual leave? Whether you are saving for something special or paying off debt, that extra cash could make a big difference and help you reach your money goals faster.

Check out more information on cashing up annual leave from Employment New Zealand here.

Take care and stay safe!

Sophia

Lockdown diary #1: staying sane with books, TV & ASMR

Happy Sunday! It’s officially our second weekend in lockdown in New Zealand. Compared to our first lockdown on 26th March 2020, this lockdown, I’ve somehow found myself feeling more restless. Perhaps it was that the first lockdown gave many of us the chance to slow down, spend time with loved ones, devote ourselves to our personal projects, and look within - something many of us didn’t realise we needed. When I look back, I remember fondly how heartwarming it was to see people collectively making dalgona coffee, baking banana bread, working from home for the first time, and exploring a whole new way of living.

This lockdown, my husband and I are both working from home full-time. We live with my husband’s best friend who isn’t currently working, and is also fully vaccinated, so he has helped get groceries for the three of us. At night, we cook and share warm, hearty meals and enjoy a good TV show. Life is quiet, peaceful, ordinary; yet I still find myself caught up in moments of stress, anxiety, and negative emotions - some of which are lingering emotions from past trauma earlier in the year, and some I can only attribute to our current climate of uncertainty. It’s sometimes hard not to spiral, catastrophise, and wonder, ‘What if…?’

If you could also use a distraction, today I’d like to share with you six things keeping me sane this lockdown.

NEON

This lockdown, I thought I’d be cheeky and sign up to a free trial of NEON just to watch The White Lotus. I’d heard of the show from reviews of Nine Perfect Strangers, which my husband and I are enjoying on Amazon Prime (we got it for free when we upgraded our 2degrees internet plan). After binge-watching The White Lotus, I signed up for a subscription because I was so blown away by the amazing variety of movies and TV shows - most of which I like more than the ones on Netflix! There’s Broken Hearts Gallery, a quirky, whimsical romantic comedy. There’s Bombshell, the star-studded movie about the Fox News sexual harassment scandal. There’s bloody Game of Thrones! On my list are The Discovery of Witches, The Handmaid’s Tale, and Five Bedrooms, with more to come, I’m sure.

If you’re curious, you can grab a 14 day trial at neontv.co.nz. I got the annual subscription to save $31 per year ($15.99 per month vs. $159.99 for the year).

My reading stack

In our first weekend in lockdown, I finished Before You Knew My Name, a dark, soul-stirring thriller by New Zealand author Jacqueline Bublitz. Over these two weeks, when I haven’t been reading comforting books that help me stay calm and balanced, fiction has been my go-to choice for escapism. I’ve just started The Covered Wife by Wellington-born author Lisa Emanuel, another thriller that I’m really enjoying.

Next on my reading list is The Girl and the Goddess, Nikita Gill’s magical story in verse inspired by Hindu mythology - a story sure to inspire awe and wonder.

ASMR / ambience videos

Recently, I have become weirdly addicted to ASMR / ambience videos on YouTube. It started with video recommendations for RainRider Ambience and Alley of Ambience, which I immediately fell in love with. These 3D soundscapes are so soothing, not to mention beautiful to look at! They also provide a very welcome escape from the reality of being home 24/7 with nowhere to go. I love having a video playing on the TV in the background, so that even while I’m working, I can imagine I’m relaxing in a cosy spring garden or having a picnic in front of the fire by a waterfall - all with the sounds of birdsong, flowing water, and crackling flames.

If you’d like something more ethereal, you can also transport yourself to an enchanted forest. Reminiscing your travels? There’s gorgeous cultural locations, like a Japanese onsen.

Trying new recipes + supporting local businesses

In times like these, I feel extremely blessed that we still have access to supermarkets and meal kit deliveries. My husband and I have been using HelloFresh for years, but this lockdown we’ve decided to expand our repertoire and try out new recipes we wouldn’t normally try. Trying new things helps infuse fun and novelty into your life, no matter how small. Last night, we made a delicious Chocolate Toffee Pudding with Poached Pears. Coming this week are Cherry Cream Pancake Stack and Spiced Carrot & Nut Cake with Orange Buttercream Icing. How good do they look?! If you’re keen to try HelloFresh for the first time, you can score $100 off here.

Another company I’ve supported this lockdown is EcoRoll, who make cashmere-soft, environmentally friendly bamboo toilet paper. They’re wrapped in colourful designs that will definitely brighten up your bathroom! To me, this was a great alternative to going to the supermarket for toilet paper that may or may not have all been bought by panic shoppers.

Keeping busy with passion projects

Every lockdown, I try to stay busy by immersing myself in things I am deeply passionate about. It makes time go by quicker! This time, I’m proud to have created this very blog and online store, mindfulwithmoneynz.com. I’m going to sound like an ad, but I was truly surprised by how easy it was to set this up on Squarespace. It took three days from start to finish, including choosing a design template, personalising the colours, uploading my book as a product, setting up e-commerce with Stripe, transferring blog posts, creating pages & categories, and more.

The book itself has been one of my passion projects over the last few months - I am currently writing the second edition, soon to be released!

When I’m not blogging or writing my book, I do my online study - which is less of a passion project and more personal development. When I get easily distracted, listening to binaural beats or planting a tree helps.

Gratitude

Cheesy I know, but gratitude is a powerful way to pull ourselves out of a dark place and overcome something us humans all have: negativity bias. Gratitude turns what we have into enough when we actively focus on the small, positive things in life. What is going right, instead of what is going wrong. Plans that are going as we’d hoped, instead of falling apart. Things that remain steady and consistent in our life, despite spontaneous erratic changes in our external world (like sudden lockdowns).

I have my struggles with overcoming negativity bias, which is why I write in a gratitude journal every day. It’s a habit that’s low effort, high reward: making myself list three good things that happened in my day every day is a small price to pay to literally transform my mindset into being more optimistic, open-minded, and adaptable to change. A bonus is that, on bad days, it is uplifting to flip through and remind yourself of all the good things that have happened that you would’ve otherwise forgotten about!

Here are my three things that I’m grateful for, not just today but for the whole of lockdown:

• I’m grateful that during a global pandemic, I am safe at home, with everything I could possibly need: a warm, dry home, heating, fresh food, my laptop, access to entertainment and education, books, and the time to read, write, create, and dream.

• I’m grateful that I work in an essential service, and don’t have to worry about income. I’m grateful that many who may need it can get financial support and mental health support too.

• I’m grateful to be in a country that has absolutely excelled at their COVID response - we’ve made international headlines for how successful we’ve been at effectively having eliminated COVID previously, which gives me hope that it will happen again. I know we have received criticism for locking down the country over 1 case, but it was clearly a wise decision given that number has now increased to 429. That makes me grateful to be in a country where we’re constantly encouraged to wear masks, use contact tracing, socially distance, and be kind.
  
  I watched a YouTube video of someone who has experienced lockdown both in California and in New Zealand, and describes how much better it has been in New Zealand due to our ‘team of 5 million’ mentality and clear, communicative daily updates from the government. How blessed we are to have lived life perfectly normal for the past six months, when we could've had it worse.

I hope you’ve found a few ideas and inspiration to stay sane, happy and healthy this lockdown. To those in New Zealand living south of Auckland, I envy you for being able to move to level 3 from Tuesday! To Auckland and Northland, kia kaha 💗

Love,

Sophia

How to get money back from your charity donations

Did you know that New Zealand is one of the most generous countries in the world? The Charities Aid Foundation’s (CAF) World Giving Index 2021 found that New Zealand scored 7th for their generosity in 2021, based on the number of people who have helped a stranger, volunteered, or donated to charity. If you are one of the many New Zealanders who give to charity, today I’ll be showing you how you can claim back part of your charity donations.

To claim back part of your donations, you need to have donated $5 or more to an approved charity or organisation as an individual (not as a trust, partnership, or company) within the last 4 years. You can claim back the lesser of:

• 33.33% of your total donations, or

• 33.33% of your taxable income.

So how do you claim?

1. Ask the approved charity or organisation for a donation receipt.

2. Log into myIR and under 'All accounts (tax types) that you can access', click on 'Donation tax credit'.

3. If you haven't got this account, go to 'I want to...' > 'Register for new tax accounts' > Select your IRD number > 'Donation tax credit'

4. Once you're in your 'Donation tax credit' account, click on 'Add new receipt'

5. Attach your receipt under 'Add receipt attachment'

6. Confirm and submit your donation receipt(s) and bank account details.

Voila! IRD will either refund you the amount directly to your bank account, or, if selected, use it to offset any debt you might have for another tax type (e.g. income tax).

Personally, I’ve donated to two charities on an ongoing basis: World Vision and the Mental Health Foundation of New Zealand. I still donate to World Vision, and getting my donation receipt from them is always extremely easy. Payroll giving to the Mental Health Foundation of New Zealand meant that I didn’t even need to make a claim at the end of the financial year!

If you are thinking of giving to charity, I’d recommend finding a charity that truly resonates with your personal values - whether you are passionate about advocating for human rights, children’s rights, saving the planet, or something else.

You can find out more about making a donation tax credit claim here. There’s helpful information to let you know if you've donated to an approved donee organisation, information on what needs to be on your donation receipt, and more.

Love,

Sophia