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Book Review: Pay Zero Taxes

This is not a book about financial planning or about money, but it is guaranteed to put more money in your pocket each year than any other book you have ever read.

Thursday, November 17th 2005, 3:11PM

Pay Zero Taxes
By Peter Sibbald
Only $24.95

Reviewed by Vicky Powell on behalf of Good Returns.

If the average New Zealander were to add up what they pay in PAYE, withholding taxes, company taxes, GST, import duties, council rates, ACC, travel taxes, petrol taxes, alcohol and gaming taxes (phew!), and a myriad of other taxes, they would find that they are paying about 45% of their income in taxes. The shocking fact is that if you are a high-income earner, you are working from January 1 to August 24 each year for the government!

Author Peter Sibbald says: “Every dollar of tax saved is an extra dollar in your pocket. It’s the easiest and biggest pay rise you will ever get.”

Sibbald is a Christchurch-based chartered accountant and a member of the Institute of Chartered Accountants of New Zealand. A former “big four” chartered accountant, Sibbald has more than 20 years experience in public practice and company accounting.

The book contains hundreds of tips, techniques and strategies to increase your real income through income splitting strategies, tax shields, tax-smart investments and tax deductions.

Pay Zero Taxes is the third book Sibbald has written since Slash Your Taxes Now which was published in 2004. Slash Your Taxes Now was a best seller across the nation – perhaps an indication that most small businesses and self-employed people are keen to learn how to reduce their taxes, significantly and legally, through taking every legitimate tax deduction possible.

His next book, Slash Your Compliance Costs was a guide on managing and reducing small-business compliance costs in New Zealand. Red tape and compliance costs are the main concern of New Zealand’s small businesses and the aim of this book was to empower business owners with sure-fire strategies and the inside knowledge to legally reduce hefty operating costs in this area.

However, in my opinion, Pay Zero Taxes is better than both its predecessors, as it is tailored to most New Zealanders who are wage and salary earners, but does extend to business owners, rental property owners, investors and the retired. Sibbald shows how to take advantage of every legitimate income tax break the IRD allows.

Sibbald starts the book with a chapter on tax planning. He recommends that you always prepare a tax return, look at the result and if it’s a refund, then file the return. “There are millions of dollars in potential tax refunds sitting unclaimed in the IRD coffers as a result of PAYE earners no longer being required to file a tax return,” says Sibbald.

The chapter on tax shields and tax shelters is extremely interesting. Sibbald says that this chapter alone is worth more than a hundred times the cost of the book. I won’t divulge too much information here, but he outlines the advantages and disadvantages of different company structures as well as trusts and the benefits relating to each.

Sibbald covers tax-smart investments (and some tax-dumb ones as well) and explains how to be tax smart with your investment choices. He even lists what he believes to be the three best tax-smart investments you can ever make.

Another interesting chapter was the one titled “Your home – the key to saving $15,000 every five years”. The answer is in setting up a home-office, even if only for the running of a part-time business. This I feel, is where you also need Sibbald’s first book, Slash Your Taxes Now, which goes into more detail of what deductions are available.

Pay Zero Taxes does not involve breaking the law, bending the law or even pushing the boundaries. It works within clearly established laws and rules so that all actions can be defended if challenged.

Ultimately, if you are a small business owner I would recommend having all three titles in your library. For wage and salary earners, if you’re taking Sibbald’s advice and wanting seriously to reduce your tax obligations, you definitely need to read Pay Zero Taxes and Slash Your Taxes Now.


Pay Zero Taxes is available online through the Good Returns Bookstore at www.goodreturnsbooks.co.nz
or call us on 0800 345 675.

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AIA - Back My Build 6.19 - - -
AIA - Go Home Loans 8.74 7.24 6.79 6.65
ANZ 8.64 7.84 7.39 7.25
ANZ Blueprint to Build 7.39 - - -
ANZ Good Energy - - - 1.00
ANZ Special - 7.24 6.79 6.65
ASB Bank 8.64 7.24 6.79 6.65
ASB Better Homes Top Up - - - 1.00
Avanti Finance 9.15 - - -
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BNZ - Classic - 7.24 6.79 6.65
BNZ - Green Home Loan top-ups - - - 1.00
BNZ - Mortgage One 8.69 - - -
BNZ - Rapid Repay 8.69 - - -
BNZ - Std, FlyBuys 8.69 7.84 7.39 7.25
BNZ - TotalMoney 8.69 - - -
CFML Loans 9.45 - - -
China Construction Bank - 7.09 6.75 6.49
China Construction Bank Special - - - -
Co-operative Bank - First Home Special - 7.04 - -
Co-operative Bank - Owner Occ 8.40 7.24 6.79 6.65
Lender Flt 1yr 2yr 3yr
Co-operative Bank - Standard 8.40 7.74 7.29 7.15
Credit Union Auckland 7.70 - - -
First Credit Union Special - 7.45 7.35 -
First Credit Union Standard 8.50 7.99 7.85 -
Heartland Bank - Online 7.99 6.69 6.45 6.19
Heartland Bank - Reverse Mortgage - - - -
Heretaunga Building Society 8.90 7.60 7.40 -
HSBC Premier 8.59 - - -
HSBC Premier LVR > 80% - - - -
HSBC Special - - - -
ICBC 7.85 7.05 6.75 6.59
Lender Flt 1yr 2yr 3yr
Kainga Ora 8.64 7.79 7.39 7.25
Kainga Ora - First Home Buyer Special - - - -
Kiwibank 8.50 8.25 7.79 7.55
Kiwibank - Offset 8.50 - - -
Kiwibank Special - 7.25 6.79 6.65
Liberty 8.59 8.69 8.79 8.94
Nelson Building Society 9.00 7.75 7.35 -
Pepper Money Advantage 10.49 - - -
Pepper Money Easy 8.69 - - -
Pepper Money Essential 8.29 - - -
Resimac - LVR < 80% 8.84 ▼8.09 ▼7.59 ▼7.29
Lender Flt 1yr 2yr 3yr
Resimac - LVR < 90% 9.84 ▼9.09 ▼8.59 ▼8.29
Resimac - Specialist Clear (Alt Doc) - - 8.99 -
Resimac - Specialist Clear (Full Doc) - - 9.49 -
SBS Bank 8.74 7.84 7.45 7.25
SBS Bank Special - 7.24 6.85 6.65
SBS Construction lending for FHB - - - -
SBS FirstHome Combo 6.19 6.74 - -
SBS FirstHome Combo - - - -
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TSB Bank 9.44 8.04 7.55 7.45
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TSB Special 8.64 7.24 6.75 6.65
Unity 8.64 6.99 6.79 -
Unity First Home Buyer special - - 6.45 -
Wairarapa Building Society 8.60 6.95 6.85 -
Westpac 8.64 7.89 7.49 7.25
Westpac Choices Everyday 8.74 - - -
Westpac Offset 8.64 - - -
Westpac Special - 7.29 6.89 6.65
Median 8.64 7.29 7.32 6.65

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