What is a business industry description?
A business industry classification is a way of classifying a business by the main activity it is involved in. Each classification consists of a description (the 'business industry description') and an associated code (the 'BIC code'). ACC uses business industry descriptions and their related BIC codes to determine which of ACC's classification units will apply for levy invoicing.
What is a CU (classification unit) description?
An ACC CU represents a group of businesses from the same sector with a similar risk of workplace injury. Each ACC CU has an ACC levy rate, which is used to calculate ACC levies for workplace injury cover and residual claims. Each ACC CU consists of a description and an associated CU code.
What is ANZSIC (Australian and New Zealand Standard Industrial Classification)?
ANZSIC has been jointly developed by the Australian Bureau of Statistics (ABS) and Statistics New Zealand. This is the system of classification that ACC, Inland Revenue, and Statistics New Zealand have adopted to provide a common way of describing the specific service a business or person provides. Each ANZSIC description has its own unique ANZSIC code. The ANZSIC 1996 version has been updated and from 2008/2009 the ANZSIC 2006 codes are shown. For more information, see the industrial classifications page of the Statistics New Zealand website.
When do I need to know my business industry description or related BIC code?
There are several occasions when you will need to know your business industry description and code:
- Registering for GST?
- Completing an annual income tax return?
- Are you a shareholder-employee?
- Are you involved in two or more business activities?
How do I determine my business industry description and BIC code?
The easiest way to get your business industry description and its BIC code is to use the search function on this site.
Why is it important to choose the correct business industry description and BIC code?
Choosing the correct business industry description and its related BIC code means your accounts at Inland Revenue and ACC will be set up with the right information, and any invoices you are sent are calculated correctly.
How do various agencies use the information on this site?
The business industry and CU descriptions and codes found on this site are used in different ways by several different agencies. See the table below:
| Agency | How the information is used | For more information |
|---|---|---|
| Accident Compensation Corporation (ACC) |
| ACC For Business ACC safer industries |
| Inland Revenue |
| IRD |
| Statistics New Zealand |
| Statistics New Zealand |
What do I put in the search box?
Describe the main activity undertaken by you or your business.
'Activity' means the activity undertaken in the business, industry, profession, trade, or as an employer, self-employed person or private domestic worker.
Incidental functions relating to the activity such as administration, management, marketing and distribution, technical support, maintenance and product development are treated as part of that activity and not as separate activities.
In most cases, the activity will relate to services the business provides or goods the business produces.
For a self-employed person, the activity refers to the nature of the work done, rather than the context of the business in which the work takes place.
Examples
For a business that employs three plumbers and one office manager, you should search under 'Plumbing' as this is the service the organisation provides.
In a partnership where one partner is a plumber and the other partner does the administration, each partner would search under the activity that matches the work they do - the plumber would search under 'Plumbing', and the partner doing bookwork would search under 'Business administration'.
Registering for GST?
When you register for GST, it is important that you chose the correct BIC code.
The BIC code will need to be entered at question 8 of the GST registration IR360.
Completing an annual income tax return?
If Box 6 of your IR3, IR4 or IR7 is blank or you want to change the description on your IR return form, you will need to enter a business industry description up to and including the 2008 year, or a BIC code for the 2009 and subsequent years.
It is important that you enter the description or code that most accurately reflects the nature of your business or trade. If you changed your business activity since you last completed an annual income tax return, you should contact ACC on 0508 426 837 to register this change.
Are you a shareholder-employee?
A shareholder-employee should use the same business industry classification or BIC code as their employer.
Are you involved in two or more business activities?
Self-employed:
If you are involved in two or more business activities during the year and are unsure which description or code to use please contact ACC on 0508 426 837.
Employers:
There may be many staff in your business undertaking lots of different tasks. However, you are required to select a single description or code reflecting your main business activity.
Some businesses may qualify, for the purposes of ACC, to use multiple classification units. If you are involved in two or more business activities, the guidelines below will help you to see if you are eligible to use multiple classifications.
Multiple description guidelines
Please note that any request to use multiple ACC classification units must be made directly to ACC. If you require more information please contact ACC on 0800 222 776.
The guidelines below explain the multiple classification rules.
- You must have distinct and independent activities:
- Each activity must provide a service to an external customer.
- An internal service provider is not classified separately.
- Any one activity must be able to continue if all the others cease to exist.
- Producing raw materials for, and selling the production from, your own manufacturing unit are not separate activities.
- Your accounting records must demonstrate the separate management and operation of each activity:
- Regularly produced management accounts are more likely to satisfy this condition than annual accounts.
- Accounts created retrospectively do not demonstrate the separate management of the activity during the year.
- Accounts must mirror your organisational structure to demonstrate separate management.
- A good practical test is whether the accounting records would establish a value for the activity, if it were sold.
- All income and expense items should be attributed to the activity at source (reallocation on a percentage or share basis is usually unsatisfactory)
- Your accounting records must contain all relevant income and expenses, including overheads.
- There must be records showing the earnings of employees separately for each activity:
- Separate activities cannot exist if all staff are shared.
- Separate payroll systems are not required. Your wage records may be kept on a central system.
- For employees engaged in two or more activities, you can ignore any activity that provides less than 5% of an employee's earnings.
- ACC or Inland Revenue may ask you to produce your accounting or wage records.
- If a company is a consolidated or an amalgamated company filing a single PAYE schedule or IR4 return, multiple classifications may be used reflecting the activities of the group entities, provided the activity and record-keeping requirements are met.