Nearly half of New Zealand’s small business owners have considered giving up their venture because of stress, with the end of the financial year compounding what Xero is calling an “emotional tax” on entrepreneurs across the country.
New research released today by Xero, its Emotional Tax Return (ETR) study, shows 47 percent of Kiwi small business owners have thought about walking away due to stress, while three quarters (75 percent) say the current financial year has been more stressful than previous years. Rising costs (48 percent) and unpredictable demand (30 percent) were cited as the biggest contributors.
Bridget Snelling, Country Manager – New Zealand at Xero, says the findings highlight the personal toll of running a business.
“Running a small business is hard work and business owners often have to make significant sacrifices – missing a child’s swimming sports or working all hours and not getting enough sleep. This is what we call an emotional tax, the hidden personal costs small businesses owners have to pay every year,” Snelling says.
She added that stress rarely stays contained within work hours.
“When everything rests on your shoulders, stress doesn’t stay at work, it compromises your time, focus and confidence. The end of the financial year amplifies this pressure, and for too many small business owners, this time is a source of dread rather than clarity.”
The research shows the end of the financial year is a major stress trigger, with 42 percent of small business owners saying this period is more stressful than the rest of the year.
More than a third (34 percent) said they had to chase paperwork, 31 percent worried about making mistakes, and 54 percent were surprised by a tax outcome — with most of those surprises being negative.
“We know the end of the financial year can sometimes sneak up on business owners who are so invested in the day-to-day doing of the work,” Snelling says.
“Proactivity is crucial to help get on top of this period and avoid any unexpected tax surprises.”
Stress is also eroding productivity. On average, business owners lose five hours of productive work each week, the equivalent of around 30 working days per year.
The physical impact is just as stark, with 55 percent saying they have had less sleep since starting their business, and 12 percent losing five or more hours a night.
Despite this, only 10 percent seek advice from an accountant or advisor when they are feeling stressed.
“Stress isn’t just a feeling, it slows decision-making, reduces creativity, and leads to avoidable mistakes,” Snelling says. “It impacts the skills owners rely on to succeed.”
She says professional support can make a material difference.
“Small business owners carry so much on their own, and having someone who understands their tax obligations and financial landscape can make a huge difference.
“Advisors help map out what’s ahead and reduce the chance of unexpected bills. Good advice doesn’t just fix problems — it prevents them.”
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