Nearly half of Kiwi small business owners have considered giving up their business due to stress, according to new research by Xero on the emotional toll of business ownership.

Xero’s Emotional Tax Return (ETR) report, released February 12, has uncovered the significant impact running a small business can take on the wellbeing and productivity of small business owners across Aotearoa New Zealand.

Three quarters (75%) of Kiwi small business owners said the current financial year had been more stressful than past years, citing rising costs (48%) and unpredictable demand (30%).

The survey found 47% of respondents had considered giving up their business due to stress, with 67% citing financial management as a stressor.

Bridget Snelling, country manager – Aotearoa New Zealand at Xero, says the results reinforce the confronting realities of running a small 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,” says Snelling.

“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.”

End of financial year stress stings

The end of the financial year amplifies stress, with almost half (42%) of small business owners saying they found this period more stressful than the rest of the year.

More than a third of respondents (34%) needed to chase paperwork, while 31% worried about making mistakes. Over half (54%) had been surprised by a tax outcome, with the majority of these 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,” says Snelling.

“Proactivity is crucial to help get on top of this period and avoid any unexpected tax surprises.”

Stress steals productivity — and sleep

On average, stress costs business owners five hours of productive work every week, equating to around 30 working days lost per year, according to the research.

Many owners also felt the impact physically. More than half (55%) said they have had less sleep since starting their business, with 12% losing five or more hours a night.

Yet only 10% seek advice from an accountant or advisor when they’re stressed, leaving many exposed to errors and unexpected outcomes.

“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.

“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,” she adds.