The beginning of a new financial year is bringing with it a raft of changes and with it new rules and regulations for kiwi employers to get to grips with. If you’re looking at your payroll and thinking someone has pulled a cheeky April fools prank it’s time for an update. The three main changes to affect employers are a drop in ACC Earner Levies, an update of the Student Loan scheme and an adjustment to Kiwisaver.
ACC LEVIES TAKE A DROP
- With April comes a reduction in the ACC earners levy rate. While it isn’t a huge drop, from the current 2.04 to 1.7 percent of a workers salary this will ultimately mean extra dollars in the employee pocket rather than the IRD coffer.
TINKERING WITH KIWISAVER
- The kiwisaver scheme also has a slight adjustment. From April onwards the full employer contribution is to be taxed. Before now the first 2% had been exempt, this will impact employers as they will now have to pay more tax on employee Kiwisaver accounts.
STUDENT LOAN CODES
- Now everyone who has a student loan will have to use a student loan tax code, regardless of how much they are earning. Previously employees would have only used the “SL” tax code when earning above the $19,084 repayment threshold per year. There are also new codes for student loan repayments: SLCIR for compulsory deductions and SLBOR for voluntary deductions.
Make sure that you’ve got your head around the changes and aren’t caught short early on in the new financial year!