Saving Money on ACC Premiums
ACC has recently changed the way it invoices self-employed clients with regard to their full or part-time status, dependent on whether you work 30 hours or more a week.
Information on your full or part-time status no longer flows through to ACC’s database on the IRD IR3 form. If you held part-time status last year and this year your earnings crossed the threshold you will receive a letter from ACC automatically confirming your change to full-time status. In all other scenarios it is up to you to formally confirm a change of status with ACC.
It would pay to check your invoice this year and call us if there’s any confusion. You could get stung, for instance, if you have been paying levies on the basis of part-time status, have an accident, and then declare full-time status. In such a case ACC may query it and can backdate invoices levies up to four years – ouch!
The other point about being part-time is that then you will only pay ACC premiums on your actual earnings whereas if you are regarded as full-time, you will pay ACC premiums on the current level of minimum earnings as set by ACC, currently $26,520. In these recessionary times $26,520 is a lot to some!