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Accounting is Just the Beginning

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Employer Changes From 1 April 2013

photo credit: http://www.sxc.hu/browse.phtml?f=view&id=253947

If you’re an employer watch out, there are important changes which took place on 1 April 2013.

KiwiSaver Contribution Rate Increase

The minimum contribution rate for employers and employees will increase from 2% to 3% of gross salary or wages from the first pay period starting on or after 1 April 2013. The changes will affect your payroll calculations and the details you enter on your Employer monthly schedule (EMS).

Primary and Secondary Schoolchildren

As part of the Government 2012 Budget, the tax credit for children was repealed from 1 April 2012. This tax credit covered the tax on the first $2,340 of income from employment for employees under 18. If you pay salary/wages or schedular payments to schoolchildren, you must now deduct tax and record their details on your EMS. If your employee or Inland Revenue request you to, you will also need to deduct KiwiSaver employee contributions for existing KiwiSaver members under 18 years of age. You don’t need to make employer contributions.

Employees under 18 are not subject to automatic enrolment.

ML And ML SL Tax Codes Can No Longer Be Used
PAYE should be deducted using the M or M SL rates from 1 April, unless the employee provides a new Tax code declaration (IR 330).

Tax Code Declaration (IR 330).

These have all changed, so throw all the old ones away and order some new ones from the IRD.

Student Loan Repayment Rate Change

The repayment rate for standard student loan deductions will increase from 10 cents to 12 cents.

What This Means for You.

Your old PAYE tables are of no use, so if you’re still in the Dark Ages get some new ones. If you’re using payroll software, this needs updating.
Perhaps it’s time you used an expert to process your payroll, it’s cheaper than you think!