Payroll Team Update
Minimum Wage Increase
On the 1st April 2017 the minimum wage will increase by 50c to $15.75 per hour. This rate applies to all employees 16 years and over. The starting-out and training hourly minimum wage rates will increase to $12.60 per hour, remaining at 80% of the adult minimum wage.
New IRD IR330 – Tax Code Declaration form
The IRD will be releasing its new IR330-Tax Code Declaration form on its website mid-March. Please make sure that you update your files to the new document.
ACC Earner Levy April 2017 – changes not yet passed by the Government
The Government has yet to pass the changes to the ACC Earner Levy from 1st April 2017. The current recommendation is to retain the ACC Earner Premium at 1.39% per $100 liable earnings. If this is passed by Cabinet there will be no changes to PAYE at 1st April 2017. The recommendation for the Maximum Liable Earnings is to increase from the current amount of $122,063 to $124,052. Our recommendation will be if you haven't heard anything in the news by 1st April or from your payroll software provider, the rate will remain the same at 1.39% and payroll software providers will upgraded their software to reflect the new maximum rate.
Schedule Payment Deduction Changes
There are changes proposed to the schedular payment rules in the Taxation (Business Tax, Exchange of Information, and Remedial Matters) Bill. These changes are not yet law but are due to take effect from 1st April 2017 if the bill is enacted in its current form;
•Contractors (including companies) hired by labour-hire firms under a labour hire arrangement will be added as a new schedular payment type
•Another new schedular payment type for persons wanting to voluntarily have tax deducted from their contractor income will be added. Voluntary schedular payments have a standard rate of 20 cents per dollar of the payment
•Most contractors will now have the ability to elect their own withholding rate, subject to a minimum of 10 cents per dollar of the payment. If the contractor provides their name and IRD number but does not choose a rate, the standard rate for the type of payment is to be used
•The no-notification rate as applicable for WT has been standardised at 45 cents per dollar of the payment
•The Commissioner will also be able to notify the payer of a specific tax rate to be deducted from payments made to a contractor
•A new tax rate notification form is being designed to cover all schedular payments. The existing IR330 will also be amended to remove schedular payments.
Sick Leave and its relations to ACC Entitlements
If an employee has an accident or injury covered by the Accident Compensation Corporation scheme the following apply:
•If an employee has a work related or non work related accident and gets weekly compensation, the employer can't make the employee take time off as sick leave or as annual holidays.
•If an employee is getting weekly compensation from ACC, the employer doesn't have to pay the employee.
•If the period of leave on ACC is more than five days, the employer and employee can agree that the employer will top up the ACC payment from 80 to 100% by using the one day of the employee's sick leave for every five days' leave taken.
Non work-related accident
When the employee is taking leave for the first week of a non-work accident, they can use sick leave if they have any.
Work-related accident
•If an employee has a work-related accident, the employer has to pay "first week compensation" equivalent to 80% of the employees' earnings and can't make the employee take the time as sick leave or as annual holidays.
•If an employee is getting "first week compensation" for a work-related accident, an employer and employee can agree that the employer will top up the first week from 80 to 100% by using one day of the employee's sick leave for every five days' leave.
REFERENCES:
https://employment.govt.nz/hours-and-wages/pay/minimum-wage/minimum-wage-rates/
http://www.ird.govt.nz/campaigns/2017/changes-schedular-payments.html
https://employment.govt.nz/leave-and-holidays/sick-leave/sick-leave-and-acc-payments/
Payroll team at Accounted4
Anne Bland Extn. 831
Carolyn Lawrence Extn. 837
Maree Craig Extn. 825
Kathryn Leong Extn. 859
On the 1st April 2017 the minimum wage will increase by 50c to $15.75 per hour. This rate applies to all employees 16 years and over. The starting-out and training hourly minimum wage rates will increase to $12.60 per hour, remaining at 80% of the adult minimum wage.
New IRD IR330 – Tax Code Declaration form
The IRD will be releasing its new IR330-Tax Code Declaration form on its website mid-March. Please make sure that you update your files to the new document.
ACC Earner Levy April 2017 – changes not yet passed by the Government
The Government has yet to pass the changes to the ACC Earner Levy from 1st April 2017. The current recommendation is to retain the ACC Earner Premium at 1.39% per $100 liable earnings. If this is passed by Cabinet there will be no changes to PAYE at 1st April 2017. The recommendation for the Maximum Liable Earnings is to increase from the current amount of $122,063 to $124,052. Our recommendation will be if you haven't heard anything in the news by 1st April or from your payroll software provider, the rate will remain the same at 1.39% and payroll software providers will upgraded their software to reflect the new maximum rate.
Schedule Payment Deduction Changes
There are changes proposed to the schedular payment rules in the Taxation (Business Tax, Exchange of Information, and Remedial Matters) Bill. These changes are not yet law but are due to take effect from 1st April 2017 if the bill is enacted in its current form;
•Contractors (including companies) hired by labour-hire firms under a labour hire arrangement will be added as a new schedular payment type
•Another new schedular payment type for persons wanting to voluntarily have tax deducted from their contractor income will be added. Voluntary schedular payments have a standard rate of 20 cents per dollar of the payment
•Most contractors will now have the ability to elect their own withholding rate, subject to a minimum of 10 cents per dollar of the payment. If the contractor provides their name and IRD number but does not choose a rate, the standard rate for the type of payment is to be used
•The no-notification rate as applicable for WT has been standardised at 45 cents per dollar of the payment
•The Commissioner will also be able to notify the payer of a specific tax rate to be deducted from payments made to a contractor
•A new tax rate notification form is being designed to cover all schedular payments. The existing IR330 will also be amended to remove schedular payments.
Sick Leave and its relations to ACC Entitlements
If an employee has an accident or injury covered by the Accident Compensation Corporation scheme the following apply:
•If an employee has a work related or non work related accident and gets weekly compensation, the employer can't make the employee take time off as sick leave or as annual holidays.
•If an employee is getting weekly compensation from ACC, the employer doesn't have to pay the employee.
•If the period of leave on ACC is more than five days, the employer and employee can agree that the employer will top up the ACC payment from 80 to 100% by using the one day of the employee's sick leave for every five days' leave taken.
Non work-related accident
When the employee is taking leave for the first week of a non-work accident, they can use sick leave if they have any.
Work-related accident
•If an employee has a work-related accident, the employer has to pay "first week compensation" equivalent to 80% of the employees' earnings and can't make the employee take the time as sick leave or as annual holidays.
•If an employee is getting "first week compensation" for a work-related accident, an employer and employee can agree that the employer will top up the first week from 80 to 100% by using one day of the employee's sick leave for every five days' leave.
REFERENCES:
https://employment.govt.nz/hours-and-wages/pay/minimum-wage/minimum-wage-rates/
http://www.ird.govt.nz/campaigns/2017/changes-schedular-payments.html
https://employment.govt.nz/leave-and-holidays/sick-leave/sick-leave-and-acc-payments/
Payroll team at Accounted4
Anne Bland Extn. 831
Carolyn Lawrence Extn. 837
Maree Craig Extn. 825
Kathryn Leong Extn. 859
