Wanganui Rivercity Press Article
Christine Savage is a Senior Accounting Technician within our business advisory team.
If you have a particular subject you would like Christine to cover in an article contact her on csavage@silks.co.nz or
ring her on 06 345 8539.
We are all familiar with how Kiwisaver works but have you kept up with the changes made to the scheme?
The Government has said the country can't afford the scheme under the original rules, so have made some adjustments. At the last Budget the government cut the amount of its contribution to your Kiwisaver scheme. The amount was halved from 1 July 2011 and is now a maximum of $521 pa. T he $1000 kick-start when you sign up is still available.
As from 1 April 2012, the employers' contribution to Kiwisaver will be subject to Employers Superannuation Contribution Tax (ESCT). This means an increase in the tax take and a deduction to the amount that a member receives.
The method of calculating ESCT has also changed. As from 1 April 2012, ESCT will be a progressive rate based on the employee's annual income plus gross employer contributions paid in the prior year if they have been employed for over a year; or if less than a year an estimate of the gross income plus employer contributions for the current year.
If you run a software programme to calculate your wages you will need to update for the above changes before the 1 April 2012. For those who only have a few employees and run a manual wage system, this is something you will need to consider when calculating the wages. The IRD have a very good PAYE / Kiwisaver calculator on its website.
Published 20 February 2012
