PAYE and Kiwisaver

PAYE (Pay As You Earn) is the basic amount of income tax you take out of your employees’ wages whenever you pay them. PAYE includes an ACC earners’ levy. (Source: IR335 Employer’s Guide).

Now day employers must remember these basic PAYE steps:

  • Understand minimum pay entitlements for all employees
  • Ensure the correct calculation of wages
  • Keep accurate records
  • Pay the IRD on or before the due date

ACC earners’ levy:

Almost all earnings are liable for ACC earners’ levy, which include:

  • Wages and salaries
  • Overtime pay
  • Back pay and holiday pay
  • Long-service leave pay
  • Bonuses or gratuities
  • Taxable allowances
  • Shareholder-employee salaries
  • Salaries to partners in a partnership
  • Salaries to working owners of a look-through company

IRD collects the ACC earners’ levy on behalf of the ACC. For employees, this levy has been built into the PAYE tables and is deducted along with the tax.

Our service for payroll is a great way to safeguard confidentiality of wage information and ensures employment law is being adhered to with regard to leave entitlement and KiwiSaver.

If you need help in understanding this or any other tax topic, and how it relates to your business talk to us today, and let us assist you, call +64 9 522 2288 or email