While the changes which come into effect on April 1st this year are not major from a payroll system perspective they are important from a business perspective.
New Minimum Wages Rate:
Most of you will have seen the media coverage foreshadowing the change to the Minimum Wage.
The adult minimum wage will go up by 50 cents to $15.75 an hour from 1 April 2017. The starting-out and training hourly minimum wages rates will also be increased from $12.20 per hour to $12.60 per hour from 1 April 2017.
Student Loan Threshold:
The Student Loan threshold increases on April 1st from $367 to $368 (Don’t ask. Obviously someone spent a lot of time thinking about this one)
ACC Earner Levy Rate:
The ACC Earner Levy Rate for the 2017/2018 tax year will stay the same at $1.39 for every $100 of liable earnings. This applies to all pay periods ending on or after the April 1st.
ACC Earner Levy Maximum Liable Earnings:
The maximum liable earnings for the ACC Earner levy will increase to $124,053 for all pay periods ending on or after the April 1st.
What do you have to do about these Tax and ACC changes. Again – it depends on your payroll provider who should take care of this for you. Note: if you have employees whose pay is set up to paid by Automatic Payment i.e a fixed amount each pay period, be sure to update these before their first pay period after April 1st.
If you want to check out how this changes will impact your staff you can do this using the nifty little PAYE Calculator produced by Crystal Payroll. You can choose a date before and after April 1st to see the difference. Try it here
Changes to Schedular Payments:
Budget 2016 also introduced changes for contractors, and payers of contractors, as well as other business tax changes that will come into effect on 1 April 2017. You may be affected by the changes if:
- you pay schedular payments
- you receive schedular payments
- you’re a labour hire business and you pay contractors
- you’re a contractor working for a labour hire business, e.g. recruitment company, or
- you pay provisional tax.
Well, that’s it for this round of April 1st changes.
If you would like to talk about your payroll needs or concerns that your current payroll provider isn’t cutting it, you can reach us via www.payrollhq.co.nz