KiwiSaver (New Zealand only)

Kwik-Pay provides two pay items for the processing of KiwiSaver employee and employer contributions. When the 'add KiwiSaver deductions' checkbox in the payroll set up, tax details form is ticked, or if the 'Opted-in' checkbox is ticked in the employee details, tax conditions screen, Kwik-Pay will add employee KiwiSaver deductions to each employee's pay automatically. The deduction will be calculated at the default percentage rate (4% as at the start of the scheme).

The printed version of the Monthly Schedule, and the ir-file electronic file will include totals of KiwiSaver employee and employer deductions when the report is printed for pay periods after 1 July 2007.

Go to the KiwiSaver web site and the IRD KiwiSaver web site to see more information on the operation of the scheme and how it affects you.

Employer Contribution Tax Credits (after 1 April 2008)

For pay dates on or after 1 April 2008, Kwik-Pay will add a 'KiwiSaver Employer Contribution' to each employee's pay if the 'Add KiwiSaver deductions' checkbox is ticked in the payroll set up form and the employee has an employee KiwiSaver deduction and the employee is not a contractor (i.e. has a withholding tax deduction). Leave the units blank, and Kwik-Pay will use the correct percentage rate stored in the Tax Factors table. The employer tax credit will be calculated when the Monthly Schedule is printed and shown on the IR345 remittance advice report. The Monthly Schedule reports includes a KiwiSaver Employer Tax Credit Details report which lists the tax credits calculated for each employee.

If you operate a complying superannuation scheme and make employer contributions to that scheme, you will need to ensure that the pay item used to process the contribution in Kwik-Pay has a 'KiwiSaverApproved' property set on the pay item edit form. If you would like KwikPay to add your complying fund contribution automatically to each employee's pay, set the pay item's calculation type to 'KiwiSaver Employer' and set the priority of the pay item to be higher than the standard Kwik-Pay 'KiwiSaver Employer Contribution' pay item.

Note that the 'KiwiSaver Employer' calculation type for pay items retrieves a percentage rate from the 'KiwiSaverEmployerRate' tax factors. The tax factor will be updated in the normal Kiwik-Pay update cycle. If you wish to over-ride the percentage rate, you can enter a factor in the pay item setup screen for the pay item, or add the pay item to the employee's standard pay and enter the over-riding rate in the factor, or enter the percentage rate in the units field of the pay item when it is entered in the calculate pay form.

When the employer tax credit is calculated, the credits for employer complying contributions will be calculated on pay items that have the 'KiwiSaverApproved' property, whilst the tax credits for KiwiSaver contributions will be calculated on employer KiwiSaver contributions that do not have the 'KiwiSaverApproved' property (such as the standard KiwiSaver employer contribution defined in Kwik-Pay). If an employee has both complying and KiwiSaver employer contributions, the tax credits will be apportioned between the employer contributions in proportion of the complying and KiwiSaver contributions to the total employer contributions.

KiwiSaver Automation

Once you have completed the KiwiSaver employer requirements and you wish to start automating KiwiSaver employee deductions, select View, Setup, Payroll from the main menu in Kwik-Pay, select the Tax Details tab and tick the 'Add KiwiSaver Deductions' checkbox.

When the next pay period is opened, a KiwiSaver employee deduction will be added to each employee's pay automatically. The deduction will be calculated at the default percentage rate. For pay dates on or after 1 April, an employer contribution will also be added to the employee's pay.

Changing an employee KiwiSaver deduction rate

If an employee elects to pay a different rate from the default KiwiSaver rate, add a KiwiSaver employee deduction pay item to the employee's standard pay form (the Standard Pay tab in the Employee Details screen). Set the new standard pay item's factor to the percnetage rate to be deducted (set it to 8 in order to deduct 8% of the employee's gross pay). Note that if the factor is set to a rate greater than the maximum scheme rate (8% as at the start of the scheme), the deduction will be restricted to the maximum rate.

Employee KiwiSaver contribution holiday

If the employee wishes to take a contributions holiday, add a 'KiwiSaver Employee Deduction' pay item to the employee's standard pay tab and enter a stop date that is before the pay date of the first pay in which they are not to have a KiwiSaver deduction.

When the employee wishes to resume KiwiSaver deductions, delete the Kiwisaver pay item from the employee standard pay tab, and the next time a pay period is opened, a KiwiSaver deduction will be added to the employee's pay automatically.

Employer KiwiSaver contributions

If you are making contributions to a Superannuation fund that has been approved as a KiwiSaver complying fund, you need to ensure that it is flagged as such in Kwikpay, otherwise the contributions will have SSCWT calculated at full rate. Select View, Setup, Pay items from the main menu in Kwik-Pay and edit the superannuation pay item. In the Miscellaneous Properties area, add a new property and select KiwiSaverApproved from the drop down list of properties. Click ok to save the change.

If you are making employer contributions to the employee's default KiwiSaver fund, add a 'KiwiSaver employer contribution' pay item to the employee's pay calculation. If you add it directly to the 'calculate pay' screen, it will be calculated at the default rate (4% as at the start of the KiwiSaver scheme). If you wish to specify the percentage rate, add the KiwiSaver employer pay item to the employee's Standard Pay tab in their Employee Details screen. Enter the percentage rate in the 'Factor' field when adding the pay item to the standard pay.