Short answer: Yes, they become part of the employee’s gross earnings. NZPPA has been in discussion with IRD on this since these new payments were announced and have had it confirmed that both the Wage Subsidy and leave payments are gross payments and PAYE is to be deducted along with all deductions (student loan, child
Archives: PayTalk
Example of how the Government Wage Subsidy and Leave Payment is taxed
The wage subsidy and leave payment are subject to tax and become part of gross taxable income for the employee. Example of the Wage Subsidy: A full-time employee (working more than 20 hours per week) would normally be paid $1000 gross per week. The company has been hit hard from the COVID-19 pandemic and applies
THE “NOTS” OF THE HOLIDAYS ACT ARE STILL NOT UNDERSTOOD!
I get questions every day on the Holidays Act and I am amazed that the fundamentals are still not understood, or for whatever reason are not being correctly applied to payroll. I do not see this as a fault of the Act as these areas are quite clear and could easily be applied to make
HOW CAN YOU RUN PAYROLL WHEN YOU DON’T KNOW IT?
I spend a lot of time explaining why things need to be done a certain way in payroll to senior managers and even payroll practitioners. It’s required to ensure compliance, best practice, reduce the cost of processing and security etc. In a lot of cases, there is no understanding on their part of the importance
CAN YOU PAY LESS THAN THE MINIMUM WAGE FOR LEAVE PROVIDED UNDER THE HOLIDAYS ACT?
The short answer is YES. Now, this is not about the bad employer exploiting the downtrodden, overworked employee, this is just a consequence that can happen because of the averages used or that could be used under the Holidays Act. Before I get a lot of comments about social conscience and the living wage, I
WHAT’S IN STORE FOR NZ PAYROLL IN 2020?
Another year, another set of challenges for payroll! After the year of delivery (I did not see anything for payroll!), we now face a year of uncertainty. The things that the government has stated will be released may or may not be implemented depending on who is in power after the election. Now, please understand
WHY THE HOLIDAYS ACT REVIEW HAS FAILED EVEN BEFORE IT’S RELEASED!
Author: David Jenkins, NZPPA CEO We are still waiting on the Minister to release the Holidays Act Review Report, which after several delays was provided to him in early October 2019. NZPPA and a small group of payroll providers were involved in a meeting before the report was forwarded to the Minister. At that meeting
THE ANNOYING QUIRKS OF IRD’S NEW MYIR TAX WEBSITE
A good way to gain a working understanding of the complicated New Zealand tax system and how hard it is to develop IT systems that allow users to interface painlessly is to log into the new myIR website and, well, use it to keep up with your obligations. The oddly capitalised myIR is the realm
EMPLOYERS SHOULD HAVE TO CONTRIBUTE TO KIWISAVER EVEN WHEN STAFF DON’T; FINANCE INDUSTRY
The minimum employer contribution to KiwiSaver should be lowered from 3 per cent to 2 per cent or an employer should be required to put money in regardless of whether their staff member does, a new report by the finance industry recommends. The Financial Services Council, an industry body made up of banks and insurers
TRUCK DRIVER FIRED ‘OUT OF THE BLUE’ AFTER QUESTIONING HOLIDAY PAY
A truck driver fired “out of the blue” a month before Christmas, has been awarded $22,800 for unjustifiable dismissal. Stephen Taylor worked at Farm Beach Transport Limited from April 2018 til November 2018. On November 22 he noticed on his payslip that he had been paid for a week of annual leave rather than his normal wage,
Debt collectors chasing employers for payments to exploited workers
Employers who ignore orders to compensate exploited workers can expect a visit from debt collectors. The Ministry of Business Innovation and Employment (MBIE) set up the debt collection unit about six months ago and Labour Inspectorate national manager Stuart Lumsden said it was just starting to hit its stride. He said a legislation change in 2016
12 PRACTICAL WAYS TO REDUCE WORK FOR NZ PAYROLL
So, now for something completely different. I always say at the start of any training session I run that I am not politically correct. And in today’s world, in my view, being politically correct is way over the top. I find payroll challenging, hard work and I love it with a passion, but I have
Student loans vanish from screen after Inland Revenue upgrade
Some taxpayers have seen their student loans seemingly disappear after Inland Revenue’s website came back online on Friday following a technology upgrade. A former student who now lives in Germany was among those who got a nice, but short-lived, surprise when her $14,000 student loan appeared to vanish. The woman joked that the upgrade – part of Inland Revenue $1.6 billion Business Transformation programme – was definitely working for her. Another
Four Types of Dangerous Payroll People
Yes, I mention this a lot in my posts, but payroll is a business-critical activity. It manages one of the largest costs a business has which is the cost of paying employees. NZPPA was formed to develop payroll as a profession in New Zealand and we are slowly doing that one win at a time.
Wendy’s fails to meet payout deadline for workers not given lieu days
Former Wendy’s employees owed thousands by the fast food giant following an Employment Relations Authority (ERA) ruling are still waiting on payment. Remediation payments for days in lieu not provided to former employees were supposed to be paid by March 31. Credits for days in lieu not provided to current staff were due to be
9000 Corrections staff to get holiday pay arrears this year
It expects a $16 million contingency it got in last year’s Budget should cover its liabilities to more than 9000 staff underpaid due to leave and shiftwork miscalculations. “We are determined to get this right for our staff and aim to begin paying any shortfalls in late 2019,” Richard Waggott, deputy chief executive corporate services,
CANNOT USE AVERAGING FOR TIME IN HOLIDAYS ACT REMEDIATION
One of the key concepts of the Holidays Act is a week for annual holidays and a day for the other types of leave provided under the Act. A week is by agreement and if the week changes, the entitlement changes to reflect the new agreed week. In this post I want to highlight some
SHOULD DOMESTIC VIOLENCE LEAVE BE IN PAYROLL?
The short answer is yes. It is interesting to see the wide range of variations in terms of what payroll providers are doing with domestic violence leave (DVL) in their payroll systems from the 1st April 2019. These include the following: stating they will not be adding or providing any support for DVL in their
DHBS UNSURE HOW TO PAY POSSIBLE MILLIONS OWED TO STAFF
NZPPA note: the present Holidays Act review is about going forward, it will not resolve the issues the DHBs have with underpayments that have happened in the past, we still have that nighmare in payroll. District health boards say that having to pay wage and salary arrears could have a significant financial impact
PAYROLL STAFF NEED HELP AS COMPANIES STRUGGLE WITH UNDERPAID HOLIDAYS
Businesses need to take a hard look at the job of their often low-paid and overwhelmed payroll staff, says a top employment lawyer, as New Zealand continues to grapple with the nightmare of historical holiday leave underpayments. Ernst Young (EY) Law employment law leader Christie Hall said new holiday pay and leave legislation is still