Tax on KiwiSaver (ESCT)

The monthly IRD reports are causing some confusion for clients running a computerised Payroll program. The schedule doesn’t include a column for the ESCT tax but the remittance advice does.

The Employer monthly schedule (IR348) prints figures for Gross Earnings, PAYE, SL, and KiwiSaver. It doesn’t show the tax (ESCT) on the Employer contribuion.

See the screen below (click on the image to enlarge)

 

 

The Remittance advice (IR345) prints all figures (including the ESCT tax). You must pay the amount circled in red. See the screen below:

 

 

It is very important you print and use both forms above. Some employers are just printing the IR348 and underpaying the IRD by the ESCT (the IRD don’t like that..!)

 

    Lynley Averis

    Lynley is an MYOB Certified Consultant & has been involved in training in New Zealand since 1985. She's written various accounting & MYOB workbooks including co-authoring “Bookkeeping for Dummies”. She has consulted on all versions of MYOB Accounting, Retail and Payroll over the past 18 years and has previously worked for MYOB.She currently consults to NZ businesses on all aspects of business systems - her mission for clients is for them to spend as little time as possible doing accounting.