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Accumulus Newsletter - January 2019                                                                                                                                                                                               

1. PAYDAY FILING

Payday filing is mandatory for all employers from 1 April 2019. 
If your annual PAYE and ESCT payments are above $50,000 annually you must file electronically, below this level manual paper copy filing is acceptable.

Manual Paper Copy Filing must be completed
- within 10 days of every payday or
- twice monthly within 10 days of the 15th of the month and the end of the month.
The start date cannot be before April.

Electronic filing must be completed
- online within two working days of every payday.
You can elect to start payday filing before April, simply by starting to file accordingly, but having started you must continue. (Not all software providers are already set up for payday filing.)

Payment Dates
There are no changes to current payment due dates or the way you pay - pay monthly or twice-monthly like you do now. 

Payday filing cannot be done through the ir-File service in myIR. If someone currently files your Employer monthly schedule (IR348) this way you will need to reset their access so they can file through the Payroll returns account. You can only do this if you're the account owner. (You will no longer need to file an Employer deductions schedule (IR345).)

Above are the principal facts but there is much more detail on the mechanics on the IRD
website. For those that need the detail please click on the following link:

IRD also have a number of helpful YouTube videos which can be accessed through the link below or by following links contained in the above address for relevant topics.


Accumulus will ensure that all client payrolls which we file comply with the above deadlines and filing requirements.

The following are the main software providers that we use and their present status as regards payday filing:
- MYOB ACE Payroll In progress ETA February
- MYOB Essentials In progress ETA February
- Smart Payroll * Before April
- Thankyou Payroll * Before April
- Xero Payroll In progress ETA before April

*These providers take the gross pay and deal with all payments & filing so customers are unlikely to notice any difference anyway.

If you have any questions regarding Payday Filing please contact one of our payroll team, Melissa Campbell, Renae Mohi, Sheryl Sutton, Tracey Body, or Viv Proffitt.           


2. SALARY AND WAGE EARNERS

Minimum Wage
From 1 April 2019 the adult minimum wage is being increased to $17.70 (from $16.50). The starting out and training wage is being increased to $14.16 (from $13.20).

Tax returns – no filing required?
If individuals have income beyond wages and salaries and interest they will need to file an IR3 as is presently the case.

Otherwise from April 2019 IRD will issue refunds or assessments based on the income information that they have on their system. 

IRD will automatically send taxpayers an Income Tax Assessment notification to finalise their end-of-year tax information. (It will no longer be necessary to request and confirm a Personal Tax Summary to get a refund.)

Refunds will be paid directly into bank accounts and any tax to pay will be due by the next 7 February (for those taxpayers that do not have a tax agent). Cheques won't be issued so you will need to ensure IRD have your correct bank account details.

At a stroke the government is wiping out the "Woohoo" online tax refund industry that they allowed to develop a few years ago!

           
 
3. TAX WORKING GROUP

The tax working group interim report on the NZ Tax System came out in September. One of the big issues under consideration was the possible introduction of a more comprehensive Capital Gains Tax. Although no decision has yet been made on this the ring fencing of rental losses is now part of a bill going through Parliament see below. 

 
 4. RING FENCING OF RENTAL LOSSES

A tax Bill presently at the select committee stage in Parliament contains provisions for the ring fencing of rental losses from 1 April 2019.


This means that rental losses will not be available to offset against income from other sources, but instead will carry forward in the hands of the taxpayer until such times as there are rental profits against which this can be offset. 

Rental profits and losses are not tied to specific properties so that a loss from one property can be offset against a profit from another property.

For taxpayers with more than one rental property the expectation is that they will be assessed on a portfolio basis though there is provision to elect to have properties taxed separately.

This ring fencing negates the particular advantage gained by taxpayers with loss making rentals owned by Look Through Companies with the shareholding skewed in favour of the higher income earner.



If you have any questions please get in touch with us.


Regards
Alan Dodwell