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Four-minute round-up of 2017 law changes

From tax laws for contractors to Easter staffing rules, GST filing to ACC discounts, here’s a summary of what’s new and what’s changed for small businesses and the self-employed — check out which apply to you.

Minimum wage rates rise

When: 1 April 2017

What: The adult minimum wage rate has gone up 50c to $15.75 an hour. The starting-out and training rates have also risen by 40c to $12.60.

Why: Government must by law review minimum wage rates every year.

What you’ll need to do: If you pay your workers minimum wage rates, update your payroll and their employment agreements. If any workers are on starting-out or training wages, now is a good time to check when they’ll be eligible to move onto the adult rate.

Payment of wages (external link) — Employment Agreement Builder

New GST online services

When: Since 7 February 2017 

What: Manage your GST online using My GST, a new section of Inland Revenue’s myIR service. You can now:

  • pay your GST at the same time you file your return 
  • add file attachments online — no need to send them by post 
  • arrange GST instalment plans online 
  • sign up for email and/or text message reminders of due dates.

Why: This is the first of many changes Inland Revenue is making over the next few years to make tax simpler for you.

myIR (external link) — Inland Revenue

Cheaper ACC Work levies

When: Levy period 2017-2019

What: Whether you’re an employer or self-employed, your Work levy will go down by an average 10% over the next two years, compared to 2016/17 rates.

Why: ACC has improved their funding position for the Work account, allowing for a reduction in the Work levy.

What you need to do: Nothing. ACC will calculate your new levy, which will be in your next invoice.

But to help plan your budget, it’s a good idea to check what your new levy is likely to be, using ACC’s online calculators and downloading the levy guidebook.

Levy calculators (external link) — ACC

Current year’s levy rates, plus guidebook PDF (external link) — ACC

ACC safety discount ends

When: 1 April 2017

What: ACC’s Workplace Safety Discount (WSD) for small businesses and self-employed people has been discontinued. It was introduced 10 years ago as an incentive to put health and safety systems in place.

Why: Health and safety laws introduced in 2016 mean ACC has a new approach to helping businesses create safe and healthy workplaces.

What you need to do: Nothing. If you’re on the WSD programme, your discount will continue until its expiry date.

Workplace safety discount discontinued (external link) — ACC

Our new approach to workplace safety (external link)  — ACC

Shops trading on Easter Sunday

When: Easter 2017

What: Local councils may let shops in their district open on Easter Sunday. But employees can choose whether to work that day.

Why: There’s growing demand from the public and retailers to open for business on some public holidays.

What you need to do: If you are a shop owner, check with your local council if you can open on Easter Sunday. If you decide to open, you must give staff written notice of their right to refuse to work at least four weeks’ in advance but no more than eight weeks’ before Easter Sunday. If you haven’t done this already, it’s too late for Easter 2017.

Restricted shop trading tool (external link) — Employment New Zealand

Tax and contractors

When: 1 April 2017

What: All contractors can have tax deducted from their pay at a rate of their choosing. New Zealand tax residents can pick any rate from 10% up to 100%.

This is compulsory for all contractors hired by a recruiter — or other labour hire business — and those under previous schedular payment rules. Other contractors can opt in if their payer agrees to deduct tax on their behalf.

Tax rate estimation tool for contractors (external link)  — Inland Revenue

Why: To give contractors greater choice and make it easier to get tax right.

What contractors need to do: Fill out the new tax rate notification form (IR330C) if either:

  • you are hired and paid through a recruiter — otherwise you’ll have tax deducted at 45%
  • you were previously under schedular payment rules and want to change the rate of tax deducted
  • you start a new contract covered under the new schedular payment rules
  • you work directly for a business, would like tax deducted from your pay, and your payer agrees. 

Tax rate notification for contractors IR330C (external link) — Inland Revenue

What employers need to do: Give contractors the new tax rate notification form (IR330C) if:

  • they ask you to deduct tax from their pay and you agree
  • you previously hired contractors under the scheduler payment rules and they want to choose the tax rate they pay 
  • you are a labour hire business, eg recruitment agency, and must deduct tax from their pay.

Then update your payroll and add these contractors to your employer monthly schedule (EMS).

Interest charges for underpaying provisional tax are also changing

Use-of-money interest is charged if your end-of-year earnings are higher than projected in your provisional tax bill. From the 2018 tax year, new rules on when this is charged mean fewer people will have to pay it.

How interest rules apply (external link) — Inland Revenue

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