Proposed changes to PAYE reporting

Our government is currently busy improving the way we report on PAYE to make things simpler for Employers. Over the next few years, all EMS Schedules (Employer Monthly Schedule) will be replaced by payday reporting. What this means is New Zealand employers will need to ensure they are compliant on or before 1 April 2019 by upgrading or replacing their current payroll system.

The PAYE information filing process will be integrated into your payroll software you use Employers would then file their PAYE information each payday directly from the payroll software.

Why the change?

This is simply to make tax easier for the Employer. It means Employers will no longer be required to file their EMS, and all new employees will be able to complete an easy-to-understand online form which meets the requirements for both the tax code declaration IR 330 and KiwiSaver deduction KS2.

With just a single online form in place, this will result in a streamlined process which will aleviate information repetitions and provides a single source of employee information – details such as a person’s name or IRD number will not be repeated.

Who does this affect?

Employers with $50,000 or more of PAYE and ESCT deductions a year have the option to file their PAYE information each payday from 1 April 2018 and will be required to do so from 1 April 2019.

Employers with more than $500,000 a year of PAYE and ESCT deductions will continue to pay their PAYE and other deductions twice a month, by the 5th and 20th. All other employers will continue to pay their PAYE and other deductions by the 20th of the following month.