Employers reminded: be ready for Oct 1 tax changes

MEDIA RELEASE

19 September 2008

Employers reminded to be ready for October 1 tax changes

Inland Revenue is advising employers that they need to be ready to start using the new tax rates from October 1.

Changes to PAYE rates take effect from that date, meaning employers will need to use the new rates for pay periods that end on, or after, October 1.

Group Manager Assistance, David Udy, said Inland Revenue had already issued updated PAYE deduction tables to all employers.

“We have worked with payroll providers and companies to ensure their software takes account of the new rates.’’

If people are self-employed and pay provisional tax the changes to personal income tax rates will affect them too, he said.

The current and new tax rates for PAYE are:

Tax rates until 30 September 2008+ / Tax rates from 1 October 2008 to 31 March 2010*
15% on income to $9,500 / 12.5% on income to $14,000
21% on income between $9,501 and $38,000 / 21% on income between $14,001 and $40,000
33% on income between $38,001 and $60,000 / 33% on income from $40,001 to $70,000
39% on income over $60,000 / 39% on income over $70,001

+ takes into account the effects of the low income rebate
*Not including ACC earners levy.

The tax code declaration (IR 330) form has also been updated and
employers need to have the new form available for employees from 1 October.

More information can be found about all these changes, their implications, and the updated PAYE calculators at www.ird.govt.nz.

ENDS

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