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Payroll Update

Important Employer Tips for the 1st April Changes

Minimum Wage Increase

On the 1 April 2023 the minimum wage will increase to $22.70 per hour. This rate applies to all employees 16 years and over. The starting-out and training hourly minimum wage rates will increase to $18.16 per hour, remaining at 80% of the adult minimum wage.

Refer: https://www.employment.govt.nz/about/news-and-updates/minimum-wage-increasing-1-april-2023-are-you-ready/

Salaried employees – check for Minimum Wage requirements

If you have salaried employees, you need to make sure that their Gross Earnings meets minimum wage requirements for each individual pay period.

Any employees’ earnings below or around $47K per annum should be reviewed.

Employees must be paid at least the minimum hourly wage rate for every hour worked.

Top Tip: ($47,216 / 52 weeks / $22.70 per hour = 40 maximum working hours)

Employees currently on the Minimum Wage or just above

We recommend that you review all employees pay rate bearing in mind the Minimum Wage is increasing by 7%. Where possible this could be a consideration for increasing other employee’s wage rates.

Living Wage

The Living Wage rate is voluntary and currently $23.65 per hour. A living wage is the income necessary to provide employees and their families with the basic necessities of life, enabling them to live with dignity and to participate as active citizens in society.

Refer: https://www.livingwage.org.nz/about

ACC Earner Levy increase

From 1 April 2023 the ACC Earner Levy will increase from 1.46% per $100 liable earnings to 1.53% per $100.

Refer: https://www.ird.govt.nz/income-tax/income-tax-for-individuals/acc-clients-and-carers/acc-earners-levy-rates

Top Tip: Remember to update all employee net pay automatic payments  

Student Loan Threshold Change

The Student Loan Threshold from 1 April 2023 to 31 March 2024 will increase to $439 per week.  Check your payroll software or check the calculations through the PAYE Calculator and update the filing period to 31 March 2024. The IR online calculators will be updated late March/early April.

Refer: https://www.ird.govt.nz/employing-staff/deductions-from-income/deductions-from-salary-and-wages

Top Tip: Remember to update all AP’s of employees with Student Loan deductions

 KiwiSaver Annual ESCT Review – 1 April each year

At the first pay run of the new financial year, as an employer you are required to review each employee’s ECST rate to ensure that the rate is correct.

Refer: https://www.ird.govt.nz/employing-staff/deductions-from-income/employer-superannuation-contriibution-tax-esct/deduct-esct-from-each-employer-contribution

Top Tip: To calculate this = Total Gross Earnings + Employer KiwiSaver contribution in the last 12 months

The Accounted Payroll Team



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