Are you ready for payday filing?
The payroll processes will be getting more streamlined for business owners and payroll teams, as changes to the IRD's payroll information filing come into effect, simplifying the way employers file tax information for their employees.
The changes mean employers will file an Employment Information Schedule every payday, instead of the Employer Monthly Schedule (IR348) each month as they've previously been doing. Employers have had the option to use the new payday information filing system since April 1, 2018. It will become mandatory from April 1, 2019.
Inland Revenue's commitment to making tax more straightforward is the motivation behind the change. The new system will make it simpler and faster for businesses to meet their tax obligations. Filing tax information every payday makes the payroll process seamless, as all payroll tasks will be completed at one time. Rather than have an extra task to do on the 20th of each month, the payroll team can now integrate the processes seamlessly into their existing payroll procedures.
Inland Revenue is making changes to the IRD's payroll information filing system which will simplify the way employers file tax information for their employees.
As Inland Revenue will receive tax information more regularly, IRD staff will have the ability to provide employees with timely access to the information they require, such as Working for Families Tax Credits, student loan repayments and Kiwisaver contributions.
Many businesses are already using payday filing compatible payroll software, which allows information to be automatically sent to Inland Revenue or uploaded to myIR, a painless way to complete payday filing. Employers paying $50,000 or more per year in PAYE/ESCT (Employer Superannuation Contribution Tax) will need to payday file electronically, either by using their payroll software or through myIR. If PAYE/ESCT deductions are less than $50,000 per year, employers may choose to file on paper, however, paper filers can't switch to payday filing before April 2019 unless they change to electronic filing.
With payday filing, it will no longer be necessary to file an employer monthly schedule. Payday filing starts from the beginning of each month.
The Inland Revenue Department are holding seminars throughout New Zealand, as well as webinars and videos on the IRD website, to assist businesses with making the change to payroll filing.
Payday filing has been developed so Inland Revenue can work efficiently with employers, employees and payroll teams, using a system which is easy to navigate and lessens the burden of meeting their tax obligations, so business owners can get on with growing their businesses.