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McLEAN AND CO.
GST Late Filing Penalties
Company Annual Return Filing Change
Changes to the Minimum Wage from 1 April 2008
PROVISIONAL TAX DUE DATES- IF YOUR IRD NUMBER IS NOT GST REGISTERED
In previous Newsletters we have discussed Provisional Tax Due dates and the incorporation of payments with GST Returns under new regulations. If the taxpayer is not GST registered (e.g. you have a company or partnership which is GST registered and income is allocated to you individually and you pay the income tax against your personal IRD Number, and you personally are not registered for GST) then you won't work out Provisional Tax to pay in conjunction with your GST Returns (as these are specific to the GST registered entity) but instead you will pay Provisional Tax due separately as has been the previous custom.
Due dates are:
|BALANCE DATE||PREVIOUS DUE DATES||NEW DUE DATES|
|March (the vast majority of taxpayers)||7 July
EMPLOYER MONTHLY SCHEDULE NON-PAYMENT PENALTIES
New legislation has been introduced to encourage employers to pay tax associated with the Employer Monthly Schedule (EMS) on time.
From 1 April 2008 , an employer who pays their tax after the due date may incur a penalty of 10% of the unpaid tax. IRD will send a reminder notice when the payment is due before any penalty is applied. If an employer incurs a non-payment penalty, it will reduce to 5% if they pay the tax owing or enter an instalment arrangement within one month of the date printed on the notice. An employer who doesn't pay their overdue tax or contact IRD will incur further non-payment penalties each month until the tax is paid. The maximum penalty is 150% of the overdue tax.
KIWISAVER COMPULSORY EMPLOYER CONTRIBUTIONS
From 1 April 2008 employers are required to contribute to your employees savings in KiwiSaver schemes and complying superannuation funds, if the employee is a member of these.
The initial contribution rate is 1% of gross salary or wages.
You need to make contributions if an employee:
The contributions are included in the "KiwiSaver Employer Contributions" column of the Employer Monthly Schedule (IR 348).
KIWISAVER EMPLOYER TAX CREDIT
From 1 April 2008 you can claim a tax credit of up to $20 per employee per week if you contribute to your employees KiwiSaver schemes or complying superannuation funds. You can offset the tax credit against the Employer Deductions Form (IR345) form and pay the net amount to IRD.
Providing you make an employer contribution in the PAYE period, you can claim the lesser of the :
You must work out individually the amount of employer tax credits you can claim for each of your employees and keep a record of your calculations. Ensure that you keep the workpaper for this calculation and attach it to your copy of the IR 345 Employer Deductions Form.
If you paid more in Employer Contributions in a particular month then the balance is claimable as an expense when preparing your yearly Business Financial Statements.
THUS IT IS IMPORTANT TO KEEP AND RETAIN FOR PRESENTATION TO THE ACCOUNTANT AT YEAR END:
The following describes the calculations:
IT IS IN YOUR INTEREST TO CLAIM THE EMPLOYER TAX CREDIT AVAILABLE ON THE IR 345. THE REASON FOR THIS IS THAT THIS IS A STRAIGHT CASH REIMBURSEMENT AND ALSO WITHIN A SHORT PERIOD OF TIME AFTER YOU HAVE PAID THE EMPLOYER CONTRIBUTION. THE SURPLUS ($111.45 AS ILLUSTRATED IN THE PRECEDING EXAMPLE) IS NOT CLAIMABLE UNTIL A FUTURE DATE WHEN YOUR BUSINESS FINANCIAL STATEMENTS ARE PREPARED, AND THE TAX BENEFIT YOU GET FOR THIS LATTER AMOUNT WILL BE BASED ON YOUR MARGINAL TAX RATE (THAT IS, LESSER THAN DOLLAR FOR DOLLAR)
GST LATE FILING PENALTIES
From 1 April 2008 a GST registered person who files their GST Return late may incur a late filing penalty. From that date, if a registered person does not file their return on time. IRD will send a letter reminding them that their return is overdue.
If within a following 12 month period after the reminder notice is issued a sunsequent GST Return is not filed on time a late filing penalty will be charged and the person notified.. The amount of the penalty will be $50 for someone on the payments basis or $250 for taxpayers on the invoice or hybrid basis.
COMPANY ANNUAL RETURN FILING CHANGE
The Companies Office will no longer be accepting manually-filed annual returns from 1 July 2008. From that date such returns will only be able to be processed online on the internet.
From the 1st of April 2008 there is no longer a youth minimum wage. Instead there is a minimum wage for new entrants that applies to some employees aged 16 or 17. Other employees aged 16 years or over are entitled to the adult minimum wage.
Who is a New Entrant?
is 16 or 17 years of age; and
has not completed 3 months or 200 hours of employment, whichever is shorter; and
is not supervising or training other workers; and
is not subject to the minimum training wage
When will the adult minimum wage
apply to a 16 or 17 year old employee?
do not supervise or train other employees, and
are not subject to the minimum training wage, then
The adult minimum wage will apply to them when they have completed 3 months or 200 hours of employment after turning 16 years of age. For example, an employee who has done 250 hours of work before they turn 16 years of age is still considered to be a new entrant after the 1 April 2008.
If your employees are 16 or 17 years of age and are not subject to the minimum training wage, but they are supervising or training other employees as part of their jobs, then the adult minimum wage will apply to them from the 1 April 2008, regardless of the number of hours they have worked or how long they have been employed.
Minimum Wage Rates from 1 April 2008
Employees under 16 years old
there is no statutory minimum wage
16 or 17 year olds
If the employee meets the criteria to have the adult minimum wage apply: $12.00 an hour before tax. If the new entrants wage applies: $9.60 an hour before tax
Employees aged 18 and over
Adult minimum wage $12.00 an hour before tax
$9.60 an hour before tax
|McLEAN AND CO KNOWLEDGE CENTRE AND ARTICLES ABOUT TAXATION AND BUSINESS IN GENERAL PRESS HERE||FOR BUSINESS STARTUP KNOWLEDGE CENTRE PRESS HERE|
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