McLEAN AND CO. Chartered Accountants

Accounting          Taxation         Business Advice and Development Assistance           Audits                             

 P.O. Box 10 , Clive         133 Main Rd, Clive           Tel. (06) 8700952          Fax. (06) 8700955 

Email                                  Website


Welcome again to the McLean and Co. Newsletter in which we discuss current taxation and business matters. We trust you find it informative.  Any feedback would be welcomed.

McLean and Co. is a home based chartered accountancy practice based in Clive, Hawkes Bay.    Readers are invited to peruse the practice website lists services provided, gives contact details and indicates how to become a client, contains an extensive base of articles on business and taxation matters,  and has links to other websites that may assist your business.    Being a small firm itself,   McLean and Co. strives to provide a personal and professional service largely to a self employed person and small business client base.  Enquiries are welcomed.



We are happy to accept new clients.  Please contact ourselves at the contact points highlighted above if we can assist you in your accounting and taxation requirements. Our website lists information required for this in the following link:



  1. Kiwisaver.

  2. ACC Workplace Safety Discounts

  3. Reminder About Old Coins

  4. Residential Tenancies Reforms Announced




KiwiSaver is a voluntary, work based savings scheme announced by the Government in the 2005 Budget and due to be implemented 1 July 2007.  KiwiSaver is part of a wider Government initiative to help New Zealanders save for their retirement.  The information below is based on the KiwiSaver Act, which was passed into law on 6 September 2006.

From 1 July 2007, all New Zealanders under the age of eligibility for New Zealand Superrannuation (currently 65)  will be able to join KiwiSaver.  They can chose to have either 4% or 8% of their gross salary deducted automatically by their employer.   The 4% or 8% figure can include any contributions by employers.   People who decide to join KiwiSaver will have their contributions put into a KiwiSaver scheme provided by a Government registered provider.  The provider can be, in order of priority, the member's choice. the employer's choice, or a default provider if neither the member nor his or her employer makes a chioce.

Ther contributions will be "locked in" so they're not tempted to dip into them. although under certain circumstances (like serious illness, significant financial hardship, leaving the country permanently, or buying their first home) this will be allowed.   When they reach the age of elibility  for New Zealand superannuation, they'll generally have the option of withdrawing all or some of their balance as they wish.

After 12 months in the scheme, members will be free to pause their contributions by taking a contributions holiday for a minimum of three months, and up to five years at a time.  At the end of the chosen holiday period, contributions to Kiwisaver will automatically begin again unless the contributions holiday is renewed.

Participation in KiwiSaver may not suit everyone.  Some people may be concentrating on repaying debt or have other arrangements to save for their retirement.  However all employees aged between 18 and 65 starting a new job on or after 1 July 2007 will automatically be enrolled in Kiwisaver (with the ability to opt out between two to eight weeks after starting work if they wish).   Existing employees (along with self employed, beneficiaries and minors under the age of 18) can also decide to opt in.

The Government will make an up-front contribution of $1000 and provide a contribution towards members' administration fees.   This up-front contribution will not be able to be withdrawn to purchase a first home, in cases of serious illness or for significant financial hardship.


Employer Obligations- What  will you be required to do?

As an employer, you will be required to:

provide a KiwiSaver information pack (supplied by IRD) to all new employees, existing employees who join the scheme, and any employee who asks for one
automatically enrol new employees, (who have the option of opting out between two and eight weeks of starting work), in KiwiSaver
provide IRD with the details of new and exising employees who join KiwiSaver via your business
deduct employees KiwiSaver contributions from the salary or wages paid to employee members and forward them to IRD along with PAYE

There are a number of options open to your business under the KiwiSaver Act.   You can choose whether to:

make employer contributions to KiwiSaver.  Employer contributions to KiwiSaver will be exempt from Specified Superannuation Contribution Withholding Tax (SSCWT Tax) subject to a cap of the lesser of the employee's contribution or 4 per cent of their gross salary or wages
elect a KiwiSaver provider for your employees who do not select their own.  If you elect a chosen KiwiSaver scheme for your employees, you will be required to provide an investment statement for that scheme to all new employees and those who opt in
apply for an exemption from the automatic enrolment requirements if you have an existing registered superannuation scheme that meets certain criteria
establish a KiwiSaver scheme within your current superannuation scheme
convert your current superannuation scheme to a KiwiSaver scheme.   This may require the consent of all existing members of the current scheme, unless the benefits of the KiwiSaver scheme to which they would be transferred would be equivalent to or better than those relating to their current scheme.


Employee Questions Answered

How will KiwiSaver affect me?

KiwiSaver gives you an opportunity to make regular payments to a savings scheme.  You can choose not to join KiwiSaver and you will only be formally offered to join if you change employers.  You can opt into a KiwiSaver scheme, and you do this by contacting your payroll administrator, or another  registered  provider directly.

Is it a requirement that all employers offer KiwiSaver to new employees?

No.  Although most employers will have to provide their employees with access to KiwiSaver, there are some exceptions;
employers with an exempt superannuation scheme
employers who do not pay employees via the PAYE system, and 
employers who do not have employees resident in New Zealand.


Who is eligible to join KiwiSaver?

Any NZ citizen or person entitled to be in NZ under the Immigration Act, who is under the age of eligibility for NZ Superannuation (currently 65 years) can join KiwiSaver either when they start a new job, or if they choose to join.  Only a natural person can be a member, which means you can’t put your membership of KiwiSaver into the name of a family trust or company.


When does automatic enrolment in KiwiSaver apply?

You will be subject to automatic enrolment in KiwiSaver when you start a new job, subject to the exclusions listed below.

You will not be eligible for automatic enrolment in KiwiSaver if you;
are under 18 or over NZ Superannuation eligibility age (currently 65),
have changed job on same payroll (ie: promotion),
are on a new payroll but the new employer is carrying on the same business and the IRD has been notified (ie: takeover of a company),
are not paid through the PAYE system (ie: contract workers),
are already a member of KiwiSaver (you must disclose this and provide a KiwiSaver deduction notice to your new employer), 
are a casual agricultural worker employed for less than 3 months, 
are employed for a short term (less than 4 weeks), ie: temporary or contract workers paid through the PAYE system, 
are not a New Zealand citizen or entitled to be here indefinitely under the Immigration Act 1987.

What if I don't want to join KiwiSaver?

If you don’t want to join KiwiSaver and have gone through the automatic enrolment process, you need to fill in the opt out form provided in the KiwiSaver information pack and give it either to your employer or direct to the IRD.


What if I already belong to an existing superannuation scheme?

You can keep making contributions to an existing scheme as required.  If the scheme allows it, you may be able to make KiwiSaver contributions to this scheme, or you can also contribute to a separate KiwiSaver scheme.  Should you do this, these contributions could be on top of the existing superannuation scheme’s required contributions.

What other features of KiwiSaver should I know about?

The government will provide a $1,000 “kick-start” contribution for each new member, together with a subsidy on fees (the amount of fee subsidy is still to be determined). 

They are also offering a first home buyers deposit subsidy after 3 years, to a maximum of $5,000 after 5 years membership (calculated at $1,000 per year for a maximum of 5 years).

If you have a mortgage and you have been a member of KiwiSaver for at least 1 year, you may request that up to half of your contribution (but not your employer’s contribution) is used to help pay the mortgage on your family home.

Employer contributions to a KiwiSaver scheme will be exempt from tax, subject to a cap of the lesser of any contribution you make or 4% of your gross salary and wages.

You cannot withdraw money from KiwiSaver until the later of your attaining the age of eligibility for NZ Superannuation (currently 65) or 5 years membership, except in certain limited circumstances.  These include:

significant financial hardship or serious illness,
purchase of a first home, 
a settlement under the Property (Relationships) Act, or
permanent emigration.


How will I know when my contributions have been received safely by the IRD, passed to my chosen provider and invested?

IRD is planning a website for employees to view their contributions that have been paid. 

KiwiSaver providers will issue a ‘welcome letter’ to new members within three business days of receiving the member’s information from the IRD.

Within three business days of the initial contributions being received from the IRD, KiwiSaver providers will be required to issue an initial opening statement to KiwiSaver scheme members.  This will be after 90 days from the first contributions being deducted from your pay as contributions initially go to the IRD, who hold them for 3 months before paying to the provider.  Interest on contributions will be paid by the IRD for this period.


What ongoing reporting about my savings will I receive?

Providers are required to provide annual members’ statements.  Other service standards will apply to deal with changes to information and members’ questions.



Workplace Safety Discounts is a way to save 10% off the work levy for some small businesses and self employed people who can show sound health and safety practices.
Currently the programme is available in agriculture, construction (residential), fishing, motor trades and road transport. Check back on this site for more information on other industries throughout October.


How much is the discount?

The discount is 10% of the work-related component of your levies. The total amount of the discount will depend on the levies you pay. The discount applies for three tax years from the date your application is accepted, although you’ll be required to complete an annual declaration during that time to confirm your details. You’ll also be playing a valuable role in keeping injuries out of your workplace.

When will I get the discount?

As long as you apply before the end of March 2007, if your application has been accepted then your discount will apply from 1 April 2006. If you have already paid your levies during this time, you will receive a refund.

What do I have to do?

To qualify you need to be eligible and show you have capability in health and safety management, which generally means completing a FREE industry-specific training course (typically just one or two days in duration), then returning a correctly completed self-assessment booklet to ACC.


Fron 1 November the old 50,20,10, cents coins will no longer be accepted by shops and businesses.  Furthermore the 5 cent coin will be taken out of circulation.  The Reserve Bank of New Zealand (via the major trading banks) will still accept them.




The government has unveiled proposed changes to the Residential Tenancies Act which will impact on what landlords and tenants can do.

Building Issues Minister Clayton Cosgrove has announced proposed amendments to the Residential Tenancies Act and to landlords’ and tenants’ advice and dispute resolution services.

“The key issues identified in the review of the Act included a lack of stable tenure for longer term tenants, variable standards of rental housing and a lack of knowledge among landlords and tenants on their rights and responsibilities," Cosgrove said.

Proposed amendments include new property entry rights for landlords for the purposes of an appraisal by a real estate agent or building inspector, and allowing landlords to recover reasonable debt collection costs incurred in enforcing Tenancy Tribunal Orders through a private debt collection agency.

It is also proposed to make some tenant breaches unlawful acts that can result in exemplary damages being awarded, as an alternative to eviction. These would include sub-letting, assigning a tenancy without consent, over-populating the premises or becoming a problem neighbour.

The government has also instructed the Ministry of Justice to examine faster and easier ways for landlords to collect unpaid rent.

It is proposed that the Tenancy Tribunal be able to make an order against a guarantor of a party to a tenancy agreement. Currently if a landlord wishes to pursue the guarantor to a tenancy agreement (eg for rent arrears) they cannot go to the Tenancy Tribunal – they must go to a District Court or Disputes Tribunal.

Landlords who breach building health and safety regulations may face financial penalties payable to the tenant.

Greater protection for fixed term tenants is proposed by compelling landlords to notify tenants at least three weeks before the tenancy period ends if they are not going to renew the contract. Fixed term tenancies that expire with no new agreement being signed will automatically become periodic tenancies, whereby tenants must give three week’s notice if they want to end the tenancy and landlords must give three month’s notice.

Fixed term tenants will also be allowed to apply to end a tenancy early, in the event of a substantial and unexpected rent increase.

Landlords who intend being abroad for more than three weeks will be required to appoint someone in New Zealand to manage their tenancies for the duration of their absence.

A draft bill will be developed for Parliament to consider next year.

In addition to the legislative amendments, there will be changes to the Department of Building and Housing’s tenancy advice and dispute resolution services. The new measures include face-to-face services in more locations throughout New Zealand, an online application service and telephone mediation.

The service changes include:
· Extended hours for phone advice: 8am to 5.30pm weekdays instead of 8.30am to 4.30pm
· New Tenancy Tribunal application forms
· Access to face-to-face services in 17 more locations throughout New Zealand
· A new phone mediation service to resolve straightforward disputes
· The introduction of online applications to the Tenancy Tribunal.

In total there are now 85 centres where landlords and tenants can sit down with a mediator, get advice or pick up resources. The additional community venues, which will now provide services by appointment, are located in Putaruru, Mangakino, Murupara, Te Kuiti, Kawerau, Opotiki, Turangi, Paraparaumu, Hornby, Rangiora, Amberley, Waimate, Hokitika, Fairlie, Twizel, Alexandra and Wanaka.

A phone mediation service, ‘Swift’, has been set up to resolve straightforward tenancy disputes within 24 hours. An example is an application for rent arrears where both the tenant and landlord agree that the rent is behind and they require mediation to reach an agreement about how the arrears will be paid.

Other reforms currently under way across the building and housing sector include: the review of the Building Code, the licensing of building, auditing and accrediting building consent authorities, changes to the Weathertight Homes Resolution Service, the introduction of a financial assistance pilot for the worst affected owners of leaky homes, product certification and investigating a home warranty insurance scheme.





The information provided in this email newsletter is for informational purposes only.   McLean and Co. accept no responsibility for the opinions and information expressed in the information provided and it is provided "as is" without warranty of any kind.    The user assumes the entire risk as to the accuracy and use of this document.   Readers are asked to seek professional advice pertaining to their own circumstances.    The McLean and Co. email newsletter may be copied and distributed subject to the following conditions:
All text must be copied without modification and all pages must be included.
This document must not be distributed for profit.    


If we can assist further, please email McLean and Co as follows: