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April 2022 Payroll Updates

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April 2022 Payroll Updates

End of Financial Year Payroll changes

The end of the financial year is fast approaching, and with that comes some important payroll and tax changes.

These will affect all employee’s regardless of if they are on the current minimum wage or not.

From 1 April 2022 the Minimum Wage, ACC Earners Levy and Student Loan Deduction rates and thresholds will all change.

Keep an eye out for your payroll software releasing an update to deal with these changes. All payroll software needs to be updated before the first pay run in the new year.

 

Minimum Wage Changes - April 2022

Employees earning the minimum wage can expect to be paid $1.20 more an hour as the minimum wage jumps from $20.00 to $21.20 per hour. Over 300,000 workers in New Zealand will be directly affected by this jump, making an extra $2,500 a year.

The training and starting-out minimum wage will also increase from $16 to $16.96 per hour.

These changes are effective for any hours worked from 1 April 2022.

If you have employees on the minimum wage, starting-out wage or training wage, you will need to make sure you update their pay rate in your payroll system.

 

ACC Earners Levy

From 1 April 2022 Kiwi employers will be taking a little more out of their employees’ wages to cover the ACC Earners Levy. This change also applies if you’re self-employed, a shareholder-employee or contractor. 

ACC Earners’ levies will increase from $1.21 per $100 to $1.27. With GST this new levy is effectively $1.46 in every $100, or 1.46%.

Once your payroll software has been updated for the 2022 year, these changes should come into effect and you won’t need to change anything manually in the system.
However, if you’re paying employees using automatic payments set up directly with your bank, you’ll need to adjust these to accommodate the new rates.

 

Student Loan Deduction Rates and Thresholds

Some Kiwis with student loans will gain a few more dollars on their pay check before paying off their student loan.

The student loan repayment threshold will increase by $988 from $20,280 to $21,268 on 1 April 2022.

 

Time to review your payroll settings

The start of a new financial year is a great time to review the settings in your payroll software to make sure everything is up-to-date. 
This includes current employee work patterns and leave entitlements. 


Get in touch with any of the admin team if you need some assistance with this.

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