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|Pay as you earn (PAYE)
As an employer, you must:
|Pay as you go (PAYG) withholding
If you make payments from which withholding is required, eg wages to employees or payments to businesses that do not quote an ABN, you must register with the ATO before you first withhold.
Find out more about Pay as you go withholding (PAYG withholding) essentials
|Tax is deducted from schedular payments (formerly withholding payments) made to people who are not employees but work for you on a contract-for-service basis.
Withholding tax is not generally deducted from payments made to independent contractors.
However, withholding tax may be deducted if the independent contractors have not quoted their ABN, or, if the foreign resident withholding provisions apply.
|If you're paying interest, dividends or royalties to people who are not New Zealand residents, you need to deduct NRWT (Non-resident withholding tax) from the gross amount paid.
This amount is non-resident passive income (NRPI). If you pay NRPI, you'll need to register as an NRWT payer.
Find out more about NRWT (Non-resident withholding tax)
|Foreign resident withholding (FRW) is part of the pay as you go (PAYG) withholding system.
FRW requires payers to withhold tax on payments made to foreign residents for particular types of activities.
These activities are:
The rate of withholding is set at a default rate. This rate can be varied to match the expected tax payable in particular cases by applying to the ATO.
The FRW does not affect existing PAYG and non-resident withholding obligations on payments:
An annual tax return should be lodged by the foreign resident and the FRW amounts withheld are a credit against the tax assessed.
|Most benefits given to employees other than their salary or wages are fringe benefits. There are four main groups of taxable fringe benefits:
Find out more about fringe benefit tax
|FBT is a tax paid on certain benefits employers provide to their employees or to their employees' associates.
FBT is separate from income tax and is based on the taxable value of the various fringe benefits provided.
The term "benefit" is broadly defined and includes any rights, privileges or services. You provide a fringe benefit when you:
|Any contribution an employer makes to a superannuation fund for the benefit of an employee is liable for tax.
Find out more about employer superannuation contribution tax (ESCT)
Find out more about KiwiSaver
|The superannuation guarantee is a Commonwealth Government program that requires employers to provide superannuation support for their employees. If you are not a resident of Australia but employ workers on a full-time, part-time or casual basis, contractors wholly or principally for labour or company directors, you are still required to provide your workers with superannuation support for work performed in Australia.
The superannuation you provide must be paid to a complying Australian superannuation provider.
You should provide each eligible employee with minimum superannuation contributions of 9.5% (the charge percentage) of their earnings base.
Contributions you make for your employees to a complying Australian superannuation fund are generally tax deductible up to certain limits.
|Some employees may need to make repayments to us for a student loan.
They will use a specific tax code and the employer is required to make these deductions from the employee’s salary/wage.
Find out more about student loan deductions
|Payers with an accumulated higher education loan programme (HELP) debt must have additional amounts withheld from their payments under the PAYG withholding system once their payments are above the minimum repayment threshold for an income year.|
|Some employees may need to make repayments to us for child support. When this occurs we will often request the employer to deduct this from an employee's wages and pass these deductions to us.
Find out more about child support deductions
|Sometimes employers are required to deduct money from employees' salary/wages under the Child Support Scheme. You don't need to do anything unless you are asked to by the Child Support Agency. If this happens you will receive an employer package about what to do.|
|Becoming an employer||Definitions|