The Government proposes that where an employer uses a payroll system which connects to Inland Revenue's system, information about new employees could be provided when the relevant employee details were first entered into that payroll system.
That would mean the employer could be provided with confirmation of the employee’s IRD number and tax code, and advised of the employee’s KiwiSaver status and deduction rate, and of any additional deductions (for example for child support) required, before the first time the employee was paid. This would eliminate at source errors which now take time to correct, and remove the need for a separate KiwiSaver form.
The payroll system could also be used to advise Inland Revenue of updates to employees’ details, such as changes to their contact details or ceasing employment. This information would also be passed from Inland Revenue to the employee, so they could correct any errors.
1. Do you agree with the proposal that employers should be able to use their payroll software to provide relevant employee details to Inland Revenue at the time the employee’s details are entered, changed in, or removed from the payroll system?
2. Would using payroll software to provide IR with details of new employees before they are first paid and being notified of deductions as set out above, reduce or increase compliance costs? If you can quantify the effect please do so.
3. Do you support the proposal that Inland Revenue should continue to communicate any change of employee obligations or details to the employee?