Changes to Payee KiwiSaver Details (Payroll NZ only)

Description

The KiwiSaver Details tab on the Payroll New Zealand > Payee > Payee Maintenance > Payee Entry screen has been enhanced to:

support new KiwiSaver reporting requirements for Version 2 of Payday Filing
enforce the KiwiSaver business rules
simplify the configuration of the KiwiSaver details.

KiwiSaver Details Tab Moved Outside of Payee Validity

The KiwiSaver Details tab has been relocated outside of the payee validity periods and is no longer subject to the payee validity periods. This means that the KiwiSaver details can be edited at any time that the payee is not in an open pay batch and when the payee is being paid in a pay batch, the system refers to what is currently set up in the KiwiSaver details to determine if KiwiSaver employer contributions, and therefore employer superannuation contributions tax (ESCT) is to be calculated at the Wage Costs pay batch stage.

The example below highlights the location of the new KiwiSaver Details tab on the Payee Entry screen.

KiwiSaver Status Field

A new field labelled KiwiSaver Status has been added to the KiwiSaver Details tab.

A payee’s KiwiSaver status must be reported to the IRD via Payday Filing and the introduction of this field allows the system to directly determine the KiwiSaver status that is to be reported instead of the status being derived from the configuration of several fields on the KiwiS aver Status tab, as was the case previously.

This new field also replaces the previous Ineligible field that was used to indicate that the payee was not eligible to be a KiwiSaver member.

The table below explains the options that are available in the new KiwiSaver Status field and how the field will be defaulted for Payee records that have been created prior to upgrading to v11.39.

KiwiSaver Status Option	Description
Ineligible	Indicates that the payee is not eligible to be a KiwiSaver member. This might apply if, for example, the payee is working on a temporary work permit. This status also applies to all payees who have not provided an IRD number. This status is applied by default to any existing Payee record if the Ineligible field was ticked in the KiwiSaver Details for the latest payee validity period prior to upgrading.
Active Member	Indicates that the payee is already an active KiwiSaver member and therefore does not need to be automatically enrolled or opted in. This status should be selected if the payee indicates, at the time of commencing employment, that they are already a KiwiSaver member. Prior to v11.39 it was possible to defined multiple opt-in/opt-out periods. Where that applies, the system will refer to the latest opt-in date to determine if the payee is a KiwiSaver member and is not opted out.
Opting-in	Indicates that the following conditions apply to the payee: is not already an active KiwiSaver member is eligible to join KiwiSaver is not eligible for automatic enrolment is choosing to opt into KiwiSaver. This status is applied by default to any existing Payee record where the KiwiSaver details for the latest validity period have an opt-in date.
Casual/Temp Employee	Indicates that the following conditions apply to the payee: is not already an active KiwiSaver member is a casual or temporary employee who is employed for a maximum of 28 days or works assignments that are a maximum of 28 days in duration. This status indicates that the payee does not contribute to KiwiSaver. However, payees who fall into category can choose to opt into KiwiSaver, in which case the status should be set to Opting-in instead.
Eligible for Auto Enrolment	Indicates that the following conditions apply to the payee: is eligible to join KiwiSaver is not already an active KiwiSaver member will be employed/working assignments for a duration that exceeds 28 days. This status is applied by default to any existing Payee record where the KiwiSaver details for the latest validity period have an opt-in date and an opt-out date.

For more information about KiwiSaver statuses and eligibility criteria for KiwiSaver, please refer to the KiwiSaver Employer Guide (KS4).

Opt-in Dates

A KiwiSaver opt-in date is now only required if the following conditions apply to the payee:

is eligible to be a KiwiSaver member
is not already a KiwiSaver member at commencement of employment
is not eligible for automatic enrolment in KiwiSaver at commencement of employment.

That is, an opt-in date is only required if the payee’s KiwiSaver status is Opting-in. This is because it is only necessary for a payee to opt into KiwiSaver if the payee is optionally choosing to join the scheme and is not already a member (KiwiSaver status of Active Member) and is not eligible for automatic enrolment on commencing employment (KiwiSaver Status of Eligible for Auto Enrolment).

KiwiSaver employer contributions will be automatically calculated in a pay batch if the payee has a KiwiSaver status of Active Member or Eligible for Auto Enrolment without the need for the payee to have an opt-in date and hence an opt-in date cannot be defined if either of those two statuses apply to a payee.

If a payee has already been paid, their opt-in date must be later than the Last Used Date of their Payee record.

In v11.39 onward, if a payee does have an opt-in date then an opt-out date cannot be defined. That is because according to the KiwiSaver rules only those payees who were already members on commencement of employment or who were eligible for automatic enrolment at commencement of employment can choose to opt out. Payees who choose to opt-in after commencing employment, however, cannot choose to opt out. This also means that in v11.39 onward, a payee cannot have multiple sets of opt-in dates.

On upgrading to v11.39, where any existing Payee record had an opt-in date and no opt-out date defined on the KiwiSaver Details for the latest payee validity period, the KiwiSaver Status field will be set to Opting-in and the Opt-in Date field will be set to the opt-in date that was defined prior to the upgrade. If there are multiple sets of opt-in dates prior to upgrading, the latest opt-in date will be used.

Opt-out Dates

Under the KiwiSaver rules, a payee can only opt out of KiwiSaver if they were already a member on commencing employment or if the payee was eligible for automatic enrolment on commencing employment. Once opted out, the payee cannot choose to opt in again. Therefore, in v11.39 onward an opt-out date can only be defined if the payee has a KiwiSaver status of Active Member or Eligible for Auto Enrolment a nd a payee cannot have multiple sets of opt-out dates.

The following are important points about the opt-out date:

it must reflect the date the payee signed their opt-out request, which can only be on or after 14 days of commencing employment
it must not be future dated
it must be later than the Last Used Date of the Payee record, if the payee has already been paid.

Late Opt-out Reason

Under the KiwiSaver rules, a payee must opt out of KiwiSaver within 56 days of commencing employment. However, the IRD may grant the payee permission to opt out after 56 days if certain circumstances prevented the opt out from being reported within the 56-day period.

A new requirement under Version 2 of Payday Filing is that where a payee has opted out late, the reason for the late opt-out must be reported via the Employment Service when their employment information is reported to the IRD. To facilitate this, a new field labelled Late Opt-out Reason has been added to the KiwiSaver details and it is mandatory to select an option in this field if the opt-out date is outside the 56-day period.

The options available in the Late Opt-out Reason field are defined by the IRD and are as follows:

KS info pack not provided within 7 days of employment start date
IR didn’t send investment statement upon allocation to default scheme
Employer didn’t provide investment statement upon allocation to employer-chosen scheme Uncontrollable events prevented opt-out application being submitted within 8-week limit Payee did not meet criteria for KS eligibility
Payee incorrectly enrolled under the age of 18
Other

If the Other option is selected because none of the predefined reasons apply, a secondary field labelled Late Opt-out Other Reason is available and it is mandatory to provide a textual description of the reason why the payee is opting out late.

Savings Suspension (Formerly KiwiSaver Holiday)

Once a KiwiSaver member has been making KiwiSaver contributions for 12 months or more they can choose to temporarily cease making contributions for a minimum of three months or a maximum of one year. This is known as a savings suspension and was previously known as a KiwiSaver holiday.

On upgrading to v11.39, where any existing Payee record had a KiwiSaver holiday defined for the latest payee validity period, the start and end date dates will be automatically copied to the Suspension Start and Suspension End date fields on the new KiwiSaver Details tab respectively.

Pay Company KiwiSaver Default Settings

Prior to v11.39 KiwiSaver settings were available under Payroll NZ > Maintenance> Pay Company > Pay Company Maintenance > Pay Company Entry> Default Settings so that when new payees were onboarded by a pay company they could be opted into KiwiSaver by default and a KiwiSaver employer contribution rate rule could also be defaulted onto the Payee records.

Those settings have been removed in v11.39 because they no longer align with the changes that have been made to the KiwiSaver Details on the Payee record and the rules that apply to KiwiSaver.

Benefits

This enhancement provides compliance with KiwiSaver reporting requirements for Version 2 of Payday Filing and ensures that valid KiwiSaver details can be reported by enforcing the KiwiSaver business rules.

Removing the KiwiSaver Details the payee from under validity periods also allows for ease of configuration because the KiwiSaver Details can be updated at any time that a payee is not included in an open pay batch. This also removes the complexity of savings suspension periods that could span across payee validities.

Configuration

The KiwiSaver Details tab on the Payee record is now located outside of the payee validity periods, as shown in the example below.

The fields that are available on the new KiwiSaver Details tab are listed and described below.

Field

Description

KiwiSaver Status

Identifies if the payee is a KiwiSaver member or is eligible to join the scheme. The options available in this field are as follows:

Eligible for Auto Enrolment – select this option if the payee meets the criteria for being automatically enrolled into KiwiSaver on commencement of employment

Active KiwiSaver Member – select this option if the payee is already KiwiSaver member at commencement of employment

Casual/Temp Employee – select this option if the payee is a casual/temp who works assignments of 28 days or less and is therefore not eligible for auto-enrolment but can choose to opt-in.

Opting In – select this option if the payee is not eligible for automatic enrolment and is not an active KiwiSaver member but is choosing to opt-in

Ineligible – select this option if the payee is ineligible to join KiwiSaver.

For more information about payees’ eligibility for KiwiSaver, please refer to the KiwiSaver Employer Guide (KS4). This field is mandatory.

Employer Contribution Rate

The KiwiSaver rate rule that identifies the rate to be used to calculate KiwiSaver employer contributions.

This field is available and is mandatory if the payee’s KiwiSaver status is Eligible for Auto Enrolment, Active KiwiSaver Member or Opting In.

This field is unavailable if the payee’s KiwiSaver status is Casual/Temp Employee or Ineligible.

Continue Employer Contribution

If ticked, employer KiwiSaver contributions will continue to be calculated if the payee is on a savings suspension (formerly known as a KiwiSaver holiday).

If unticked, calculation of employer contributions will cease when the payee is on a savings suspension.

ESCT

Threshold

Displays the earnings band that applies to the payee for the purposes of determining the applicable employer superannuation contributions tax (ESCT) that must be paid in addition to the employer KiwiSaver contributions for this payee.

This field is display-only and is set automatically by the system the first time that KiwiSaver contributions are calculated for the payee in a pay batch or when the ESCT end of financial year process is triggered to set the ESCT threshold and rate for the upcoming financial year.

ESCT Rate

Displays the rate that is used to calculate employer superannuation contributions tax (ESCT) when employer KiwiSaver contributions are calculated for the payee.

This field is display-only and is set automatically by the system the first time that KiwiSaver contributions are calculated for the payee in a pay batch or when the ESCT end of financial year process is triggered to set the ESCT threshold and rate for the upcoming financial year.

Opt-in Date

If the payee’s KiwiSaver status is Opting-in, this field is mandatory and must be set to the date on which the payee has chosen to opt into KiwiSaver.

This field is unavailable if the payee’s KiwiSaver status is anything other than Opting-in.

Opt-out Date

If the payee has been automatically enrolled into KiwiSaver or was already an active member at commencement of employment but is choosing to opt-out of KiwiSaver, this field captures the date they have signed their opt-out request.

Because a payee cannot opt out of KiwiSaver earlier than 14 days after commencing employment, the date selected in this field must be at least 14 days after the employment start date and must not be a future date. The opt-out date must also be later than the Last Used Date of the Payee record, if the payee has already been paid.

A late opt-out reason must also be provided if the opt-out date is more than 56 days after the employment start date (for more information, see below).

Late Opt-out Reason

If the payee is opting out of KiwiSaver later than 56 days after commencing employment, this field identifies the reason for the late opt-out. This information is required to be reported to the IRD through Payday Filing.

This field is only available if an opt-out date has been specified and that opt-out date is more than 56 days after the payee’s employment start date, in which case this field is mandatory.

If the payee is subject to a late opt-out, select the relevant reason for the late opt out from the options in this field. Alternatively, if none of the listed reasons apply, select the Other option and provide a description of the reason for the late opt-out in the Late Opt-out Other Reason Description field (for more information, see below).

Late Opt-out Other Reason

Description

If the payee is opting out of KiwiSaver later than 56 after commencing employment for a reason other than any of the predefined reasons listed in the Late Opt-out Reason field, this field captures a textual description of why the payee is opting out after 56 days from commencing employment. This information is required to be reported to the IRD through Payday Filing.

This field is only available and is mandatory if the Other option is selected as the late opt-out reason.

Suspension Start Date

If the payee is taking a KiwiSaver savings suspension (formerly KiwiSaver holiday), this field captures the date on which the savings suspension begins.

This field is only available if the payee’s KiwiSaver status is Eligible for Auto Enrolment or Active KiwiSaver Member.

Suspension End Date

If the payee is taking a KiwiSaver savings suspension (formerly KiwiSaver holiday), this field captures the date on which the savings suspension ends.

This field can remain blank if the suspension end date is not known at the time when the payee begins a savings suspension.