KiwiSaver is a retirement savings scheme that allows payees to have money deducted from their earnings and paid into a retirement savings fund. If a payee has KiwiSaver deductions taken from their earnings, their employer must also make compulsory employer contributions on their behalf.
The KiwiSaver details on a Payee record capture information that is required to be reported to the IRD about the payee’s KiwiSaver eligibility and current enrolment status. This information is reported via Employment Information submissions that are sent to the IRD through Payday Filing.
If a payee requires KiwiSaver contributions to be deducted from their earnings, a deduction type of Payee KiwiSaver must be added to the Payee record to facilitate the deducting of the KiwiSaver contribution amounts from the payee’s earnings. For more information, see Adding & Updating Deductions.
Before attempting to configure a payee’s KiwiSaver details, it is important to be familiar with the following concepts:
KiwiSaver eligibility/status
employer contributions
opting in
opting out
savings suspensions (formerly known as KiwiSaver holidays).
KiwiSaver Eligibility/Status
The KiwiSaver status/eligibility determines if the payee is eligible for KiwiSaver and if so, whether they are eligible to be automatically enrolled, optionally enrolled or if they are already a KiwiSaver member. The table below lists and describes the valid KiwiSaver statuses/eligibility options:
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. |
Active Member | Indicates that the payee is already an active KiwiSaver member and therefore does not need to be automatically enrolled or opted in. |
Opting-in | Indicates that the payee:
|
Casual/Temp Employee | Indicates that the payee:
|
Eligible for Auto Enrolment | Indicates that the payee:
|
For more information about KiwiSaver statuses and eligibility criteria for KiwiSaver, please refer to the KiwiSaver Employer Guide (KS4).
Employer Contributions
Employers must make contributions to a payee’s KiwiSaver scheme if the payee has payee KiwiSaver deductions taken from their earnings.
The current minimum that an employer must contribute on top of a payee’s contributions is 3% of total taxable pay. However, you can choose to contribute a greater percentage.
When configuring a payee’s KiwiSaver details in FastTrack360, you must select the applicable rate at which employer contributions are to be calculated for the payee if the payee's KiwiSaver status is any of the following:
Active Member
Opting-in
Eligible for Auto Enrolment.
If employer contributions must be made on behalf of the payee, you can also choose to continue employer contributions while the payee is on a savings suspension but it is not mandatory to do so. If this is the case, you must set the Continue Employer Contribution flag on the KiwiSaver details to enable the system to continue calculating employer contributions while no payee KiwiSaver contributions are being deducted.
Opt-in Dates
Payees who are eligible to join KiwiSaver on an optional basis can choose to opt into the scheme. Where this is the case an opt-in date must be recorded in the KiwiSaver details to identify when the payee has chosen to opt into the scheme.
A payee can only opt-in if 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 and is not eligible for automatic enrolment on commencing employment.
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.
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. That is, a payee can only opt out if their KiwiSaver status is Active Member or Eligble for Auto Enrolment.
Once opted out, the payee cannot choose to opt in again.
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 who is eligible to opt out of KiwiSaver must opt out 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.
If a payee is opting out late (i.e. after 56 days of commencing employment) the reason for the late opt-out must be reported to the IRD via Payday Filing and therefore, where applicable, the late opt out reason must be captured on the KiwiSaver details. The valid reasons that can apply are:
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 textual description of the reason why the payee is opting out late must be captured on the KiwiSaver details.
Saving Suspensions (formerly KiwiSaver Holidays)
A payee who is an active KiwiSaver member can choose to temporarily stop making contributions to KiwiSaver after 12 months. The suspension in contributions can be for a minimum of 3 months or a maximum of 12 months.
If a payee is eligible for a savings suspension, they will provide you with a savings suspension notice. If a payee gives you a valid savings suspension notice, you must do the following in FastTrack360:
add a savings suspension start date to the payee’s KiwiSaver details to ensure that the savings suspension is reported to the IRD
add a deduction end date on the payee’s Payee KiwiSaver deduction to ensure that KiwiSaver deductions cease to be deducted from the payee’s earnings from the appropriate date.
When a payee’s saving suspension ceases, the IRD will send you communications to ask you to restart deducting payee KiwiSaver from the payee’s earnings. When that occurs, you must do the following in FastTrack360:
add an end date against the savings suspension that you added when the savings suspension began
add a new Payee KiwiSaver deduction with a validity start date that falls into the first pay period from which KiwiSaver payee deductions are to recommence.
How to Add New KiwiSaver Details
To add new KiwiSaver details, follow the procedure below.
How to Add KiwiSaver Details | |
On the Payee Entry screen, navigate to the KiwiSaver Details section and click Add at the top of the section. The Add/Edit KiwiSaver Details dialog box opens. | |
2. | In the KiwiSaver Status field, select the option that applies to the payee regarding their eligibility and current KiwiSaver status. The options are: 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). If the payee's status is Casual/Temp Employee or Ineligible, skip steps 3-5 of this procedure. |
3. | In the Employer Contribution Rate field, select the relevant rate at which employer KiwiSaver contributions will be paid. |
4. | Click Continue Employer Contribution if the employer KiwiSaver contributions are to continue to accrue if the payee takes a savings suspension. Skip this step if employer contributions are to cease while the payee is on a KiwiSaver holiday. |
5. | If the payee is choosing to opt into KiwiSaver, select a date in the Opt-in Date field. A payee only needs to be opted into KiwiSaver if they are not already an active member and are not eligible for automatic enrolment. The KiwiSaver Status of the payee must be set to Opting In to allow an opt-in date to be selected. Note that if a payee’s KiwiSaver status is Eligible for Auto Enrolment or Active KiwiSaver Member the payee does not need to have an opt-in date; an opt-in date is only required if the payee is eligible for optional KiwiSaver membership and is choosing to opt in. If a payee has already been paid, their opt-in date must be later than the Last Used Date of their Payee record. Skip this step if the payee's KiwiSaver status is anything but Opting-In. |
6. | At the top of the Payee Entry screen, click Save. A confirmation message is displayed at the top of the screen to indicate that your changes were saved. |
How to Add a KiwiSaver Opt-Out Date
If the payee has been automatically enrolled into KiwiSaver or was already an active member at commencement of employment they can choose to opt-out of KiwiSaver.
A payee can only be opted out if their KiwiSaver status is Eligible for Auto Enrolment or Active KiwiSaver Member.
How to Add a KiwiSaver Opt-Out Date | |
On the Payee Entry screen, navigate to the KiwiSaver Details section. | |
2. | In the Opt-Out Date field, select the date on which the payee has opted out of KiwiSaver. 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. If the opt-out date is more than 56 days after the payee's employment start date, the Late Opt-our Reason field is enabled, in which case continue to step 3. Otherwise, skip to step 5. |
3. | In the Late Opt-Out Reason field, select the reason that best describes why the payee is opting out more than 56 days after commencing employment. Alternatively, select the Other option if none of the reasons apply. If you selected the Other option, continue on to step 4. Otherwise, skip to step 5. |
4. | In the Late Opt-Out Other Reason field, key in a textual description of why the payee is opting out more than 56 days after commencing employment. |
5. | At the top of the Payee Entry screen, click Save. A confirmation message is displayed at the top of the screen to indicate that your changes were saved. |
How to Add a Savings Suspension
A payee can only go on a savings suspension if their KiwiSaver status is Eligible for Auto Enrolment or Active KiwiSaver Member.
If the payee goes on a savings suspension, employee contributions do not cease automatically; it is necessary to end date the corresponding KiwiSaver payee deduction to cease the deduction of the employee contributions as at the suspension start date.
KiwiSaver employer contributions will cease automatically while the payee is on a savings suspension. That is, where the savings suspension applies on the end date of pay batch, no employer contributions will be calculated in that pay batch. The exception is if the Continue Employer Contribution field is ticked, in which case the employer contributions will continue to be calculated even while the payee is on a savings suspension.
To add a savings suspension, follow the procedure below.
How to Add a KiwiSaver Savings Suspension | |
On the Payee Entry screen, navigate to the KiwiSaver Details section. | |
2. | At the top of the Suspension Details table, click Add +. A new row is added to the Suspension Details table. |
3. | In the (Start Date) From field, select the date on which the savings suspension starts. |
4. | At the top of the Payee Entry screen, click Save. A confirmation message is displayed at the top of the screen to indicate that your changes were saved. |
When you receive notification of the end date of the savings suspension, the date on which the savings suspension concludes can be be selected in the (End Date) To field.