Tax Facts – PAYE on Salaries and Wages
Pay As You Earn (PAYE) is the basic tax taken out of your employees’ salary or wages. The amount of PAYE you deduct depends on each employee’s tax code.
PAYE employees must complete a Tax code declaration (IR 330) as soon as they start working for you. If an employee fails to complete the tax code declaration, you must deduct PAYE at the no-declaration rate.
Since payday filing was introduced, employers must:
- File employment information within 2 working days after every payday
- Provide new and departing employees’ address information, as well as their date of birth – if they have provided it to you.
- File PAYE electronically (from payday compatible software or through myIR) if your annual PAYE/ESCT is $50,000 or more.
Note: If you are a ‘small employer’ with gross annual PAYE deductions of up to $500,000, the due date for actual payment of PAYE is the 20th of the month. If you are a ‘large employer’ with gross annual PAYE deductions over $500,000, you will file PAYE twice-monthly, on the 5th and 20th of the month.
For more information regarding PAYE or to register as an Employer either call us or visit the IRD website.
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