Employers in legal quandary over KiwiSaver bungle

Employers are asking Inland Revenue to urgently clarify how they can claim KiwiSaver tax credits lawfully due to them, says David Lowe, Employment Services Manager for EMA (Northern).



“A bungle in the law providing for tax credits for employer contributions to KiwiSaver is leaving many employers short changed,” Mr Lowe said.



“The bungle affects all employers who pay their staff on a fortnightly basis or make extra pays.



“Revenue Minister Peter Dunne has said legislation to fix the mistake won’t be in place until much later in the year but employer tax credits start in a few days.



“The lost tax credit as promised in the Budget to these employers averages about $87 per employee each year.



“The quandary is exacerbated because IRD has issued official guidelines on how employers should claim the tax credit before the mistake was identified and questions are now being asked if the guidelines are right.



“Employers need to know what to do on April 1st.”