Rolling out employment tax changes in payroll

27th March, 2017

April 1 is looming as a key tax deadline for small businesses – are you ready for the changes in employment law?

Last year the government introduced several key changes in employment law, some of which came into effect immediately. However, other measures are scheduled to come into effect from 1 April this year, and you need to be ready.

Changes to parental leave, the minimum wage, wage deductions and record keeping penalties came into effect immediately for all employees, zero-hour contracts, shift cancellations and secondary employment applied to new recruits from 1 April 2016.

For existing employees employed on or before 31 March 2016, however, businesses have until 1 April 2017 to make any required changes to employment agreements.

Business owners should review their HR processes, policies, Employment Agreements and outdated contracts to make sure they comply with the new laws and ensure these inputs are accurately reflected in their payroll system.

Existing employees (employed on or before 31 March 2016)

Ensure changes are made to employment agreements if any of the following are relevant:

  • Zero-hour contracts
  • Shift cancellation
  • Secondary employment

What’s changing for 2017-2018 financial year?

Each year, the government passes on taxation changes that come into effect at the beginning of the new financial year – 1 April.

If you’re using an online payroll solution like our Essentials Payroll, you don’t need to worry as we update the software automatically.

For those running a desktop payroll solution you need to make sure that your software is updated so that you have the correct tax calculations and remain compliant.

Changes coming into effect on 1 April 2017:

  • The annual ACC threshold increases from $122,063 to $124,053
  • The maximum ACC levy increases from $1,696.67 to $1,724.33
  • The annual student loan repayment threshold for 2017–2018 is $19,048
  • Rules around schedular payments deductions, for which the WT tax code is usually used, are changing