What is payday filing?
Currently employers are obliged to report payroll statistics to Inland Revenue once a month or twice a month depending on the size of the payroll. This will change so that the Payroll statistics will be reported to Inland Revenue per payday.
How does this affect me?
If you are an employer it affects you. If your annual PAYE and ESCT deductions are $50,000 or more, you will need to file your information electronically AND within two working days after the payday.
When does this affect me?
The requirement for you to comply with the new rules comes into effect April 1 2019. For all payrolls paid after April 1, 2019 you will be required to file employee statistics on a per pay day basis.
Why has this change been made?
This is part of a bigger initiative from Inland Revenue to simplify tax assessments and returns. It is part of the Making Tax Simpler initiative and the theory is the sooner the Inland Revenue has an employee’s information the easier and more seemless it is to assess their taxable income.
Will my employees notice any changes?
Not really. This change doesn’t affect their pay frequency or when they get paid.
Are there any benefits to me the employer?
Not really. This benefits Inland Revenue and will contribute towards the simplification of assessing taxable income.
As an employer do my PAYE payment dates change?
This change only affects the payroll statistics filing due dates. This change does not affect any payment due dates. Payment due dates remain the same as they are now.
It is always a good idea to review your payroll size and PAYE and ESCT payment amounts to ensure that you haven’t changed into a different filing regime without realising it and without implementing the change.
Will my payroll system be compliant?
You should contact your payroll system provider or your payroll administrator about this. The payroll system you use should be able to provide you with this information.
My software provider says my payroll system won’t be compliant what do I do about that?
If your annual PAYE and ESCT obligation is over $50,000 you must file electronically. So if the current payroll system you use won’t be compliant you will have to move to a new payroll system. One that is compliant. There are many robust electronic payroll systems out there. The main thing is that you must have implemented the change prior to the first payroll after April 1, 2019.
This is a law change. It is compulsory from April 1, 2019. It is your responsibility as an employer to ensure you can easily comply with this law.
If you are unclear about the changes or have any questions, please get in touch.
