Hopefully anyone who pays staff will know that on the 1st of April Payday Filing became compulsory. On the 30th of September the six-month grace period ended and now IRD are going to start getting serious about compliance.
What is Payday Filing?
Starting on the 1st of April this year, employers must now file their employment information electronically*, within two days of the pay being processed. This replaces the old IR348 forms which used to be filed monthly. Check out this page on the IRD website.
*If you pay less than $50,000 of PAYE/ ESCT annually then you may still carry out this process manually, in this case within 10 days of each pay.
What is the Best Way to File?
A computerised payroll system such as Smart Payroll, MYOB or Xero can do most of this work for you. When you process your pay in whatever application you use, it will generate the Employment Information Report for the IRD. You will need to check whether the report is being submitted to IRD automatically or whether you need to upload the file yourself.
What is the Penalty Process for Non-compliance?
Basically you’re allowed three strikes within a 12-month period. The first failure will earn you an education letter, next will be a warning, and a third failure to comply will result in a $250 fine, due 30 days after the filing due date.
You’ll need to advise IRD if:
- You are not paying wages for a month or more
- You employ staff irregularly during the year
- You are going to stop employing staff for a month or more
If you advise IRD that your are an irregular employer they will accept filing for the months you are employing staff only, but you must let them know in advance
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