KiwiSaver and superannuation for individuals
In Budget 2011 Government announced reductions to its tax credit contribution to KiwiSaver.
KiwiSaver changes in the 2012 income year
- The member tax credit (MTC) is to be halved for the next MTC year (ending 30 June 2012). Government will now contribute 50c for each $1 contributed by individual KiwiSaver members, to a maximum of $521.43 a year.
- ESCT (employer superannuation contribution tax) will apply to all employers’ cash contributions to employees' superannuation funds including KiwiSaver accounts (and complying superannuation funds) from 1 April 2012. The rate will be equal to an employee's marginal tax rate, which means employees may receive less employer contributions than they have received from you in the past. If you have any questions about this change, please contact Inland Revenue on 0800 377 772.
- Employees, as your employer contributions to KiwiSaver (and complying superannuation funds) will be subject to ESCT, you may notice a reduction in their contribution to your funds.
Further KiwiSaver changes in 2013
There are proposed changes to employee and employer contribution rates from 1 April 2013:
- The minimum employee contribution rate will rise from 2% to 3% for all members.
- Compulsory employer contributions will rise from 2% to 3%.
Date published: 30 Jan 2012
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