Payroll giving for individuals
Payroll giving, where offered by your employer, gives you the opportunity to donate to approved donee organisations direct from your pay and receive immediate tax credits that reduce your PAYE payable. You don't need to wait until the end of the year to claim your tax credit.
Only employers who electronically file their employer monthly schedule and deduction form can choose to offer payroll giving to their employees.
Definition of donee organisation
A donee organisation is an organisation that has Inland Revenue-approved donee status. Anyone on the approved list is eligible to receive payroll giving donations.
Payroll giving and employees
If your employer offers a payroll giving scheme and you want to join, you need to:
- check the donee organisation you wish to donate to is on our approved donee list
- give your employer the:
- name of the donee organisation
- amount of the donation you want to make
- pay period, or periods, you want the donation to be made
- the donee organisation's bank account or postal address.
If your employer’s scheme allows, you can alter the frequency, amount and donee organisations you choose to donate to.
How tax credits for payroll donations work
Tax credits for payroll donations are calculated at 33.33 cents for each dollar donated which is deducted from you PAYE.
Example
| Gross wages |
$762.00
|
| PAYE |
$150.08
|
| Donation |
$ 10.00
|
| Tax credit for payroll donations |
$ 3.33
|
| PAYE after tax credit for payroll donations |
$146.75
|
| Take home pay with tax credit for payroll donations |
$605.25
|
Individual employees will not be issued with receipts as the tax credits for donations made as part of payroll giving will be immediate in the form of reduced PAYE. They will not be eligible to be claimed again through the end of year Tax credit claim form (IR526).
Date published: 06 Oct 2009
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