Deductions from salaries and wages: PAYE deductions
Deducting income tax as PAYE
What are PAYE deductions?
PAYE (pay as you earn) is deducted from your employees' salary or wages, and paid to us on their behalf. It includes income tax and ACC earners' levy.
PAYE deduction tables (IR340 and IR341) containing the current deduction rates are available online, go to "Forms and Guides". These show you how much to deduct from each employee's pay based on your employee's tax code.
New PAYE rates come into effect from 1 October 2010. This means you need to start using them to calculate the correct amount of PAYE to deduct from employees' salary and wages for pay periods ending on or after 1 October 2010.
| Note | |
|---|---|
| If we identify your employee is using the wrong tax code, we'll write to you asking you to change it. We'll tell you which employees are using incorrect tax codes and let you know which code they should be on. | |
Use the PAYE / KiwiSaver calculator
You can go to "Work it out" to:
- use the PAYE / KiwiSaver calculator and calculate deductions from an employee's gross wages
- work out how much PAYE you'll have to account for, if you have paid the employee a net amount.
There is a separate holiday pay calculator to work out tax deductions on holiday pay.
Find out more
Correcting employee tax codes
Deducting student loan repayments
Using the tax code declaration
Primary employment tax codes
Secondary employment
Date published: 29 Sep 2010
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