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An employee who is automatically enrolled has between 2-8 weeks (on or after day 14 and on or before day 56) of starting new employment to decide if they want to stay with KiwiSaver or opt out.
Employees need to opt out each time they start new employment.
You still need to complete a KiwiSaver employee details (KS1) form and send it to us even if an employee wants to opt out.
How an employee can opt out
They can either give you a KiwiSaver opt-out request (KS10), complete the online opt-out request or send it to us.
If they give you the KS10 you must:
- make sure they are within the 2-8 week opt-out period
- stop making:
- KiwiSaver deductions, and
- compulsory employer contributions and ESCT from their next pay.
If your employee completes the online opt-out request we'll:
- advise you the employee has opted out, and
- ask you to stop:
- compulsory employer contributions
You need to send us the KS10 (or a copy of it) no later than the next employer return you file. You can file your KS10:
- in ir-File if you file an Employer monthly schedule (IR348),
- by posting it with your next Employer schedule (IR348), or
- under the Payroll returns tab in the My business section of myIR, if you're a payday filer. Here you'll be able to file multiple forms at one time.
The KS10 takes effect from the date it's received by you or accepted by us.
Employees under the age of 18 who have been incorrectly enrolled can also use the KS10. They'll need to send this directly to us.
After the eight week opt-out period, the employee must send the KS10 directly to us. We can accept late opt-outs at our discretion if one or more of the following applies.
- You didn't supply the employee with an information pack within seven days of starting their new employment.
- We didn't send a product disclosure statement for the default KiwiSaver scheme the employee was allocated to.
- You didn't supply a product disclosure statement for your chosen KiwiSaver scheme, if you have a preferred scheme provider in place.
- Events outside of the employee's control meant the opt-out notice couldn't be given within the time limit for opting out.
We may accept a late opt-out notice up to three months after the date of receiving an employee's first contribution. If we don't accept a late opt-out notice we'll treat it as an application for a contributions holiday. We'll only do this if the person is eligible for one.
This will usually apply to existing members starting new employment who think they can opt out. A contributions holiday should be granted for five years if an opt out isn't accepted, but we won't notify you.
Refunds when an employee opts out
If you've already sent the deductions to us with your PAYE payments we'll refund the employee.
If you haven't paid their deductions to us, you can refund these to the employee.
If you don't refund the deductions or pay them to us you may be liable for penalties.
We'll refund you any compulsory employer contributions you've made.
Any ESCT calculated on employer contributions will be refunded to you on request. You can do this by:
- completing an Employer schedule amendments (IR344) form, or
- contact us