Business Accountants: Stay Ahead of Payroll Changes: What to Know for April 1, 2024
Get Ready for April 1, 2024: Important Payroll Changes
As April 1, 2024 approaches, it’s essential for businesses to prepare for several key payroll changes that will come into effect. Here’s what you need to know:
1. Minimum Wage Increase
Effective April 1, 2024, the minimum wage rates will increase as follows:
- Adult: Increasing from $22.70 to $23.15
- Starting Out/Training: Increasing from $18.16 to $18.52 (80% of adult minimum wage)
Take this opportunity to review and update all employees’ pay rates accordingly.
2. Student Loan Threshold Increase
The student loan repayment threshold is increasing from $22,828 to $24,128 per year. This adjustment will affect the first pay run after April 1, 2024.
3. ACC Levy Increase for 2024/2025 Year
The ACC levy rate will increase from 1.53% to 1.60% for earnings less than $142,283. Ensure that your payroll systems are updated to reflect this change, as it will impact net payments to employees.
4. Employer KiwiSaver Contribution – ESCT Tax Rates
Employer KiwiSaver contributions are subject to ESCT tax rates based on employees’ expected annual income. Review and update ESCT rates as necessary to ensure compliance.
5. Processing Wages for March/April 2024
Payroll changes will be applied from the first pay run after April 1, 2024. Ensure that your payroll software is updated accordingly. If using manual PAYE calculators, switch to the 2025 year after April 1.
Reminders: End of Year Tasks
- Review and update all employee pay rates for the new minimum wage.
- Amend any Automatic Payments for wages to reflect changes in ACC and student loan deductions.
- Check and update employee ESCT rates if they are KiwiSaver members.
- Review employee leave profiles to ensure correct leave accruals.
- Consider issuing Annual Earnings Certificates to employees.
Speak to an Expert
For comprehensive guidance on navigating payroll changes, speak to our experienced professionals at Outside Accounting. We have the expertise and tools to assist you in managing your payroll effectively. Contact us today for tailored solutions for your business.
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