Newsletter – March 2012


Autumn 2012

Welcome to our Autumn Newsletter.  In this issue, we will cover the changes that will affect all employers and employees from 1 April 2012.  Please feel free to contact any of our team for more details.

Summary of Key Changes

Kiwisaver Changes – Members Tax Credit and Employers Contributions

New Adult Minimum Wage Increases to $13.50 an hour

ACC Earner Levy Changes

Student Loan Scheme – changes to codes and additional tax codes


Member Tax Credit

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.


Employers Superannuation Contribution Tax

ESCT (employer superannuation contribution tax) is a tax paid on employer cash Kiwisaver contributions.

Removal of the 2% ESCT exemption

Currently the first 2% of an employer’s contribution to their employee’s KiwiSaver or complying fund is exempt from ESCT so long as it was no more than 2% of the employee’s gross salary or wage.

From 1 April 2012 the 2% ESCT exemption will be removed.  This means that from 1 April 2012 the entire employer contribution will be liable for ESCT.

The rate will be equal to an employee’s marginal tax rate, which means employees will receive less employer contributions into their Kiwisaver fund than in the past.

Employers will not have to pay more than currently, but some will go to the IRD.


ESCT Calculation Options

  1. ESCT can be calculated using a progressive table as below:-
Income ESCT Rate
0 – $16,800 10.5%
$16,801 – $57,600 17.5%
$57,601 -$84,000 30%
$84,001 + 33%
  1. Employers can treat their employer contribution as salary or wages with the agreement of the employee.

The ESCT rate threshold is set at the beginning

of the tax year and cannot change until the following year when the rate is re-calculated.

Time will be incurred at the beginning of each tax year calculating the appropriate ESCT rate.

ACC Levy Changes

From 1 April 2012 the earner levy will drop from $2.04 per $100 to $1.70 per $100 (1.7%).

This levy is for the purpose of funding the cost of non-work related injuries.


New minimum wage rates take effect from 1 April 2012.


  Present rate New Rate from 1 April 2012 Daily Rate

8 Hours

Week Rate

40 Hours



$13.00 an hour $13.50 an hour $108 a 8 hour day $540 a 40 hour week $28,080 a year
New Entrants


$10.40 an hour $10.80 an hour $86.40 a 8 hour day $432 a 40 hour week N/A




Student Loan Scheme Changes

All borrowers are required to have a student loan (SL) repayment code regardless of whether their income is under the annual repayment threshold of $19,084.

New Tax Codes

Currently borrowers who use the SB or ML tax code do not have repayment deductions due to being below the annual threshold.  From 1 April 2012, borrowers who wish to continue using the SB or ML tax code rate must use SBSL or MLSL unless they have provided their employer with a repayment deduction exemption certificate.

New Student Loan Repayment Codes

SLBOR – A code for additional deductions from salary and wages that borrowers have chosen to make to repay their loan faster.

SLCIR – This code is used when the IRD decide to recover a significant under-deduction.

IMS Payroll End of Year Procedures

In addition to the standard end of year reports that you save, we would also recommend saving the following reports in PDF format:-

Total Leave Report – Termination Value Selected

Annual Leave Report – Accumulator Option

Company Payroll Summary


ABM Document Scanning Module

Reduce Unproductive time and Safeguard your Documents

ABM Document Scanning Module allows you to add attachments to a customer, supplier, product or a transaction.  Designs, photos, emails etc. can be attached (drag and drop) and viewed without the need to pull out a manual file.  Unproductive time you and your staff spend looking for and through files to locate the information you need can be a thing of the past.  Also a good risk management tool as a manual document can be lost in a disaster or just mislaid.

Call Debbie for more information.








Easter Opening Hours

We will be closed on Friday 5 April and will reopen on Wednesday 11 April.



ABM TIP – Back to Back Orders

Did you know that ABM can automatically create purchase orders when a customer orders an item not in stock?

When the item arrives in, you are then prompted to complete the sale transaction.

Contact Ron or Jill for more information.


Phone 03 211 2589   Fax 03 218 3408

Level 2, 137 Spey Street, Invercargill

If you have any issues you need to discuss please give us a call.


“Strategic Software have provided our company with business management systems for the past 9 years. Their products and services continue to support our company and have been a major contributor to our success in the following ways;
– Strategic Software installed a business management system that accurately assists with scheduling our workflow. This is vital to our business success and client satisfaction.
– We are able to see where jobs are at any time and can review profit on all jobs.
. . . Prospect and conversion rates can be measured and followed up on.
– The system helps us plan and schedule work.
– The system is flexible and Strategic can customize reporting to meet our needs.
– In regards to payroll, we provide the hours and Strategic do the rest.
– Assists with keeping up to date with employment legislation and reducing risk.
– Strategic processing our payroll means that all employees pay details are confidential and records are accurate, avoiding disputes or disgruntled employees.
These processes allow us to concentrate on our own area of expertise in relation to staff and customer management and the very important task of continued improvement in quality production techniques.
Working with Strategic has allowed us to make continued improvements in measuring our key point indicators and time saving in gathering these KPI’s is key.
Strategic deliver a very professional, prompt and friendly service and we have no hesitation in recommending them.”

Neil Lewis, Director
Lewis Windows Limited

Read More Testimonials