April has been a month of Changes…

Lots of things have happened this month and now is a good chance to have a look at some of the changes and how they may relate to you and your business.

PAYROLL

MINIMUM WAGE INCREASE – the minimum wage has gone from $14.25 per hour to $14.75 per hour – your April payroll should be reflecting this change in calculations for those of your staff on the minimum wage. If you have employees on the starting out wage who have been there for 6 months or more and/or train or supervise others, plus those on the training wage – they must be moved onto the adult wage.

If you want to work out the effect of this increase on your budget there is an Employee Cost Calculation on the Business website – go to www.business.govt.nz/employeecostcalculator that is easy to use and a useful tool for other payroll changes as well.

ANZAC DAY – as you know - this is now a holiday on the following work day if it falls on a weekend i.e ‘Mondayised’.  For your payroll purposes – if your staff work on the weekend and you close on that day, then they get paid regular holiday pay.  If your business is open on the day then staff should receive at least time and a half and an alternate holiday later on.  (This is going to happen to Waitangi Day next year (2016) as well).

Remember:

• This is the same as Christmas Day, Boxing and New Year’s Day so you have done it before.
• Take into account that some of your staff may want to attend ANZAC (or Waitangi) events.
• Update your leave records – details of the alternate holiday date and holiday pay need to be recorded.
• It will only happen for both Anzac and Waitangi Days about twice every 7 years!

ALLOWANCES

If you pay allowances to your employees you know that some are taxed and some are not. There are some changes that have come into effect this month that apply to these allowances, to do with the definition of ‘accommodation’; meal allowances and clothing allowances.

• Accommodation – tax exemptions may apply to secondments out-of-town for up to two years or capital work projects up to three years in distant locations; Christchurch reconstruction projects; work in multiple locations ongoing and where an employee is required to stay overnight for a meeting, training course or conference.
• Meals – allowances will no longer be taxed for work travel meals up to three months duration; for conferences and training courses or light refreshments when working off the employer’s premises.
• Clothing – tax won’t apply to allowances for uniforms or plain clothes when these are required by the employer.

The best thing to do if you are unsure as to what you should pay is to ask your accountant as these changes are quite specific and can be applied retrospectively.