Posts by Paul Campbell
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Poking around on the IRD/KS web site I can't see anything different from what I've described above (for current wages ie today)
Ah! here's a list of changes:
"Compulsory employer contributions will rise from 2% to 3% from 1 April 2013"
"All employer contributions to employees' KiwiSaver accounts (and complying superannuation funds) will be subject to employer superannuation contribution tax (ESCT) from 1 April 2012. ESCT will be applied at a rate equivalent to an employee's marginal tax rate."
That last one does mean that the tax free portion of the employer contribution will go away April 1 next year - in essence National have reduced your KS contribution by ~1/6, if you're paying 2%+2% KS and are on the high marginal tax rate, and are keeping the money for themselves
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OnPoint: If Wishes Were Horses..., in reply to Sacha,
didn't that change? I'm not sure, if it has it hasn't kicked in yet (just like the 3% hasn't kicked in yet - I would guess April 1st) - at the moment there's two parts: the employer can claim a tax credit for their contribution and the employee doesn't pay tax on what they receive it may be that the employer tax credit has gone away
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OnPoint: If Wishes Were Horses..., in reply to Gareth Ward,
At the moment (I'm an employer, my company only employs myself) I can only give the mimimum employer contribution (2% going to 3%) tax free to my employees, any more and I have to withhold tax on that income and report it as income to the IRD - this is exactly equivalent to my employee earning exactly that amount more and choosing to put it in kiwisaver - I may as well pay my employee that money and let them choose (ie it's pretty pointless for an employer to put in more).
As I mentioned above not explained by Labour is: will the 7% employer contribution also (or all) be tax free? If so the Farrar's analysis is crap because getting a tax free 7% in your kiwisaver and losing a taxed 7% from my salary is obviously much better for me.
I agree that the Aussie tax deferred system (or a US 401K which is the roughly the same) is a better way to do things for Kiwisaver in general. For those who are unfamiliar with these - in a tax deferred scheme you put money into a retirement account before tax is paid - you (hopefully) make money in the account over time, it's not taxed, and when you retire you take the money out and as you do you finally pay the tax on it - usually at a lower marginal rate because when you're retired you're earning less than you were when you were working and putting the money aside
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the difference at the moment is that the size of the employee portion is determined by the employee (I choose to put 8% in). The employer portion is also tax free
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Currently employer contributions up to the minimum 2% are not taxed (anything past 2% is taxed) - anyone know if the Labour proposal taxes employer contributions?
(if not then it's a net win an Farrar is full of shit comparing a tax free income with a taxed one)
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Sigh that's sad - Oakland (my home for 15 years) is arguably one of the most lefty cities in the US (Ron Dellums was mayor for heavens sake) - sadly relations between the local (and BART) police and anyone not wearing a suit have soured since the BART killing a few years ago
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Hard News: Occupy: Don't call it a protest, in reply to Russell Brown,
Meanwhile, Occupy Wellington is being asked to move for the rugby parade. And they're handling it sensibly:
Unlike in Dunedin where drunken rugby fans twice tried to set fire to tents on Sunday night
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My wife is a US citizen she was originally enrolled for city/school board/water board/county/state/federal elections, as she's spent more time overseas her local residency seems to have come progressively unstuck, she no longer gets to vote on local state issues, just on federal ones (president, senator etc) - I think this does make sense, she's not really connected at that local level any more
I wonder if we should do something similar - been living overseas more than X years, you lose you electoral vote but keep the party one (just a suggestion - still trying to figure out if it's a good idea)
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I didn't vote for the 20 years I was away because I assumed that that "not been in New Zealand within the last 3 years" meant "had resided in NZ for 3 years" - which I think is fair - it's sort of the opposite of "no taxation without representation"
To be fair under FPP, having lived in the most strongly-voting-National electorate in the country there had been little point in me ever casting a vote - (I could however have continued to cast a vote to make the bastard's pubs dry though - this was in essence an early vote vaguely in favour of MMP, or at least something fairer)
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Well ours is (or rather was) based on that form you fill in when you file your change of address with the Post Office - the PO used to do all the enrollment back in the day before it was semi-privatised
Somewhere there's a list, maybe driven from school records - both my kids (NZ citizens but born overseas so it isn't driven from birth records) received nice letters congratulating them on their upcoming 18th birthdays and inviting them to register to vote