People can have a variety of tax codes and special overrides, which provide several options to correctly calculate their tax. For example, see a person's "Personal Details" (Scroll down and press the "Show Advanced Tax Details" button to see additional tax fields).
Usually only the Tax Code, IRD Number and Pay Frequency are entered. Select the appropriate Tax Code and Pay Frequency from the drop down lists and type in the persons IRD Number.
Note: IRD Numbers have a built-in check digit. If you enter an invalid IRD Number you will receive an error message. Either enter the correct IRD Number or change the persons Tax Code to ND (No Declaration).
Special Tax Codes (IR23)
If a person has a Special Tax Code, press the 'More >>' button and enter the appropriate details into the Special Tax %, Special Student Loan % and / or the Special Earner Premium %.
You should not enter any of these Special Tax details unless the person provides a Special Tax Certificate letter from Inland Revenue. That letter will contain the appropriate details.
The person will usually have a Tax Code of "STC" if they have a special tax certificate (the main exception is people are paying SLD - Student Loan Deduction at a special rate).
Special Tax Codes AND Student Loans
If a person has a special tax code for PAYE and a Student Loan, follow these steps:-
- Enter the Tax Code as STC and the Special Tax Rate(s) as advised on the IR23 form.
- Enter a SLD - Student Loan Deduction transaction onto the person's Timesheet Template.
Note: This applies regardless of whether the person has a standard Student Loan deduction, or a special percentage / rate for their Student Loan.
Select the None Tax Code. See PAYE Help.
Select the WT Tax Code and enter a Special Tax %. See PAYE Help.
Select the None tax code. See GST Help.
PAYE Tables are available from Inland Revenue:
Contractors may be on Withholding Tax, be GST Registered, or even have PAYE deducted depending on the circumstances. Refer to the appropriate section on this page for details. IRD has some information on Classifying employees and self-employed.