News | Features
18 Jun 2021 23:00
NZCity News
NZCity CalculatorReturn to NZCity

  • Start Page
  • Personalise
  • Sport
  • Weather
  • Finance
  • Shopping
  • Jobs
  • Horoscopes
  • Lotto Results
  • Photo Gallery
  • Site Gallery
  • TVNow
  • Dating
  • SearchNZ
  • NZSearch
  • RugbyLeague
  • Make Home
  • About NZCity
  • Contact NZCity
  • Your Privacy
  • Advertising
  • Login
  • Join for Free

  •   Home > News > Business > Features

    Time To Top Up Kiwisaver And Make The Most Of The Scheme

    Mid-June is top up time for many people in KiwiSaver. If you don’t take action in the next week or two, you could miss out on up to a thousand dollars or so from the government.

    First, some background. The KiwiSaver year runs from July 1 to June 30. Every year, soon after June 30, each provider sends to Inland Revenue a list of how much each KiwiSaver member contributed during the year.

    The government then matches that amount, up to $1043, in extra money credited to that person’s KiwiSaver account, probably in August to October. This is misleadingly called a tax credit, even though it has nothing to do with tax.

    There are two exceptions to the $1043 – strictly speaking $1042.86 - maximum. If you are under 18, you don’t get any tax credit. And pretty much everyone else will get less in their first year in KiwiSaver. Their maximum is proportionate to how much of the July-June year they have been in the scheme – dating from the first day of the month in which they joined.

    For example, if you joined in December, your maximum first year tax credit will be seven-twelfths of $1043, or about $608. For more on how to calculate this, see “Incentives” on the “KiwiSaver Basics” page of

    Once you’ve worked out what your maximum is – an approximate amount will do – think about whether you have contributed at least that much since July 1 last year. If you are an employee, include all deductions made from your pay during June.

    If you haven’t yet contributed your maximum tax credit amount, I strongly suggest you do so by June 30.

    The matching of your contributions, up to $1043, is one of the main attractions of the scheme. If twice as much money goes into your account, you’ll get twice as much out at the other end. A $100,000 nest egg will be $200,000, and so on.

    Everyone also receives the $1000 kick-start, boosting their savings more. And employees get a further boost from employer contributions.

    How do you make extra contributions? If you are an employee, you’ll be used to having the money taken out of your pay. But you can’t put in additional money that way. For employees and non-employees alike, there are two ways to pay extra:

    • Deposit the money directly with your provider. Almost all providers will accept one-off payments. Email or ring to find out how to do it, and allow a few days for processing.

    • Send it via Inland Revenue, in the same way as if you were paying tax. Make a deposit at a Westpac bank, or mail in a cheque with your IRD number on the back and a letter saying the money is for your KiwiSaver account, or use internet banking.

    On the internet, use the ‘pay tax’ option, put ‘KSS’ for the tax type, and zero for the period. You can make payments this way as late as June 30 and they will still be counted in this KiwiSaver year.

    If you turned 18 during the July-June year, you are eligible for the tax credit for the portion of the year that you are 18.

    To get the maximum amount, multiply $1043 by “days”/365. “Days” refers to the number of days between your birthday and 30 June. If your birthday was on June 1, your maximum tax credit would be $1043 times 30/365, which comes to about $86.
    You shouldn’t have to tell anyone you have turned 18. Your provider should take care of that.

    © 2021 Mary Holm, NZCity

     Other Features News
     10 Sep: Spring clean your finances
     13 Aug: Plan ahead to give yourself a debt-free Christmas!
     10 Jul: Wise up to clear credit card debt
     07 May: Ways to prepare for the unexpected
     30 Mar: Time for a financial progress check
     10 Feb: Studying up on NZ Super
     10 Jan: Managing the back-to-school bills
     Top Stories

    Disappointment from Taranaki head coach Neil Barnes, that loose forward Lachlan Boshier has been let go by New Zealand Rugby More...

    The Auckland Tuatara will miss a second straight Australian Baseball League season, citing ongoing uncertainty around Covid-19 More...

     Today's News

    Rugby League:
    Adam Pompey has bounced Rocco Berry out of the Warriors side to play the Knights tomorrow 21:56

    Kanye West "likes spending time" with Irina Shayk and is happy to enjoy things as they progress 21:41

    Law and Order:
    Police say they'll be reviewing their footage from a major gang member's funeral...and following up any infringements 21:16

    Dwayne Johnson has topped PEOPLE magazine's list of 100 Reasons to Love America 21:11

    Taliban taking back territory as Australian and US forces prepare to leave Afghanistan by September 21:06

    Cheryl eats a meat-free diet three or four days a week 20:41

    Kelsey Grammer has teased "some things will be different" with the 'Frasier' reboot 20:11

    Sharna Burgess definitely wants to have children 19:41

    Victoria's Secret signs Megan Rapinoe and Priyanka Chopra Jonas in brand makeover bid 19:36

    Reese Witherspoon had panic attacks "for weeks" before filming 'Wild' 19:11

     News Search

    Power Search

    © 2021 New Zealand City Ltd