The ACC Earner Levy is a component of the PAYE.

 

The rate per $100 is increased from $1.46 to $1.53. This increases weekly PAYE by 7 cents per $100 gross.

 

This change will automatically come into effect when you enter a pay period end date of 1 April 2023 or later.

 

For main employment income, the repayment threshold is increased from $409 per week to $439 per week.

The result is that an employee on tax code M SL or ME SL can now earn more gross pay per week before they have any student loan repayment deducted from their pay.

 

So for M SL and ME SL, the employee does not pay a standard student loan amount if their weekly earnings are $439 or lower. This is called the weekly threshold.

Weekly threshold is $439

Fortnightly threshold is $878 ($439 * 2)
Four-weekly threshold is $1,756 ($439 * 4)

Monthly threshold is $1,902.33 ($439 * 52 / 12)

 

Example 1:

Employee earns $539 this week, and is on the M SL tax code.

The threshold is $439, so the amount to calculate the repayment on is $539 less $439 = $100

Therefore the Student Loan Repayment amount (from April 2023) is $100 * 12% = $12.

 

Example 2:

Employee earns $400 this week, and is on the M SL tax code.

This is below the threshold of $439, so the employee has no student loan deduction this week.

 

 

HOWEVER the M SL and ME SL employees will have a student loan deduction even if they do earn less than $439 in the week if they have the additional student loan code SLBOR. A summary is below. In addition IRD may request a special deduction rate (SDR) in some cases.

 

 

SLCIR and SLBOR

These were introduced in April 2012.

 

SLCIR is "Commissioner deduction" and is used for required additional student loan repayments.

SLBOR is "Borrower deduction" and is used for voluntary additional student loan repayments.

 

IRD will advise you if additional deductions are to be made using SLCIR.

For SLBOR deductions, the employee will advise their employer if they wish to make additional payments to reduce their loan balance.

 

You can enter the SLCIR and/or SLBOR amounts under "Enter Current Pay", where you will see three new white boxes under the Tax Code:

 

Click on the relevant box to enter the requried figures.

 

The S.D.R. box is for "Special Deduction Rate", which is another Student Loan rate you will use only if advised by the IRD.

 

Special Note on SLCIR Rate

SLCIR has a maximum of 5%. The IRD will advise if you need to use this for an employee.

We have found that the IRD are advising that SLCIR is to be 41.67% of the standard rate. By this they mean 41.67% of 12% which is 5%, so you will enter 5% into Payroll Pro. The reason Payroll Pro requires you to enter 5% and not 41.67% is because that is the requirement of the IRD for computerised payroll systems.