Accident Compensation Act 2001

Schedule 4 Deductions on account of earner levies

s 221(2)

1

Subject to this schedule, the PAYE rules of the Income Tax Act 2007 (the PAYE rules) apply, with all necessary modifications, with respect to—

(a)

any amount included in the earnings as an employee of an employer as if such amount were a PAYE income payment (or, as the case may require, salary or wages under section RD 5 of the Income Tax Act 2007) of the employee for the purposes of the PAYE rules; and

(b)

the levy payable by any employee under this Act as if such levy were income tax; and

(c)

the deduction required to be made under section 221 as if such deduction were an amount of tax, which amount is—

(i)

on account of income tax; and

(ii)

made or required to be made for the purposes of the PAYE rules; and

(d)

any employer under this Act as if such employer were an employer for the purposes of the PAYE rules; and

(db)

a PAYE intermediary as defined in section YA 1 of the Income Tax Act 2007; and

(e)

any employee under this Act as if such employee were an employee for the purposes of the PAYE rules;—

and every employer, PAYE intermediary, and employee must comply with the requirements of the PAYE rules, to the extent to which the PAYE rules apply by virtue of this schedule.

Schedule 4 clause 1: amended, on 1 April 2008 (effective for 2008–09 income year and later income years, except when the context requires otherwise), by section ZA 2(1) of the Income Tax Act 2007 (2007 No 97).

Schedule 4 clause 1: amended, on 26 March 2003 (applying to obligations under the principal Act that arise on and after 1 April 2004), by section 169(2) of the Taxation (Maori Organisations, Taxpayer Compliance and Miscellaneous Provisions) Act 2003 (2003 No 5).

Schedule 4 clause 1(a): amended, on 1 April 2008 (effective for 2008–09 income year and later income years, except when the context requires otherwise), by section ZA 2(1) of the Income Tax Act 2007 (2007 No 97).

Schedule 4 clause 1(c): amended, on 6 October 2009 (with effect on 1 April 2008, effective for 2008–09 income year and later), by section ZA 2(1) of the Income Tax Act 2007 (2007 No 97).

Schedule 4 clause 1(db): inserted, on 26 March 2003 (applying to obligations under the principal Act that arise on and after 1 April 2004), by section 169(1) of the Taxation (Maori Organisations, Taxpayer Compliance and Miscellaneous Provisions) Act 2003 (2003 No 5).

Schedule 4 clause 1(db): amended, on 1 April 2008 (effective for 2008–09 income year and later income years, except when the context requires otherwise), by section ZA 2(1) of the Income Tax Act 2007 (2007 No 97).

2

Any deduction made must not be treated as part of or included in any amount of tax withheld under the PAYE rules on account of income tax.

Schedule 4 clause 2: amended, on 1 April 2008 (effective for 2008–09 income year and later income years, except when the context requires otherwise), by section ZA 2(1) of the Income Tax Act 2007 (2007 No 97).

3

If the earnings of any employee include a benefit to which section RD 6 of the Income Tax Act 2007 applies, that section applies for the purposes of determining the amount of the deduction required to be made from the benefit under this schedule by the employer providing the benefit.

Schedule 4 clause 3: amended, on 1 April 2008 (effective for 2008–09 income year and later income years, except when the context requires otherwise), by section ZA 2(1) of the Income Tax Act 2007 (2007 No 97).

4

If an employer or a PAYE intermediary makes a deduction under section 221(1) and fails to deal with the deduction or any part of it in the manner required by this Act, the deduction, to the extent to which the employer or the PAYE intermediary has not made payment of the deduction to the Corporation or an agent of the Corporation, in the application of the assets of the employer or the PAYE intermediary, ranks—

(a)

equally with any amount of tax not paid by the employer or the PAYE intermediary, as provided for in section 167(2) of the Tax Administration Act 1994; or

(b)

if there are no such unpaid amounts of tax, in accordance with section 167(2) of the Tax Administration Act 1994, as if the deduction were an amount of tax withheld and not paid by the employer or the PAYE intermediary.

Schedule 4 clause 4: amended, on 26 March 2003 (applying to obligations under the principal Act that arise on and after 1 April 2004), by section 169(3)(a) of the Taxation (Maori Organisations, Taxpayer Compliance and Miscellaneous Provisions) Act 2003 (2003 No 5).

Schedule 4 clause 4: amended, on 26 March 2003 (applying to obligations under the principal Act that arise on and after 1 April 2004), by section 169(3)(b) of the Taxation (Maori Organisations, Taxpayer Compliance and Miscellaneous Provisions) Act 2003 (2003 No 5).

Schedule 4 clause 4(a): amended, on 1 April 2008 (effective for 2008–09 income year and later income years, except when the context requires otherwise), by section ZA 2(1) of the Income Tax Act 2007 (2007 No 97).

Schedule 4 clause 4(a): amended, on 26 March 2003 (applying to obligations under the principal Act that arise on and after 1 April 2004), by section 169(3)(b) of the Taxation (Maori Organisations, Taxpayer Compliance and Miscellaneous Provisions) Act 2003 (2003 No 5).

Schedule 4 clause 4(b): amended, on 1 April 2008 (effective for 2008–09 income year and later income years, except when the context requires otherwise), by section ZA 2(1) of the Income Tax Act 2007 (2007 No 97).

Schedule 4 clause 4(b): amended, on 26 March 2003 (applying to obligations under the principal Act that arise on and after 1 April 2004), by section 169(3)(b) of the Taxation (Maori Organisations, Taxpayer Compliance and Miscellaneous Provisions) Act 2003 (2003 No 5).

5

In relation to an employee who is a private domestic worker, neither the employer of that employee nor a PAYE intermediary is obliged to make any deduction under section 221(1) from amounts paid or provided by the employer in respect of the employment of that employee as a private domestic worker; and section RD 4 of the Income Tax Act 2007 applies to that employee in respect of such amounts.

Schedule 4 clause 5: amended, on 1 April 2008 (effective for 2008–09 income year and later income years, except when the context requires otherwise), by section ZA 2(1) of the Income Tax Act 2007 (2007 No 97).

Schedule 4 clause 5: amended, on 26 March 2003 (applying to obligations under the principal Act that arise on and after 1 April 2004), by section 169(4) of the Taxation (Maori Organisations, Taxpayer Compliance and Miscellaneous Provisions) Act 2003 (2003 No 5).

6

For the purpose of section 221(1), the employer of a shareholder-employee is deemed to make payment to the shareholder-employee of the earnings as an employee for a tax year on the date that the employer finally determines the amount of the earnings as an employee of the shareholder employee for that tax year.

Schedule 4 clause 6: amended, on 1 April 2005 (effective for 2005–06 tax year and later tax years, except when the context requires otherwise), by section YA 2 of the Income Tax Act 2004 (2004 No 35).

7

An employer who makes a payment to a shareholder-employee must, within the time within which the employer is required to furnish a return of income under section 33 of the Tax Administration Act 1994, deliver a statement of the total amount of shareholder-employee earnings paid or payable by the employer for the tax year to which the return relates.

Schedule 4 clause 7: substituted, on 3 March 2010, by section 47(2) of the Accident Compensation Amendment Act 2010 (2010 No 1).

8

Neither an employer of any person referred to in section LC 3 of the Income Tax Act 2007 nor a PAYE intermediary is obliged to make any deduction under section 221(1) from amounts paid or provided by the employer to that person, unless the employer or the PAYE intermediary withholds an amount of tax on account of income tax under the PAYE rules from any such amount.

Schedule 4 clause 8: amended, on 1 April 2008 (effective for 2008–09 income year and later income years, except when the context requires otherwise), by section ZA 2(1) of the Income Tax Act 2007 (2007 No 97).

Schedule 4 clause 8: amended, on 26 March 2003 (applying to obligations under the principal Act that arise on and after 1 April 2004), by section 169(6)(a) of the Taxation (Maori Organisations, Taxpayer Compliance and Miscellaneous Provisions) Act 2003 (2003 No 5).

Schedule 4 clause 8: amended, on 26 March 2003 (applying to obligations under the principal Act that arise on and after 1 April 2004), by section 169(6)(b) of the Taxation (Maori Organisations, Taxpayer Compliance and Miscellaneous Provisions) Act 2003 (2003 No 5).

Schedule 4 clause 8: amended, on 26 March 2003 (applying to obligations under the principal Act that arise on and after 1 April 2004), by section 169(6)(c) of the Taxation (Maori Organisations, Taxpayer Compliance and Miscellaneous Provisions) Act 2003 (2003 No 5).

9

Despite clause 1, sections LA 3, LA 6, RA 2, RD 10, RD 11, RD 16, RD 18 of the Income Tax Act 2007 and subpart 3D and schedule 5 of the Tax Administration Act 1994, and section 33A of the Tax Administration Act 1994 do not apply to any such amount required to be deducted.

Schedule 4 clause 9: amended, on 1 April 2019, by section 411 of the Taxation (Annual Rates for 2017–18, Employment and Investment Income, and Remedial Matters) Act 2018 (2018 No 5).

Schedule 4 clause 9: amended, on 1 April 2008 (effective for 2008–09 income year and later income years, except when the context requires otherwise), by section ZA 2(1) of the Income Tax Act 2007 (2007 No 97).

10

Except to the extent specified in clause 11, the following Parts of the Tax Administration Act 1994 (those provisions) apply to earner levies payable under section 219, namely,—

(a)

Part 7—interest (but subject to section 157A of the Tax Administration Act 1994); and

(b)

Part 9—insofar as the Part applies to establishing late payment and shortfall penalties (but subject to section 157A of the Tax Administration Act 1994); and

(c)

Part 10—recoveries; and

(d)

Part 11—insofar as the Part provides rights of remission, relief, and refunds in respect of interest, and late payment penalties and shortfall penalties,—

and as if they were set out in full in this Act, but with—

(e)

references in those provisions to tax laws being replaced by references to this Act and regulations or determinations of the Corporation or its agent made under it; and

(f)

references in those provisions to taxpayers being replaced by references to earners; and

(g)

references in those provisions to the Commissioner being replaced by references to the Corporation or an agent of the Corporation; and

(h)

references in those provisions to tax positions being replaced by references to positions a person may take under this Act in relation to liabilities to pay an amount of levy or to deduct or withhold an amount of levy; and

(i)

references in those provisions to tax, tax payable, unpaid tax, and overpaid tax being replaced by references to levies, levies payable, unpaid levies, and overpaid levies; and

(j)

references in those provisions to tax liabilities or obligations to deduct and account for, or pay, amounts of tax being replaced by references to liabilities or obligations to deduct or account for, or pay, amounts of levies or penalties in respect of levies under this Act; and

(k)

references in those provisions to penalties in respect of tax obligations being replaced by references to penalties in respect of obligations under this Act; and

(l)

references in those provisions to assessments made under the Tax Administration Act 1994 being replaced by references to determinations made under this Act; and

(m)

the dates by which levies and penalties are to be paid to the Corporation or its agent under this Act being the due dates for the purposes of those provisions; and

(n)

such other changes as are necessary to give effect to this schedule being deemed to have been effected.

11

Despite clause 10, section 146 of the Tax Administration Act 1994 is not included in those provisions for the purposes of that clause.

12

A deduction is deemed to have been made under this schedule and under section 221(1) if and when payment is made of the net amount of any amount included in the earnings as an employee, and the amount of the deduction is deemed to have been applied for a purpose other than the payment if the amount of the deduction is not duly paid to the Corporation or an agent of the Corporation.

13

In this schedule, deduction includes all or part of a deduction required to be made under section 221(1).

14

No person is chargeable with a penalty under this schedule in respect of any deduction or earner levy payable to the Commissioner as part of a combined tax and earner-related payment.

Schedule 4 clause 14: amended, on 1 April 2008 (effective for 2008–09 income year and later income years, except when the context requires otherwise), by section ZA 2(1) of the Income Tax Act 2007 (2007 No 97).

15

Nothing in clause 14 limits the application of the remission, relief, and refunds component of Part 6.

16

Except as provided in clause 19, every person who has earnings as an employee in a tax year and is subject to the provisions of the Tax Administration Act 1994 as it relates to information provided or required to be provided on the person’s assessable income under Part 3, subpart 3B of that Act or the requirements to furnish a return of income must—

(a)

confirm that their pre-populated account for the tax year is correct and complete; and

(ab)

to the extent to which the amount not included in their pre-populated account for the tax year, provide information to the Commissioner on the amount of their earnings as an employee within the time required under section 22H of that Act; and

(ac)

for a person to whom paragraph (a) or (ab) does not apply, provide a return of income within the applicable time under that Act; and

(b)

pay to the Commissioner, on or before the due date, an earner levy, at the rate prescribed, on any earnings that do not exceed the specified maximum.

Schedule 4 clause 16: amended, on 1 April 2019, by section 365(1)(a) (and see section 365(3) for application) of the Taxation (Annual Rates for 2018–19, Modernising Tax Administration, and Remedial Matters) Act 2019 (2019 No 5).

Schedule 4 clause 16: amended, on 1 April 2005 (effective for 2005–06 tax year and later tax years, except when the context requires otherwise), by section YA 2 of the Income Tax Act 2004 (2004 No 35).

Schedule 4 clause 16(a): replaced, on 1 April 2019, by section 365(1)(b) (and see section 365(3) for application) of the Taxation (Annual Rates for 2018–19, Modernising Tax Administration, and Remedial Matters) Act 2019 (2019 No 5).

Schedule 4 clause 16(ab): inserted, on 1 April 2019, by section 365(1)(b) (and see section 365(3) for application) of the Taxation (Annual Rates for 2018–19, Modernising Tax Administration, and Remedial Matters) Act 2019 (2019 No 5).

Schedule 4 clause 16(ac): inserted, on 1 April 2019, by section 365(1)(b) (and see section 365(3) for application) of the Taxation (Annual Rates for 2018–19, Modernising Tax Administration, and Remedial Matters) Act 2019 (2019 No 5).

Schedule 4 clause 16(b): substituted, on 3 March 2010, by section 47(2) of the Accident Compensation Amendment Act 2010 (2010 No 1).

17

The amount of any levy payable under this Act and clause 16 must have credited towards it the sum of the deductions (excluding any penalty charged or imposed under clause 10 of Schedule 5 of the Accident Insurance Act 1998) made by an employer of the employee or by a PAYE intermediary under section 221 on account of that levy.

Schedule 4 clause 17: amended, on 26 March 2003 (applying to obligations under the principal Act that arise on and after 1 April 2004), by section 169(8) of the Taxation (Maori Organisations, Taxpayer Compliance and Miscellaneous Provisions) Act 2003 (2003 No 5).

18

If the sum of the levy deductions from a person’s earnings as an employee on account of the earner levy payable by the person exceeds the amount of the earner levy payable on the specified maximum of the levy, the Corporation or its agent must refund the excess to the employee.

Schedule 4 clause 18: amended, on 3 March 2010, by section 47(2) of the Accident Compensation Amendment Act 2010 (2010 No 1).

Schedule 4 clause 18: amended, on 26 March 2003 (applying to obligations under the principal Act that arise on and after 1 April 2004), by section 169(9)(a) of the Taxation (Maori Organisations, Taxpayer Compliance and Miscellaneous Provisions) Act 2003 (2003 No 5).

Schedule 4 clause 18: amended, on 26 March 2003 (applying to obligations under the principal Act that arise on and after 1 April 2004), by section 169(9)(b) of the Taxation (Maori Organisations, Taxpayer Compliance and Miscellaneous Provisions) Act 2003 (2003 No 5).

19

If a person with earnings as an employee is a qualifying individual to whom Part 3, subpart 3B of the Tax Administration Act 1994 applies for the corresponding income year,—

(a)

the amount of the earner levy payable under clause 16 is to be treated as equal to the total of the deductions required to be made (if any) from those earnings by the person’s employer or by a PAYE intermediary under section 221; and

(b)

the person need not deliver a statement of earnings as an employee under clause 16.

Schedule 4 clause 19: amended, on 1 April 2019, by section 365(2) (and see section 365(3) for application) of the Taxation (Annual Rates for 2018–19, Modernising Tax Administration, and Remedial Matters) Act 2019 (2019 No 5).

Schedule 4 clause 19(a): amended, on 3 March 2010, by section 47(2) of the Accident Compensation Amendment Act 2010 (2010 No 1).

Schedule 4 clause 19(a): amended, on 26 March 2003 (applying to obligations under the principal Act that arise on and after 1 April 2004), by section 169(10) of the Taxation (Maori Organisations, Taxpayer Compliance and Miscellaneous Provisions) Act 2003 (2003 No 5).

20

If the Corporation is satisfied that the amount of levy payable by a person under clause 19 exceeds the amount that would be payable if the levy amount were determined under clause 16, the Corporation must refund to the person the amount of the excess or, at the Corporation’s option, credit the excess in payment of any earner levy due and unpaid by the person.

Schedule 4 clause 20: amended, on 3 March 2010, by section 47(2) of the Accident Compensation Amendment Act 2010 (2010 No 1).

21

The Corporation may not refund or give credit for any amount under clause 20 more than 4 years after the end of the tax year in respect of which the levy is payable, unless written application for a refund or credit is made to the Corporation by or on behalf of the person concerned before the end of the 4-year period.

Schedule 4 clause 21: amended, on 1 April 2005 (effective for 2005–06 tax year and later tax years, except when the context requires otherwise), by section YA 2 of the Income Tax Act 2004 (2004 No 35).

22

For the purposes of this schedule, combined tax and earner-related payment, Commissioner, employee, employer, income tax, PAYE intermediary, PAYE income payment, salary or wages, and shareholder-employee have the same meanings as in the Income Tax Act 2007.

Schedule 4 clause 22: substituted, on 1 April 2008 (effective for 2008–09 income year and later income years, except when the context requires otherwise), by section ZA 2(1) of the Income Tax Act 2007 (2007 No 97).