Options for employees

If you’re an employee, there are a few straightforward options to consider if you want to make the most of KiwiSaver.

Your contribution options

Unless you choose a different rate of contribution, your employer will deduct the minimum rate of 3% of your before-tax salary or wages. You can choose to contribute at 4% or 8% of your before-tax salary or wages instead of the minimum rate of 3%. 

If you have a total remuneration employment agreement, your employer doesn't have to contribute to KiwiSaver on top of your pay. Under these agreements, your employer's contributions will come out of your total remuneration. If you are unsure whether this applies to you, talk to your employer.

Your employer takes your KiwiSaver contributions from your pay each payday and sends them to Inland Revenue each month. Inland Revenue then send them to us to put into your KiwiSaver account. It’s worth checking your payslip, and your KiwiSaver account, to make sure your employee and employer contributions are being deducted and transferred correctly.

For the first three months after you first join KiwiSaver, Inland Revenue will hold all contributions to your KiwiSaver account in a tax-free holding account and will pay interest on those amounts. After this time, Inland Revenue will transfer all contributions to us.

If you’d like to track your contributions with Inland Revenue during this period, you can visit the Government’s KiwiSaver site and register for ‘My KiwiSaver’.

Watch our video to find out how your KiwiSaver savings are impacted by your choice of contribution rate.

How to change your contribution rate

You can change your contribution rate once every three months, unless your employer agrees to let you change more often, by completing a KiwiSaver deduction form (KS2) and giving it to your employer.

If you change employers, make sure you tell your new employer you are a KiwiSaver member. Your KiwiSaver deductions will go back to the minimum rate unless you tell your new employer that you’re contributing at a different rate. So, if you change jobs, it’s also a good idea to complete a new KS2 form.

How to restart your contributions

If your employee and employer contributions are not being deducted you can restart KiwiSaver deductions from your salary or wages at any time. Simply complete a KiwiSaver deduction form (KS2) and give it to your employer – they’ll take care of the rest.

Making voluntary contributions

At any time, you (or anyone else) can also make voluntary contributions to your account. Find out more.

Make the most of the annual member tax credit

If you earn less than $35,000 a year (before tax) and contribute 3% to a KiwiSaver scheme, the contributions from your pay may not be enough to qualify for the maximum annual member tax credit of $521.43 to your KiwiSaver account per year (from 1 July to 30 June). Find out more.

Need a break from contributing?

Contributions holidays can be for between three months and five years, unless Inland Revenue agrees to a longer period. 

You can apply to Inland Revenue to take a holiday from making contributions: 

  • if 12 months or more have passed since your first KiwiSaver contribution was paid to a KiwiSaver manager or Inland Revenue, or
  • if 12 months or more have passed since you joined a complying superannuation fund, or
  • any time after your first contribution if you are in, or are likely to be in, financial hardship.

You can take an unlimited number of contribution holidays, but this will affect how quickly the savings in your KiwiSaver account grow. Watch our video to find out how taking a break can affect your retirement savings in the long run. 

 

 

Visit the Government’s KiwiSaver site to find out more about KiwiSaver contributions holidays.

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