KiwiSaver
KiwiSaver is New Zealand's voluntary workplace savings scheme designed to help you build a retirement fund. Employees can choose to contribute 3%, 4%, 6%, 8%, or 10% of their gross pay. Employers must contribute a minimum of 3% on top of your salary (subject to ESCT). KiwiSaver funds are managed by approved providers and invested in a range of fund types from conservative to growth.
KiwiSaver savings can generally be accessed at age 65, or earlier for a first home purchase (after 3 years of membership). There is also a government contribution of up to $521.43 per year if you contribute at least $1,042.86. Hardship withdrawals are possible in limited circumstances.
New employees are automatically enrolled in KiwiSaver and can opt out within the first 2–8 weeks. If you're self-employed or not working, you can still join KiwiSaver and make voluntary contributions to receive the government contribution.
Related Terms
ESCT
ESCT (Employer Superannuation Contribution Tax) is a tax that employers pay on their compulsory KiwiSaver contributions before those contributions are deposited into the employee's KiwiSaver account.
PAYE
PAYE (Pay As You Earn) is the system that New Zealand employers use to deduct income tax from employees' wages and salaries.
PIE
A Portfolio Investment Entity (PIE) is a type of managed investment fund that is taxed at the investor's Prescribed Investor Rate (PIR) rather than the standard income tax rates.
PIR
Your Prescribed Investor Rate (PIR) is the tax rate applied to income earned from Portfolio Investment Entities (PIEs), including KiwiSaver funds, PIE term deposits, and managed funds.
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