Your tax code affects the amount of tax that you are liable for under PAYE.
Your tax code will depend on:
- How many sources of income you have
- The amount you are earning
- Whether you have a student loan
- Whether you are a New Zealand tax resident and
- Whether you receive an income-tested Work and Income benefit.
What are the tax codes?
|
M |
Earnings are the main source of income |
|
ME |
Earnings are the main source of income and entitled to independent earners tax credit (IETC) |
|
ML |
Earnings are the main source of income where annual taxable income is less than $9,880 |
|
M SL |
Earnings are the main source of income with student loan |
|
SB |
Earnings are a secondary source of income and annual taxable income is less than $14,000 |
|
S |
Earnings are a secondary source of income and annual taxable income is less than $48,000 |
|
S H |
Earnings are a secondary source of income and annual taxable income is between $48,000 and $70,000 |
|
S T |
Earnings are a secondary source of income and annual taxable income is more than $70,000 |
|
WT |
Taxing scheduler payments |
|
CAE |
Earnings of casual agricultural employees |
|
EDW |
Earnings of election day workers |
|
NWS |
Earnings of non-resident seasonal workers |
|
STC |
Earnings of special tax code |
Incorrect tax code?
If you are on the wrong tax code you may be paying too little or less. According to s 24G of the Tax Administration Act 1994, when the Commissioner finds that you have been using the incorrect tax code, they will notify your employer about your incorrect code and supply the correct code to them. It is the responsibility of the employer to change to the correct tax code in the payroll system.
However, if your situation has changed, you should inform your employer and a different tax code should apply. You can also inform IRD and they can change it for you or do it yourself by filling out the R330 Tax code declaration form.
Reference
Tax Administration Act 1994
{proforms 1}