finPOWER Newsletter 16 Feb 2010
Hi and welcome to our latest finPOWER Newsletter...
New Resident Witholding Tax rates
We have been advised that there are new Resident Withholding Tax rates due to come into effect on 1 April 2010. These changes may require you to make some adjustments in your finPOWER system. Youu may also wish to contact your clients to allow them to elect a new RWT rate in some instances.
In summary the changes are:
| Income band | Current RWT Rate | New RWT Rate | Application Date |
|---|---|---|---|
| 0 - $14,000 | 19.5% | 12.5% | 1 April 2010 |
| $14,001 - $48,000 | 19.5% | 21% | 1 April 2010 |
| $48,001 – $70,000 | 33% | 33% | No Change |
| $70,001 and above | 38% or 39% | 38% | 1 April 2010 |
Other changes that come into effect on 1 April 2010 include:
- A change in the Default RWT rate from 19.5% to 21%
- The Non Declaration rate changes from 39% to 38%
- Company Tax Rate also change to 30% on 1 April 2011, but payers may elect either 30% or 33% from 1 April 2010.
Over the next couple of weeks we will be developing tools to assist you with the changes and these will be provided to your Dealer for implementation. You may also wish to consider contacting any clients that are currently on RWT rates that need to be changed and detailing their options.
For full details of the changes to the RWT rates and a number of other changes to Tax rates that will come into effect on 1 April 2010 please see the IRD's website here.