20 Jun Money for Nothing … Why Wouldn’t You?
If you’ve paid at least $1042 into your KiwiSaver, this KiwiSaver year, the government will contribute up to $521
If you haven’t paid the full amount yet, don’t worry, you’ve got until the 25th of June to top it up and still receive the government contribution.
Who can get the government contribution?
All KiwiSaver members aged 18-65 who have paid money into their KiwiSaver account this financial year are eligible for the government contribution.
If you haven’t been a KiwiSaver member for the whole year, the government may adjust this payment, for instance if you turned 18 or 65 years old partway through the year.
How much would I get?
If you fit the above criteria, for every dollar you put into KiwiSaver, the Government will put in 50 cents, up to a maximum of $521.
How does it work?
To get the full amount you need to have contributed at least $1,042 each year between 1 July and 30 June … that’s only a bit more than $20 a week.
You can contribute through:
- Salary or wage deductions.
- Payments to Inland Revenue.
- Direct payments to your scheme provider.
You don’t need to do anything to claim this contribution, your KiwiSaver provider will do this for you.
How do I know if I’ve contributed enough?
If your KiwiSaver contributions are a percentage from your wage or salary you should be able to just check your payslip which will have your contributions for that year. For example, if you contribute $40 per fortnightly pay in KiwiSaver member contributions than that is $40 x 26 week = $1,040 over a year.
If you are self-employed, or just make voluntary contributions, then you can check myIR and your KiwiSaver provider.
Some things to be aware of:
- The myIR tool doesn’t include any fees or investment growth – just contributions.
- If any of your contributions are from a payroll – whether it’s from your pay as an employee or from your employer – it takes a while for the IRD to process it, so it’s not shown in your myIR KiwiSaver balance for a couple of months.
- Any voluntary contributions paid directly to your KiwiSaver provider (not from payroll) won’t show in the myIR tool unless it is paid online using the bank’s “Pay Tax” function.
Even if you don’t put in the full $1,042, the government will still match 50 cents for every dollar you put in. That means if you contribute $600 in member contributions, you are eligible for $300 from the government to your KiwiSaver.
What if I haven’t contributed enough?
If you haven’t yet made the full $1042 member contributions this KiwiSaver year, there is still time to top it up (before 25 June 2021). You can make a top-up payment to your, or a family member’s, KiwiSaver.
To contribute through your bank account, log into your internet banking and choose ‘Tax Payment’. Then select ‘KiwiSaver member account (KSS)’ as the tax or payment type. You will then need the IRD number to make sure it’s credited to the right account.
And even if you haven’t saved the full amount, you still get 50 cents for every dollar you put in between 1 July 2020 and 30 June 2021.
What if I Don’t Know Who My Provider is?
If you don’t know which company manages your KiwiSaver, contact the Inland Revenue Department on 0800 549 472 or by logging in to myIR.
What if I’ve already paid that much into KiwiSaver?
If you’ve already made it to $1042 … congratulations! You’re already looking after your future. And remember; the more your put in the more you benefit in the future.
What doesn’t count?
Your employer’s KiwiSaver contribution or your Australian Super transfer aren’t included when calculating this benefit.
The future
Now you’ve sorted out your free money for this year, how about setting up a regular payment through your bank account so next year is taken care of.
Remember
Make your payment by internet banking by 25 June 2021 to allow for processing time.
Set up a direct debit straight from your bank account to make sure your free government contribution is taken care of next year.
For all your KiwiSaver questions, please contact me via jude@stratusnz.nz
No Comments