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The Employer Superannuation Contribution Tax (ESCT) rate can be set manually or calculated using the employee’s marginal tax rate. 

Ace Payroll calculates the ESCT rate for you automatically by estimating the employee’s annual earnings. Letting Ace Payroll calculate the ESCT rate means that if your employee’s annual earnings change, the rate is automatically adjusted.

You can override this setting and select a different rate manually by following the instructions below.

If you set your own rate, note that the annual earnings estimate for your employee must include employer KiwiSaver contributions.

Rate band estimation

Employed full year 

If the employee was employed for the full previous financial year, Ace Payroll uses the figures from that full year.

To do this Ace Payroll calculates the total salary and wages paid in that previous year, including employer KiwiSaver contributions before ESCT deductions, and estimates the tax rate for the current year based on that total.

If your employee's wage or salary has gone up significantly and they have changed rate bands, you can set bands manually following the instructions below.

Newer employees 

When a new employee is added, their ESCT rate is set to 10.5% and to not use dynamic calculation. You can change the ESCT for the new employee rate using the Add More Details button, but whatever rate you choose will be used for the remainder of the current financial year.

The ESCT rate should be reviewed at the start of the next financial year. If you need to change the rate, you can do this from the Modify Employee Details screen.

Once an employee has been employed for more than twelve months, they can be changed to dynamic ESCT calculation, using the instructions below.

 

To set a rate for ESCT manually
  1. From the front screen click Employee > Modify Employee Details > KiwiSaver.

  2. Click the Employer Contribution Tax rate.



  3. Select the desired rate.



  4. Click Go.


To calculate ESCT dynamically
  1. From the front screen click Employee > Modify Employee Details > KiwiSaver.

  2. Click the Employer Contribution Tax rate.



  3. Click dynamically, then click Go.