What is payday filing?
Payday filing is an online option for submitting your employment information to the IRD after every payday. You’ll need to submit an employment information schedule after every payday, instead of an IR348 (Employer monthly schedule).
Do you have to use payday filing?
Payday filing is optional from 1 April 2018 to 31 March 2019 however it’s compulsory from 1 April 2019. Therefore Employers and payroll intermediaries must payday file from 1 April 2019.
You must also file online if you make PAYE/ESCT deductions of $50,000 a year or more. If your total PAYE/ESCT is less than $50,000 for the previous year ended 31 March you can either file paper returns or file online.
How does it work?
IRD has been doing a lot of work behind the scenes as part of its making tax simpler initiative. It has replaced its old system with a new and now has in place software which can connect to online accounting and payroll systems. This means that PAYE filing, always a manual task up until now, can finally be automated.
Payday filing is an online option for submitting your employment information to the IRD directly from your accounting software. However you can also file upload in myIR or manually fill the on screen form (not recommended as errors are likely).
You’ll need to submit an employment information schedule after every payday, instead of an IR348
IR345 form and payment. The due dates for paying and submitting the IR345 stay the same. If you submit employment information directly from your payroll software, you still need to file an IR345 form.
Switching to Payday filing
Business will eventually have to switch to payday filing. The IRD has allowed a year for business to switch and make sure their systems are working perfectly and producing the correct schedules. Our advice is not to wait till 1 April 2019 when it becomes compulsory to use payday filing, rather start now for a smooth transition. Contact us if you have any questions around payday filing and how start using it.