From tax changes and parental leave, new vaping rules to marketing during the America’s Cup, check out this summary of 2020’s new laws. A lot has changed this year, so make sure you know the new rules that apply to your business.
Parental leave
When: From 1 July 2020
What: Government-funded parental leave payments extended from 22 weeks to 26 weeks.
Unpaid parental leave, during which someone’s job is protected, has also increased. Parental leave depends on how long the person has worked for you before the baby’s due date, or the date they take over the care of a child:
26 weeks parental leave for people who worked an average of 10+ hours a week for six months or more.
52 weeks parental leave for people who worked an average of 10+ hours a week for 12 months or more.
Parental leave, including COVID-19 temporary changes(external link) — Employment NZ
The “keeping in touch” allowance has also gone up. Employees can now work up to 64 hours during their 26 weeks of parental leave payments, without losing eligibility for these government payments.
Keeping in touch days(external link) — Employment NZ
Why: To provide increased support for primary carers, including working parents with new babies and families taking on the permanent care of children under the age of six.
What you need to do: Make sure eligible employees can:
Take at least the legal minimum amount of unpaid parental leave, depending on how long they have worked for you.
Arrange to work up to 64 hours during their 26 weeks of paid parental leave if both you and your employee want to take this option. Remember, you pay them for hours worked, the government covers parental leave payments.
It’s a good idea to check and update your employment processes or policies. Then everyone knows what’s available and how to apply.
Paid parental leave is changing
Privacy and personal information
When: From 1 December 2020
What: Changes to the Privacy Act mean businesses must:
not destroy personal information if someone asks for information held about them
report serious privacy breaches
check personal information disclosed with overseas companies will have similar protection to New Zealand.
The revamped Act gives the Privacy Commissioner greater powers. This includes:
ordering a business to give a person their personal information
issuing a compliance notice if a business fails to comply with the Privacy Act.
Why: The Privacy Act aims to keep personal information safe and secure. The law updates reflect changes in technology and the ways business is done online and offline.
What you need to do: If someone asks for their personal information held by your business, you must respond within 20 working days.
If there’s a serious privacy breach in your business, you must report it to the Office of the Privacy Commissioner.
You can only disclose personal information to an overseas company if its country has similar protections to our Privacy Act. This does not apply to overseas cloud-based services.
Decide who in your business will take the lead on privacy matters. This could be you, an office manager, or another trusted worker. This person will be your privacy officer.
Privacy Act 2020(external link) — Office of the Privacy Commissioner
Privacy Act overhaul to protect personal information in digital age
COVID-19 tax relief
When: Start dates vary, ranging from 25 March 2020 to 12 May 2020.
What: Tax relief measures to help businesses and sole traders financially impacted by the COVID-19 pandemic, including:
Tax loss carry-back scheme. Businesses expecting to make a loss in the 2019/20 or 2020/21 tax years can offset that loss against profits made the year before.
Small business cashflow (loan) scheme for small businesses, sole traders and contractors.
Why: Part of the government’s COVID-19 support package for businesses and sole traders.
What you need to do: This depends on the type(s) of tax relief. Start by checking what’s available to your business and situation:
Extended deadlines to pay tax: Contact Inland Revenue as soon as possible. You must still file your tax return on time.
COVID-19: Manage my tax(external link) — Inland Revenue
Loss carry-back: You must tell IR you plan to use this scheme. Do this online via myIR, using the “I want to” section.
Temporary loss carry-back scheme(external link) — Inland Revenue
Reduced interest charged on unpaid tax (called “use of money” interest) down from 8.35% to 7.00%.
Interest on overpayments and underpayments(external link) — Inland Revenue
Tax, including KiwiSaver and student loans
When: From 1 April 2020
What: Changes include:
Payday filing requirements so Inland Revenue can forward monthly KiwiSaver deductions to each employee’s KiwiSaver provider.
For employees with student loan payments deducted from their pay, Inland Revenue can notify the employer when the loan is almost paid off.
Other law changes include how to value shares given to employees. For more information, check the Inland Revenue website or talk with your tax agent.
Why: To continue simplifying and modernising the tax system.
What you need to do: If you use Inland Revenue’s online payday filing system (ir-File), you likely already do what’s required.
For all employers, it’s a good idea to check the requirements. These include:
filing an employment information form every time you pay your employees
adding the pay day and pay period worked on these forms.
Inland Revenue uses this information for your employees’ KiwiSaver contributions and student loan records.
Payday filing(external link) — Inland Revenue
KiwiSaver for employers(external link) — Inland Revenue
Research and development (R&D) tax credits
When: From 23 March 2020
What: Making R&D tax credits more widely available, starting from the 2019/20 tax year (originally planned to start in the 2020/21 tax year). As well as the new start date, there’s a new refund cap based on your business’s employee-related tax, eg PAYE and ESCT (Employer Superannuation Contributor Tax).
Changes include:
New refund cap based on your business’s employee-related tax, eg PAYE and ESCT (employer superannuation contribution tax).
Research and development changes(external link) — Inland Revenue
Why: To encourage businesses to spend money on research and development activities. Technological and scientific advances help boost New Zealand’s economic performance.
What you need to do: To apply for the R&D tax incentive in the 2019/20 or 2020/21 tax years, register online via myIR. You only need to do this once, not each year.
If you receive the R&D tax incentive, you need to fill out an extra tax return. The R&D supplementary return must be filed within 30 days of the due date for your income tax return.
Register for R&D tax incentive(external link) — Inland Revenue
If your business involves innovation and you don’t already claim R&D tax credits, it’s a good idea to check if you qualify. Tax credits are for businesses, including start-ups, that develop new thinking, products or services related to technology or science.
Research and development(external link) — Inland Revenue
Tenancy rules for landlords, property owners and managers
Healthy homes compliance statements
When: From 1 December 2020
What: A healthy homes standards compliance statement must be included in most new or renewed tenancy agreements.
Why: This statement provides information about a rental property’s current level of compliance with the five healthy homes standards. It helps tenants to see if their landlord is working towards meeting the new standards. Most new or renewed tenancies from 1 July 2021 will need to comply with the standards within 90 days of the start of the tenancy.
What you need to do: For most new or renewed tenancy agreements from 1 December 2020, you will need to include a statement about your property’s current level of compliance with the standards.
For details of what’s required when, and to download a compliance statement template, see the Tenancy Services website:
Healthy homes compliance statement(external link) — Tenancy Services
Healthy homes standards(external link) — Tenancy Services
Limits on rent increases
When: From 12 August 2020
What: Rent increases are limited to once every 12 months. Previously it was once every 180 days (six months).
Why: To provide tenants with greater medium-term certainty of their housing costs and more time to prepare for any increase in rent.
What you need to do: Before you give notice to your tenant to increase rent, you will need to check when you can legally increase it. You can only increase the rent 12 months after the date of the beginning of the tenancy or 12 months after the date the last increase took effect. You must also give at least 60 days’ written notice to the tenant.
Rent increases and deductions(external link) — Tenancy Services
Vaping added to smokefree laws
When: From 11 November 2020
What: Vaping and vaping products (also called e-cigarettes) now have many of the same rules as smoking and tobacco products.
This includes:
No sales or supply of vaping products to people aged under 18.
No vaping in indoor workplaces.
Vaping only allowed in open areas of restaurants, bars, pubs and casinos.
No vaping on planes, buses, trains, ferries, taxis and ride-share services.
No vaping anywhere in or around early childhood centres and schools.
Most advertising and sponsorship banned.
Import restrictions.
Why: To limit the marketing, sales and use of vaping products to:
protect the health of non-smokers, especially young people
ensure vaping remains an option for smokers who want to cut down or switch to lower-risk nicotine products.
What you need to do: Most businesses must take reasonable steps to make sure no one vapes indoors at any time. This includes your workers, customers, suppliers and others who visit your premises.
In work vehicles, vaping is only allowed if:
the public doesn’t usually have access to your work vehicles
all workers who use the vehicles agree to it in writing.
In restaurants, cafés, bars and pubs, take reasonable steps to make sure people only vape in open areas. If you run an early childhood centre, no one can vape indoors or in outdoor areas, eg playgrounds, sandpits.
Vaping information for business and employers(external link) — Ministry of Health
If your business sells vaping products, make sure you:
only sell to people aged 18+
check and act on the new rules for advertising vaping products
know what you can and cannot say to customers about vaping.
Vaping information for all industry(external link) — Ministry of Health
Sick leave
Once they’ve worked for you for six months, employees are entitled to at least five days paid sick leave each year. You must also:
carry over unused sick leave into the next year. The maximum accumulation is 20 days — although you can provide more if you want to
allow employees to use sick leave to care for a sick or injured spouse, partner, dependent child or any other dependent individual
pay employees what they’d usually earn for the days they’re on sick leave.
Read more about sick leave.
Bereavement leave
Once they’ve worked for you for six months, employees are entitled to paid bereavement leave of:
three days if their partner, parent, child, sibling, grandparent, grandchild, or their partner’s parent dies
one day on the death of a person outside their immediate family (if you accept that your employee has suffered a bereavement).
They’re allowed to take their bereavement leave at any time and for any reason that relates to the death.
Read more about bereavement leave.
Domestic violence leave
Once they have worked for you for six months, employees affected by domestic abuse can take up to 10 days’ paid domestic violence leave.
To qualify, at least one of these situations must apply to your employee:
They have experienced domestic violence.
They live with a child who has experienced domestic abuse — even if the child only lives with them sometimes.
There is no time limit on when the domestic violence occurred.
Like sick leave, the domestic leave entitlement renews every 12 months. Employees cannot carry over unused days.
You do not have to pay unused days if the employee leaves.
Read more about Domestic violence leave
Parental leave
Employees may be entitled to 26 weeks of government-funded parental leave payments. Employees who’ve worked for you for six months (for an average of at least 10 hours a week) are also entitled to take up to 26 weeks of unpaid parental leave.
They can take up to 12 months if they’ve worked for at least 10 hours a week for a year or more. Workers who have worked for you for less than six months may also be entitled to parental leave, in certain situations.
Parental leave has information on who can take it.
Unpaid leave
Employees can apply for unpaid leave for any reason — but it’s totally up to you whether or not to agree to it.
If you let an employee take unpaid leave of more than a week throughout the year, you’ll need to consider how it will affect their annual leave entitlements and payment calculations.
Unpaid leave has more information.
Next step
Working out what you need to pay employees when they’re taking leave can be complicated – but with the right systems and processes in place, it doesn’t have to be difficult.
SOURCE: BUSINESS.GOVT.NZ
