If your KiwiSaver scheme is a widely-held superannuation fund, your investment earnings are taxed at 28%.
If you're eligible, the Government will contribute 50 cents for every dollar you contribute to your KiwiSaver account, up to a maximum of $521.43 each year. That's extra money to add to your KiwiSaver savings - and it could add up to a whole lot more over time.
While you may be required to pay more tax than expected this year due to an incorrect prescribed investor rate (PIR) supplied to your KiwiSaver or investment provider, to correct this you just need to contact your provider whether it be your bank or investment management company to have it changed.
?You can make voluntary contributions (or lump sum payments) at any time, either directly to your KiwiSaver provider or through Inland Revenue. Once you've made a lump sum payment it's "locked in" until you're eligible to withdraw your savings. You can make payments directly to your KiwiSaver provider.
They're called 'compulsory employer contributions (CEC)'. The lowest rate for your contribution is 3% of your employee's gross salary or wages. You make a contribution to your KiwiSaver employees: aged 18 and over.
KiwiSaver is not compulsory for people starting a new job, but they will have to opt out rather than opt in if they don't want to join.
In order to make a voluntary contribution to your KiwiSaver account through Inland Revenue by way of internet banking, you'll first need to choose the 'Pay tax' option on your internet banking service. Then, you'll need to include your IRD number, the tax type “KSS”, and period “0” (zero).
Once you've been a KiwiSaver member for 12 months or more, and have been making regular contributions from your salary or wages, you can apply to Inland Revenue to take a savings suspension. Contact them on 0800 549 472 or 04 978 0800 or visit the website to download a savings suspension request form.
If you die while you are a member of a KiwiSaver scheme your full account balance will be paid to your estate. You can't nominate people (called 'beneficiaries') to receive your funds directly from your KiwiSaver Scheme; your provider always has to pay it to your estate.
Your KiwiSaver funds are an asset. You may be able to use your KiwiSaver funds to pay off your debts if you become bankrupt. However in the case of a KiwiSaver scheme, the funds are protected from your creditors while they remain in the fund.
You may be eligible to withdraw KiwiSaver funds early if you are experiencing financial hardship. To withdraw funds you will need to provide evidence you are suffering significant financial hardship. If your application is accepted you can only withdraw your and your employer's contributions.
Yes, you will be eligible to take out all the money that is in your KiwiSaver account. That's all your contributions, your employer contributions, the government kick start and member tax credits, plus or minus any returns on your investments. But you don't have to take your money out.
The main risk of receiving less than you invested, or a lower return than expected, from the Fund or Funds chosen is adverse market performance. The prices and values of securities held by a Fund within the AMP KiwiSaver Scheme will fluctuate as a result of changes in market conditions.
You can find out more by reading this blog post about using KiwiSaver to buy your first home or visiting the KiwiSaver website. Gifting: You can use a cash gift from your parents (or someone else) as part of your deposit.
Simplicity's Conservative Fund is the #1 performer for 1-year and 3-year returns. Its low fee structure helps achieve this and means you can spend the money (and not lose it in above-average fees). More details: Simplicity KiwiSaver review.
If you have been a member of KiwiSaver for at least three years, you may be able to withdraw all, or part, of your savings to put towards buying your first home. Eligible members can withdraw their KiwiSaver savings (including tax credits). However at least $1,000 must remain in their KiwiSaver account.
You can only make a KiwiSaver first home withdrawal once. If you've owned property before, you may qualify for a second chance home buyer withdrawal. You may also qualify for a HomeStart grant.
Q. Can you apply to withdraw your KiwiSaver savings for a holiday or to purchase a boat or a car? A. No, unfortunately a withdrawal can't be made for these reasons.
Financial hardship typically refers to a situation in which a person cannot keep up with debt payments and bills or if the amount you need to pay each month is more than the amount you earn, due to a circumstance beyond your control.
If you move overseas permanently, other than to Australia, you can withdraw your savings (excluding any Australian sourced funds) from KiwiSaver after you've been overseas for one year. To apply, please complete our Permanent Emigration Withdrawal Application Form (PDF 56kB).
You can usually start withdrawing from your KiwiSaver account when you turn 65. If you joined KiwiSaver or a complying superannuation fund before 1 July 2019, you may be subject to a five-year membership requirement before you can start making withdrawals.
You're eligible to withdraw all your KiwiSaver funds when you reach the age of eligibility (currently 65). If you joined KiwiSaver before 1 July 2019 and were aged between 60-64 you would have been locked into KiwiSaver for 5 years. Being locked in meant you could not withdraw your funds when you were 65.
What are some of the benefits of KiwiSaver?
- Government Contribution. As long as you are eligible, for every dollar you put into KiwiSaver the Government will put in 50 cents, up to $521.43 each year.
- Employer Contribution.
- First home.
The more time you have to invest, the more sensible it is to select a higher-risk fund, and the more return you should get over time. But if you need your money sooner, you're better to choose a low-risk fund. The fund your KiwiSaver money is in might need to change over your lifetime.
If you stop earning a salary or wages, your employee contributions to KiwiSaver will stop. You can make voluntary contributions to your KiwiSaver scheme. When you start work again, automatic deductions from salary/wages will begin again.
"You could also argue that now's a good time to start KiwiSaver because markets have fallen and you're buying in at a lower starting point." And while you might have seen balances drop over the last few months, it's important to know that KiwiSaver accounts are tightly regulated by the Government.
KiwiSaver can be a cost effective and accessible form of investment for retirement. There is no need to cash it up. Leaving all your money in bank deposits for a 30-year retirement is an unnecessarily conservative approach and KiwiSaver funds offer the ability to remain diversified with exposure to growth assets.
