Kiwisaver question - opting out and refunds

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Forums › Finance and wealth management › Kiwisaver question - opting out and refunds

heavenlywild

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#311314 5-Jan-2024 13:43

Quick question. A friend has opted out of Kiwisaver and filled in the form. In the first pay run they got deducted Kiwisaver. When they asked if the deduction will be returned as they have opted out, payroll said no.

This surely can't be right?

l43a2

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#3177983 5-Jan-2024 13:54

that sounds pretty dodge..

PolicyGuy

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#3177984 5-Jan-2024 13:55

IIRC Payroll can't give it back because they haven't got it.
Kiwisaver deductions get remitted to IRD with PAYE each pay run - it used to be monthly but IRD changed the process (about 2019?) to make it less complicated for employers.

heavenlywild

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#3178038 5-Jan-2024 14:31

PolicyGuy:

IIRC Payroll can't give it back because they haven't got it.
Kiwisaver deductions get remitted to IRD with PAYE each pay run - it used to be monthly but IRD changed the process (about 2019?) to make it less complicated for employers.

So I can expect the refund via the IRD at some point?

cddt

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#3178039 5-Jan-2024 14:33

Sounds like payroll screwed up by not configuring his pay correctly. Unfortunately not uncommon.

The money will be with IRD now - they'll just send it on to his KS provider and it will accumulate on his KS balance. Don't think there's any chance of getting it back now.

Your friend needs to chase his employer's payroll person to ensure the second pay run is processed correctly, i.e. without KS deduction.

cddt

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#3178044 5-Jan-2024 14:35

Actually forget the above, please review this page which will tell you everything you need to know: https://www.ird.govt.nz/kiwisaver/kiwisaver-employers/employees-who-want-to-opt-out-of-kiwisaver

wellygary

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#3178054 5-Jan-2024 15:20

cddt:

The money will be with IRD now - they'll just send it on to his KS provider and it will accumulate on his KS balance. Don't think there's any chance of getting it back now.

If they have a previous KS provider the funds will end up there and its unlikely it will be returned ...

BUT , It sounds like they had the funds taken from their payroll, but had not signed up with a provider, and then opted out...

In this case it will be floating round in IRD and will eventually get returned when its clear there is no KS account and provider for the funds to be sent to...