ACC Levy rates 2017/2018 - confirmed rates

ACC has released its levy rates for the 2017/2018 year.

The levies apply as follows:

Employers

Levies are imposed by invoice from ACC from information it receives from Inland Revenue, for both PAYE filing and from income tax filing.

All businesses are required to pay ACC levies on behalf of employees based on:

1) The type of business it is (Business Industry Classification or BIC),

2) the wages cost ,and

3) the individual business’ injury record.

The combined average levy rate of $0.72* is per $100 liable earnings. Tables have been published detailing rates for each BIC.

Points to note

Levies apply to both PAYE employees and shareholder employees.

ACC levies are not paid by businesses on behalf of contractors they engage.

Shortfalls of payment on each instalment will still be subject to interest and penalties.

Contractors / Self employed

Contractors are responsible for their own ACC levies (as contractors are considered a business by ACC).

Employees

Deducted from gross earnings with PAYE each pay period.

Employees pay ACC levies to their employment account, either as part of their PAYE deductions or, particularly for shareholder employees, as part of their end of year tax obligations (invoiced to them by ACC).

The levy is increasing to $1.21* per $100 of earnings

Motor vehicles

The 2017/2018 Motor Vehicle levy rate comes into effect on 1 July 2017.

Covered in vehicle registrations and petrol use.

The levy of $113.94* is a combined average rate per vehicle.

* Excludes GST

The levy rates are calculated by ACC to fully fund the cost of the ACC scheme. The scheme covers pay-outs to injured parties for loss of earnings, medical costs, managing at home costs after injury and for the cost of administration of the scheme.

In calculating premiums charged to businesses, industry classifications have differing premium rates based on ACC’s assessment of risk, cost and frequency of injury within the industry. Premiums are higher in industries where these are higher. Therefore it is important that your industry classification is appropriate and matches the type of business.

According to ACC if more than one BIC applies to your business, the highest levy rate prevails, unless, in rate circumstances, your business is eligible to be assigned multiple classifications. There are also different plans and levels of cover available depending on the type of business.

For many of our clients we receive their ACC invoice and check its correctness. It is then forwarded for payment. This check ensures the correct BIC and agreement with internal records for total payroll cost.

If you are unsure of any aspect of ACC, please contact us.