Hierarchy
SAP_HRCNZ (Software Component) Sub component SAP_HRCNZ of SAP_HR⤷
PY-NZ (Application Component) New Zealand⤷
PC43 (Package) HR accounting: New Zealand
IMG Activity
| ID | PY_NZ_CKS_001 | Enable Compulsory KiwiSaver Contribution Check |
| Transaction Code | S_L4H_49002512 | (empty) |
| Created on | 20111102 | |
| Customizing Attributes | PY_NZ_CKS_001 | Enable Compulsory KiwiSaver Contribution Check |
| Customizing Activity |
Document
| Document Class | SIMG | Hypertext: Object Class - Class to which a document belongs. |
| Document Name | PY_NZ_CKS_001 |
Use
As specified by authorities, the employer must make a minimum contribution to employee's KiwiSaver. However, if the employer is contributing to both KiwiSaver and Registered Superannuation Scheme (RSS), the employer's contribution can be less than the minimum statutory contribution in some cases. This shortfall occurs when the RSS fund contribution of the employer is calculated on base earnings and not taxable gross earnings. In this case, the legislation states that the minimum contribution across all scheme contributions must be based on total taxable gross earnings.
In case of KiwiSaver, the system calculates the employer contribution on the basis of the total taxable gross earnings, whereas, for RSS funds, the system calculates the employer contribution on the basis of base earnings. Therefore, total employer contribution can fall short of the minimum statutory contribution. If you enable this compulsory KiwiSaver contribution check, the system increases the employer's contribution towards KiwiSaver to meet the statutory minimum contribution.
Note
In the standard SAP solution, this functionality is commented because most employers do not contribute to more than one superannuation fund and hence, there is no need for this processing. However, if an employer splits the compulsory contributions between KiwiSaver and another fund, then, they should activate this functionality.
Requirements
Standard settings
Activities
To activate this functionality, you must:
- Set all wage types relating to company superannuation contribution to RSS Company Contributions (48) cumulation class. Note that you must not set KiwiSaver wage types to this cumulation class.
- Uncomment the following rules in the Superannuation Processing New Zealand (NZSU) and Processing Table DDNTK, Deductions not Made (NZD2) schemas:
- Registered Superannuation Scheme (NZRS)
- Employer Minimum Contribution (NZMC)
- Adjust the Kiwisaver Employer Contribution Difference (NZKD)
- Employer contribution difference (NZCD)
Example
Consider that an employee earns a base salary of NZD 1000 in the pay period but earns an additional NZD 100 for working overtime. The employee is a member of both KiwiSaver and RSS funds. The employer decides to contribute 1% to both schemes and the compulsory contribution is 2% of gross taxable earnings. In this case, the contribution to the KiwiSaver is 1% of gross taxable earnings, that is, NZD 11. Here, the employer's contribution to the RSS is 1% of NZD 1,000, which is NZD 10 leading to a total of NZD 21. However, the employer must contribute a minimum of 2% of gross taxable earnings which is NZD 22. If you activate this functionality the system increases the employer contribution to KiwiSaver by NZD 1 to meet the minimum statutory contribution.
Business Attributes
| ASAP Roadmap ID | 204 | Establish Functions and Processes |
| Mandatory / Optional | 2 | Optional activity |
| Critical / Non-Critical | 2 | Non-critical |
| Country-Dependency | I | Valid for countries specified |
| Customizing Attributes | Country Key | Country Name |
|---|---|---|
| PY_NZ_CKS_001 | NZ | New Zealand |
Assigned Application Components
| Documentation Object Class | Documentation Object Name | Current line number | Application Component | Application Component Name |
|---|---|---|---|---|
| SIMG | PY_NZ_CKS_001 | 0 | HLA0003855 | New Zealand |
Maintenance Objects
| Maintenance object type |
History
| Last changed by/on | SAP | 20111104 |
| SAP Release Created in |
