The Government is offering great incentives to help as many New Zealanders as possible to save for a better standard of living in retirement through KiwiSaver.
KiwiSaver features
KiwiSaver has many features, including:
- A $1,000 kick-start contribution from the Government when you join a KiwiSaver scheme for the first time.
- A member tax credit of up to $521.43 per annum paid to your KiwiSaver scheme (subject to eligibility). The Government's member tax credit rate is $0.50c for every $1.00 you contribute up to a maximum of $521.43 per annum (subject to eligibility) for the KiwiSaver year 1 July to 30 June.
- After three years or more of saving in KiwiSaver, you may be eligible:
- For a first home deposit subsidy (through Housing New Zealand Corporation "HNZC") of $1,000 per year of saving, up to $5,000 in total;
- To withdraw contributions (except the Government kick-start contribution and member tax credits) for a first home purchase.
- After 12 months of contributing you can apply for a KiwiSaver contributions holiday.
- Your employer will generally be required to contribute 2% of your gross salary or wages where you are contributing to KiwiSaver. These employer contributions will not be subject to employer's superannuation contribution tax up to 2% of your gross salary or wages. The Government announced in the 2011 Budget that the compulsory employer contribution rate will increase from 2% to 3% of gross salary or wages with effect from 1 April 2013. From 1 April 2012, there will be no exemption from employer superannuation contribution tax for any employer contributions. From 1 April 2012, employer superannuation contribution tax will be deducted at your marginal tax rate before your employer contributions are forwarded to the scheme.
- You generally become eligible to withdraw your KiwiSaver savings when you reach the age of eligibility for New Zealand Superannuation (currently age 65) or five years from the date you become a member of a KiwiSaver scheme and/or a complying superannuation fund (whichever is later).
- You can apply for an earlier withdrawal in circumstances of significant financial hardship, serious illness or if you permanently emigrate (note this may exclude the $1,000 Government kick-start and member tax credits depending on the circumstances). Please see the Investment Statement for more information on early withdrawals.
The first home deposit subsidy and first home withdrawal benefits may also be used to buy land that you intend to build a home on, provided that it is intended to be your principal place of residence. If you want to use either of these benefits, you should apply for the benefit before you buy the land as you will be ineligible for the benefit after the land has been bought.
Both of these facilities will also be available to second-chance home buyers that meet the eligibility criteria as determined by HNZC. For more information see www.hnzc.govt.nz
Disclaimer
The FirstChoice KiwiSaver Scheme is provided by ASB Group Investments Limited.
The information contained in this website is for general informational purposes and is designed for use by New Zealand Residents only. None of the Crown, the Trustee, the Manager, ASB Bank Limited and its subsidiaries (the Banking Group), the Commonwealth Bank of Australia, or any other company in the Commonwealth Bank of Australia Group, or any of their Board members or directors (as the case may be), nor any other person or party, guarantees the securities offered in this website or the performance of those securities (including any of the investments or returns made in respect of the securities).
A copy of the Investment Statement for the FirstChoice KiwiSaver Scheme is available here or by calling 0800 1ST CHOICE (0800 178 246).
