Employee leaving country continuing to work remotely - how manage employee card and tax?

[CellarbratRiv]

One of our staff is heading to NZ to live but will continue to work for us remotely.

I have looked online and discovered due to the reciprocal relationship between the governments the PAYGW in Australia drops to zero and the employee is responsible for declaring foreign income and paying their own tax in NZ.  Super contributions are no longer required but can continue at the discretion of the employer.

What I was wondering is how do I manage this in MYOB? 

Should I create a new employee card or change the tax table in the current card?

Do they need to complete a new TFN dec?

What tax table should I use? Foreign Resident?

In the tax section  - should I select PAYG Witholdng tax? Or leave it unselected since its supposed to be zero?

IS there anything else I need to be aware of?

Thanks!

[Earl_HD · Accepted solution]

Hi @CellarbratRiv.

Thank you so much for your post and welcome to the Community Forum! I'm sorry to hear about the issues you've been facing. I really appreciate your patience and understanding about this issue, and I do apologize for the delayed response. To address your inquiry, I recommend consulting with a tax professional or accountant, or seeking legal advice to ensure full compliance. However, here are some fundamental details to consider.

Managing an employee who relocates and continues to work remotely from there in MYOB involves several considerations. Since tax regulations can be complex, it's essential to follow proper procedures to ensure compliance. 
 

Update Employee Details:

• Update the employee's address and employment details in MYOB to reflect their new location in New Zealand.

Tax Residency Determination:

• Confirm the employee's tax residency status. Since they will be residing and working in New Zealand, they are likely considered a tax resident of New Zealand and should declare their foreign income there.

PAYG Withholding:

• You should change the PAYG Withholding tax to zero for this employee. This indicates that no tax should be withheld in Australia as they are no longer an Australian resident for tax purposes.

TFN Declaration:

• If the employee has previously completed a TFN (Tax File Number) declaration for Australian tax purposes, they may need to complete a new declaration or update their details to reflect their new tax status as a non-resident.

Feel free to post again, we're happy to help.
Regards,
Earl

[lmb1707]

Hi

We are about to onboard an employee who lives in NZ.  All the work he will complete is NZ based. We are applying for an IRD Number and complateting NZ PAYE Tax Withholding.  How do I get our software  to communicate with New Zealand's Inland Revenue?

Thanks In Advance

Liana Batty

[Princess_R]

Hi @lmb1707,

Thank you for your post.

I understand the need to streamline your processes for the New Zealand-based employee. I regret to inform you that since your business is registered with the Australian Tax Office (ATO), the current software subscription is designed specifically for Australian reporting. It doesn't facilitate direct communication with New Zealand's Inland Revenue. However, to accommodate your employee's needs, you could consider purchasing MYOB Business Payroll specifically for this individual in New Zealand. This version is tailored to comply with NZ's tax regulations and can help manage NZ PAYE Tax Withholding and other related requirements for that employee. While it might involve an additional purchase, it ensures compliance with NZ tax laws for the specific NZ-based work.

I would also recommend reaching out to your accountant regarding this matter.

Please let me know if you require any further assistance. I'm here to help.

If my response has answered your question, please click on "Accept as Solution" to help other users find this information.

Cheers,

Princess

[lmb1707]

Thanks Princess, I will keep you link o NZ Software as I Will need it.

[Princess_R]

Hi @lmb1707,

You're welcome! Feel free to keep the link for NZ Software handy for whenever you might need it. If you have any more questions or if there's anything else I can assist you with in the future, please don't hesitate to reach out.

Cheers,

Princess