The 2026 Budget doesn’t introduce any major tax changes, providing some welcome certainty for businesses planning ahead. However, there are a few key developments employers should be aware of.
Higher Employment Costs
You’ve likely heard about the recent KiwiSaver changes, when employer contribution rates rose to 3.5% as of 1 April 2026. While this has already added to payroll costs, it’s only the first step, with contributions set to rise again to 4% from 1 April 2028. Read more here.
Increased IRD Focus
The Government has signalled a continued focus on Inland Revenue compliance activity. This places greater importance on ensuring payroll, PAYE, KiwiSaver and tax obligations are accurate and up to date.
Potential FBT Simplification for Vehicles
A simplified FBT system is proposed, replacing vehicle day-counting and logbook requirements with a category-based approach based on private use. The changes are intended to reduce compliance costs for employers and would apply from 1 April 2027.
What Should You Do?
Now is a good time to review:
- Payroll processes and KiwiSaver costs
- FBT arrangements for company vehicles
- Overall compliance systems and record-keeping
If you’d like to discuss how these changes may impact your business, we’re here to help.
Contact the YHPJ team for advice tailored to your situation.
