You keep part of the funding as a fee for your services. You'll need to pay income tax and GST on this.
If you hire staff, you'll need to register as an employer. You'll need to deduct PAYE, KiwiSaver, student loan and child support deductions.
If you hire a self-employed contractor, they'll take care of their own taxes.
Individualised funding hosts cannot hire private domestic workers to work at a client’s house. Private domestic workers need to be employed by the person who lives in the home they work at.
If you're employed by an individualised funding host or client, they'll deduct PAYE and child support, KiwiSaver and student loan repayments from your salary or wages.
If you're employed by an individualised funding client, you'll be a private domestic worker if you answer 'yes' to all these questions:
If you’re a private domestic worker you'll have to register as an IR56 taxpayer. You'll need to take care of your own PAYE, child support, KiwiSaver and student loan repayments.
If you're not an employee you'll be an individualised funding contractor. As a contractor you need to pay your own taxes. You might need to pay provisional tax, and you'll need to file an individual income return each year. If your income is more than $60,000 a year, you’ll need to register for GST.
You need to keep full and accurate records of when and how much you were paid, and who paid you. You must keep these records for at least 7 years.
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