WHAT IS KIWISAVER?
- KiwiSaver is a voluntary savings scheme aimed at encouraging New Zealanders to save for their retirement.
- Money saved in KiwiSaver accounts is locked in until you are eligible to receive New Zealand Superannuation (currently 65) or 5 years after you joined a KiwiSaver scheme (whichever is the later).
- You can choose your own KiwiSaver provider, and change your provider at anytime.
- New employees are automatically enrolled in KiwiSaver by their employer and have up to 8 weeks to opt-out if they wish to.
- Other employees and people who are self-employed or not employed can opt-in to KiwiSaver.
- Once a person has opted-in to KiwiSaver, they cannot opt out.
- KiwiSavers who are employees must contribute either 2%, 4% or 8% of their gross salary or wages.
- If you change employment your membership in a KiwiSaver scheme is not affected - your KiwiSaver account follows you wherever you are employed in New Zealand.
- If you stop working, your KiwiSaver account stays open and you are free to contribute to it voluntarily.
- After contributing for 12 months, employees can apply to the Commissioner of Inland Revenue for a "contributions holiday" which suspends KiwiSaver deductions for up to 5 years.
WHO CAN JOIN?
To join KiwiSaver you must be:
- A New Zealand citizen or entitled to live in New Zealand indefinitely;
- Living or normally living in New Zealand; and
- Under 65 years old.
To join IRIS-GMK you must also be:
- a union member (you will be required to state the union you belong to on your application form);
- immediate family of a union member (for the purpose of IRIS-GMK, immediate family is defined as spouses, children and parents).
As long as you satisfy the criteria above, you can join. Join now.
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WHAT YOU DO AND DON‘T GET
Everyone who joins KiwiSaver gets:
- a one-off $1,000 government kick-start grant three months after joining; and
Union members and their immediate family who join the Scheme using the IRIS-GMK application form get:
- a one-off $20 fee rebate paid into their member account at the six month anniversary of their acceptance as a member of the Scheme.
Members aged between 18 and 65 are eligible for:
- up to $1042 per year ($20 per week equivalent) dollar for dollar matching government contribution (called the member tax credit). Read about the ins and outs of tax credits on the GMK main website.
Members who are employees are required to contribute 2%, 4% or 8% of their salary or wages. Employees will be eligible for a 2% contribution from their employer.
Exclusions
- Minors (under 18s) are not eligible for the member tax credit.
- Employers are not required to make employer contributions to a minor‘s account, but they may elect to.
- Employees who are not contributing (e.g. are on a contributions holiday) are not automatically entitled to employer contributions (although an employer may choose to keep making contributions.)
- Members who are eligible to withdraw from KiwiSaver but who have chosen to remain in the Scheme will no longer be eligible for the member tax credit.
- Members who leave New Zealand to reside overseas (but who are not permanently emigrating) are not eligible for tax credits while they are not resident in New Zealand.
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WITHDRAWING FROM KIWISAVER
Ordinary withdrawals
You can withdraw money from your KiwiSaver account when you become eligible for New Zealand Superannuation (currently age 65) or after you have been a member of the scheme for 5 years, whichever is the later. This means that if you join up at age 61, you will have to wait until you are 66 to make withdrawals. If you join up when you are 64, you will have to wait until you are 69.
Early withdrawal
There are some circumstances where you may apply to the trustees of your KiwiSaver scheme to withdraw your savings early:
- After three years in KiwiSaver to buy your first home (excludes the $1,000 kickstart and the member tax credits).
- If you experience significant financial hardship (excluding the $1,000 kickstart and the member tax credits).
- If you suffer serious illness the total amount of your KiwiSaver account.
- If you emigrate permanently (including the $1,000 kickstart but excluding the member tax credits, which are paid back to the government). You can apply to withdraw your savings 12 months after you leave New Zealand.
- On your death, the total amount of your KiwiSaver account will be paid to your estate.
In most cases you apply to your KiwiSaver scheme provider if you want to withdraw your savings. If you experience significant financial hardship or serious illness within the first three months of joining KiwiSaver, you‘ll need to apply to the IRD.
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CHANGING KIWISAVER PROVIDERS
You can change KiwiSaver providers whenever you like.
The KiwiSaver rules state that members can choose their own KiwiSaver provider and can change provider at any time.
Changing your account from another provider to IRIS-GMK
Just complete our online application process and we handle the rest.
- We’ll contact IRD to update your records.
- We’ll contact your old provider and arrange a transfer of your money.
- We’ll set you up with an IRIS-GMK account so you can track your contributions and your investments.
There are three IRIS-GMK application options for union members and their immediate family, (eligible family members are spouses, children and parents):
- Employee form: Use this form if you are between 18 and 65 and any of your income is subject to PAYE deductions.
- Self-employed and not employed form: Use this form if you are between 18 and 65 and none of your income is subject to PAYE deductions or you are: retired; unemployed; on ACC; on un-salaried maternity leave.
- Minors‘ application form: use this form for under 18s, whether they are working or not.
Changing from IRIS-GMK to another provider
We don‘t want to see members leaving us, but we understand that it will happen. Just join your new provider and they will contact us to transfer your funds to their scheme. No questions asked.
If you‘d like to talk to us before you decide to make a change of providers, call us during business hours on 0800 427 384.
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For more details on KiwiSaver visit IRD‘s KiwiSaver website: www.kiwisaver.co.nz.