When processing New Zealand pay batches in FastTrack360, the system calculates the Payee KiwiSaver deduction for each eligible payee at the Gross Deduction and Net Deduction stages.
What's changed
Previously, when a pay batch was processed for a period in which a Payee KiwiSaver deduction had already been taken, whether as an in-period adjustment or an adjustment batch for a prior closed pay period, the system negated the previously applied deduction for that period and recalculated the deduction based on the payee's total earnings across all batches for that period.
In all cases, the rate applied was the rate in effect on the payment date of the current batch.
Now, the reversal-and-recalculation approach is no longer used when processing adjustments. Instead, the Payee KiwiSaver deduction is calculated based solely on the earnings within the current pay batch, with no reference to deduction amounts taken in prior batches for the same period.
This applies at both the Gross Deduction and Net Deduction stages, and to both in-period adjustments and adjustment batches for prior closed pay periods.
The rate applied depends on the type of batch being processed:
In-period adjustments (subsequent batches for the currently open pay period): the Payee KiwiSaver deduction rate valid on the payment date of the current batch is applied to the current batch earnings.
Adjustment batches (processing earnings for a prior closed pay period): the Payee KiwiSaver deduction rate valid during the period being adjusted is applied to the current batch earnings.
📌 Note: Where no valid Payee KiwiSaver deduction exists on the relevant reference date, for example, where the payee had opted out or was on a savings suspension during the period being adjusted, no Payee KiwiSaver deduction is calculated for that batch, and no reversal of any prior deduction occurs.
Benefits
This update aligns the Payee KiwiSaver deduction calculation for adjustments with the approach used for KiwiSaver employer contributions, providing consistent treatment across both contribution types.
For adjustment batches, applying the rate applicable to the period being adjusted ensures that historical corrections reflect the statutory conditions in effect at that time, rather than the rate current at the time the adjustment is processed.