Around 1.5 million Kiwis have the wrong tax rate, or PIR (prescribed investor rate) listed, says the IRD.*
This includes the wrong PIR for many KiwiSaver accounts.
But the news left many people confused about what a PIR is, and what they need to check.
What is a PIR?
Your PIR determines the tax you pay on the returns from your KiwiSaver investment. The rate of tax you pay is based on your income. PIR is 10.5%, 17.5% or 28%.
Why is your PIR important?
If you pay too much tax on your KiwiSaver account, you can’t get this back. And if you don’t pay enough tax, you have to top it up.
How often should I check my PIR?
It’s a good idea to check your PIR every March, toward the end of the financial year. If your income has gone up or down, you may be now on the wrong PIR.
How do I know what my PIR is listed as?
If you log into your KiwiSaver account, you should be able to see the PIR on file for you. Or, you can contact IRD.
My PIR is wrong, how do I change it?
Within your KiwiSaver account portal, you may be able to change it yourself. Otherwise, just contact your KiwiSaver provider, or the IRD.
*Source: IRD media release
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