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Inland Revenue

Tax Policy

Crown guarantee of employee contributions to KiwiSaver

(Clause 155)

Summary of proposed amendment

The bill amends the KiwiSaver Act 2006 to enable the Commissioner to operate the Crown guarantee of employee contributions in cases where he has sufficient evidence that the employee has incurred a deduction from their salary or wages, but the employer has not filed an employer monthly schedule (EMS).

Application date

The amendment will apply from the date of enactment.

Key features

The amendment will allow the Commissioner to use the Crown guarantee to pay an employee’s contributions to their KiwiSaver provider when the employer has not filed an EMS, but there is other evidence that the contributions were deducted from their salary or wages.

The employer’s obligation to file an EMS showing these contributions, or to pay the amounts due to the Commissioner, is unaffected by this amendment.


Section 78 of the KiwiSaver Act provides that an employee’s KiwiSaver deductions are guaranteed by the Crown, if the Commissioner is satisfied that the employer has taken the deduction from the employee’s salary or wages and the employer has filed an EMS.

The purpose of the Crown guarantee is to ensure that the full amount of the employee’s deduction is always forwarded to their provider, even when their employer has not forwarded the money to Inland Revenue.

Under the current legislation, the Commissioner can only use the Crown guarantee when the deduction is shown on the employer monthly schedule (EMS). This leads to difficulties and delays if the employer does not file an EMS. Even if an employee is able to provide satisfactory evidence that the contributions were deducted from their wages − for example, a payslip or payroll printout − without the EMS the Crown guarantee technically cannot be used. This is not consistent with the original policy intent.