As contract employee how to pay tax

[nicklau81]

Hi,

If we are a contract employee how to pay the tax and register / pay GST?

Thanks

[GrumpyGoat]

You have to pay tax at the end of the first year. If your tax owed is over $2500 the first year, you have to make provisional payments after that.

Unless you make more than $60,000, you don't have to GST register.

It is probably worth talking to an accountant to make sure you get set up correctly.

[mangotea]

Are you a non-resident? You may want to check this out.

http://www.ird.govt.nz/yoursituation...ntractors.html

[nicklau81]

No, I am a resident.

Any contractors would please share their experience?

[eternalkiwi]

If you work as a contractor you are self employed, or you can operate through your own company where you work as an employee of the company. For tax residents who work as self employed contractors, as GrumpyGoat said, you pay tax at the end of the year so it is usually recommended to save 20-25% of your income as you earn it so you have the money when it comes tax time.

If you work as a fixed term contract employee, you are taxed as a normal employee (PAYE), and as Mangotea highlighted if you are a non tax resident (which is different to a permanent resident) there are different tax liabilities.