We believe in looking after everyone on our platform, including our contract workers. We want to support you to do great work supporting others in your community.
When you work as an independent contractor in New Zealand you are required by law to pay tax.
How does Mycare help with my tax payments?
A 10% deduction of tax in the form of a voluntary schedular payment is automatically made for every hour you are booked and paid through Mycare, and Mycare pays this to the IRD on your behalf.
This will show in your MyIR as a schedular payment from pAI2 Ltd (the company that runs Mycare).
Please note that this 10% is often not sufficient to fully meet tax obligations, and you are responsible for managing that and being prepared if come the end of the financial year you owe the IRD for tax. Our best advice is to stay on top of your expected annual income, and put a small amount aside each week to cover any extra tax and ACC liability.
What will I need to do about my tax payments?
At the end of the financial year, you will need to file an IR3 to make sure you've paid the right amount of tax. You may even get a refund.
If you fill our your IR3 online (via MyIR) your income from Mycare will already be prepopulated. Note that mileage and expenses reimbursed to you are not taxed.
When filling out your tax return you can deduct certain expenses you have incurred to earn you income. Have a look at the IRD Help Page here to make sure you get all the deductions you are entitled to. Deductions will reduce your taxable income before your tax is calculated.
Tax deductions include:
- Work related expenses
- Further education expenses
- The cost of managing your tax (e.g. paying an accountant)
- Charitable donations.
It’s important for this reason to keep track of your business expenses throughout the year. If you are not sure about any expenses talk to your local accountant.
You can not claim for expenses that a client has already paid you for on Mycare (eg mileage).