Changes to Self-Employed ACC Levies

Changes to Self-Employed ACC Levies

Changes to Self-Employed ACC Levies

ACC have announced changes to the way they levy people who are self-employed.

Until now, ACC have always levied people based on their prior year’s earnings. This is the income declared to Inland Revenue when we file your return.

So What’s Changing?

From the 2020 year, levies will be based on actual earnings. As such, levies will be sent after the levy year has finished.

This is a welcome change as the levy will be more accurate.

How will it work?

If you are self-employed, you’ll receive your 2020 CoverPlus invoice starting around July or August 2020. Previously you would have received an invoice in July or August 2019.

The invoice won’t be based on your previous year’s earnings, instead it will be based on your actual earnings, filed with IRD, for the year ending 31 March 2020.

What if you have Ceased Trading?

You should always let ACC know if you have ceased trading – just as you do with Inland Revenue.

2019

If you ceased trading during the year ended 31 March 2019, you will already have paid a CoverPlus invoice based on your 2018 earnings. You simply need to let Inland Revenue know what your 2019 earners were, and they will send you a reassessment. You might be in for a refund!

2020

If you cease trading during the 2020 year and you don’t want to wait for your CoverPlus invoice, you will need to let ACC know what your earnings were. Alternatively, Inland Revenue will inform ACC once that information is filed with them.

CoverPlus Extra

There are no changes for self-employed people electing to use the CoverPlus extra scheme. This is for taxpayers who pay themselves drawings and have an agreed level of cover.

If you want to learn more about CoverPlus Extra, click on the link here.

 

As always, don’t hesitate to contact us if you have any queries about Accident Compensation. We are only too happy to help.

Angus is the CEO and founder of Generate Accounting.