How self-employed people can make the most of KiwiSaver

man holding a piggy bank

Employees in New Zealand have their KiwiSaver handled for them. But it’s easy for business owners to forget about setting themselves up correctly.

What is Kiwisaver?

It’s New Zealand’s voluntary savings scheme, designed to provide everyone with investments that support their retirement.

What makes KiwiSaver different from regular investments is that you can’t take money out whenever you like. Besides a few exceptions, it’s restricted until you’re 65 or buying your first home.

Long-term investment and savings schemes are truly important. People without long-term savings will one day find themselves living on government Superannuation payments, which are small amounts that cover a “no-frills” lifestyle.

The catch is that whereas KiwiSaver is automatically deducted from employees’ pay, self-employed folk must set it up for themselves.

How KiwiSaver benefits the self-employed

Alongside adding structure to your savings, contributing regularly to your KiwiSaver provides a phenomenal benefit. The government will give you $521.43 per year whenever you put in at least $1,042.86 yourself. This is the best return on your money you’ll ever make!

If your partner doesn’t yet have KiwiSaver, get them signed up and contribute the same minimum amount – you’ll each get the government top-up.

Choosing your level of risk

It’s up to you to decide on a risk profile for your KiwiSaver investments.

A great rule of thumb is that the further away your retirement is, the higher the level of risk you can take. Taking more risk when you’re young is a good move because history shows us that higher-risk investments deliver better returns in the long run. However, if your retirement isn’t too far off, a conservative risk profile is better. You won’t have as much time for your investments to recover in the case of an economic dip.


The fees you’re charged for the management of your KiwiSaver fund are generally very low, relative to other funds. You can get guidance on fund types and fees over at Fundfinder.

How do I get set up?

If you’re not enrolled in KiwiSaver, you can contact a provider directly. Once you’re enrolled, you can set up a regular payment from your internet banking to your KiwiSaver provider, or manually make lump-sum payments.

To help your decision-making, we recommend calculating how much you would like to live on during your retirement. There’s a handy tool for figuring that out, here.

How does it work if I have staff?

Whenever you employ staff, they are typically automatically enrolled into a KiwiSaver scheme (the criteria they need to meet is very minimal). If they choose to stay enrolled, they notify you how much of their pay they’d like to contribute each pay period.

Your payroll software will automatically include this in the returns made to Inland Revenue.

As an employer, you must provide a minimum contribution of 3% to each employee who’s enrolled. This is in addition to what you pay them.

Your employees never see this 3% – it’s sent directly to their KiwiSaver provider and Inland Revenue.

How do I account for my own Kiwisaver?

If you’re an employee of your business receiving PAYE-paid wages, you’re sorted. The business pays its 3% contribution and your personal portion via the payroll system – the same as all other employees.

If you’re not an employee, or if you’re a sole trader, contributions are personal expenses. Moving funds from the business bank account to your personal KiwiSaver account should be recorded as drawings.

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Our Beany support team is ready for any questions you might still have. However, we aren’t financial advisors, so we can’t advise you on choosing a particular KiwiSaver fund! [email protected] or 0800 755 333

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