Child support is managed via a specific set up in payroll, as it as it forms part of the tax payments that are sent and filed to IRD. IRD have requirements for how child support payments are filed to them, so they must be added to your employee’s set up through the specific child support deduction option.
There are also specific rules about how child support is managed in relation to an employees income with a variety of different codes that we will use in the IRD filing as necessary.
Setting up a child support deduction
Go to ‘Employees’ on the left hand side menu.
Select the ‘Settings’ tab, then choose ‘Child Support’ on the menu in the middle of your screen.
Turn the on/off switch to on (showing orange) and a deduction amount field will be available.
Enter the amount in the deduction amount field, then select save in the top right hand corner.
This is the amount that will be deducted from each pay. You’ll need to make sure you’re looking at the amount IRD has told you to deduct and the frequency - if you pay fortnightly you’ll need to ensure you enter a fortnightly amount (not a weekly value).
To edit a child support amount, return to this area and update the amount, then select save.
Changes will take effect immediately and cannot be dated for a future date. You can use our notes feature to remind yourself to make the change at a future date if you need to.
Turning off a child support deduction
To turn off a child support deduction:
Go to ‘Employees’ on the left hand side menu.
Select the ‘Settings’ tab, then choose ‘Child Support’ on the menu in the middle of your screen.
Turn the on/off switch to off (showing grey) and the deduction amount field will be removed.
Click save in the top right hand corner.
If a child support deduction is lower than expected
If your employee’s income in a pay run drops below a certain amount, the child support may automatically adjust.
IRD sets out specific rules for managing child support as a percentage of an employee’s net income. There is a threshold where a child support payment may be automatically adjusted - this is called protected net earnings. PaySauce will automatically apply these rules for you and file the correct codes as part of your payday filing, so there’s nothing special you need to do to set this up or ensure it applies.
ℹ️ You can read more about protected net earnings here on the IRD website: deductions from employee wages.