An employee's membership of the KiwiSaver scheme is based on whether they started before or after the scheme began, whether they are a casual employee, their age, whether they have opted in or opted out, the default settings you make for your business, and a few other things.

If it sounds confusing, it is - but hey, this is Ace Payroll. We eliminate all that confusion.

In the example below, an employee has been added to the payroll with the minimum of details, after 1st July 2007.

We are in the pay calculation screen, processing their first pay.

Based on the various membership criteria, Ace Payroll has decided the employee is subject to the Automatic Enrolment rules.

Note the line showing the employee KiwiSaver deduction, the rate, and the amount deducted. These have been added automatically, based on the employee's default membership status.

Note also the option to Opt Out the employee. We have circled it yellow.

Clicking Opt Out takes you to the KiwiSaver Employee Setup screen, from where you can opt out the employee if required.

Note also the Opt Out option is shown red because no KiwiSaver deductions have ever been made for this employee.

If an employee wants to opt out of the scheme, it is best for that to be decided when paying their first pay.

Once a KiwiSaver deduction has been made, the Opt Out option is shown blue until the 2 month time limit for opting out has elapsed.

Note that if an employee opts out after their first pay, they will have already made a KiwiSaver deduction, which the IRD will refund to the employee in due course. For more information on refunding contributions see KiwiSaver Adjustments.