How does payroll giving work?
Read through the Guide to Payroll Giving to understand how the scheme can be implemented in your workplace and the role of employers, employees, payroll administrators and donee organisations.
Who can I donate to through payroll giving?
An organisation needs to be approved by Inland Revenue as a donee organisation to be eligible to receive funds donated through payroll giving. Being on the Charities Register does not automatically qualify a group as a donee organisation because only Inland Revenue approves donee status.
It's not only charities that are included on the donee organisation list. For example, some state schools may be included on the donee organisation list however only certain donations made to these organisations will qualify you for a tax credit/deduction.
You can check if an organisation is an approved donee organisation by searching the donee organisation list on Inland Revenue’s website.
Why should I change how I give now?
Payroll giving is immediate, simple and rewarding. People donating through payroll giving don’t need to retain receipts and wait to file an annual claim form to get their donation tax credit. Payroll giving means the donation and the 33% tax credit happen immediately.
Payroll giving enables you to support an organisation on a regular basis. For the recipient donee organisation, payroll giving is an efficient, low-cost way to raise funds and receive regular income support.
Payroll giving isn't available in my workplace. How can I encourage my employer to participate?
Discuss payroll giving with your employer to understand their hesitations about the scheme and explore the different ways that payroll giving could be implemented within your workplace.
Your employer may wish to contact their payroll provider to ensure that payroll giving has been enabled within the payroll system and to understand how their services can assist in making payroll giving easy to implement and maintain. A number of payroll providers have established processes beyond basic payroll giving functionality to help their clients manage payroll giving donations. You can find out more by contacting one of the following organisations:
There are also a number of intermediary organisations that have developed solutions to work in conjunction with your employer's payroll system to facilitate payroll giving for employees, employers and donee organisations. These organisations may be able to help you overcome some of the challenges your employer might face in establishing and maintaining a payroll giving programme. Please contact the following organisations directly to find out how they can assist you:
If your employer is interested in payroll giving as part of a wider fundraising effort they may like to contact the Fundraising Institute of New Zealand for further advice.
Do I have to receive ongoing information from an organisation I donate to through payroll giving, or can I keep my contact information private?
This will depend on how your employer chooses to operate payroll giving and how much information you choose to share with the donee organisation. There is no requirement for the employer to pass on your contact information to the donee organisation(s) you donate to through payroll giving, however they may choose to do so with your permission. Speak to your employer about how this aspect of the scheme will operate in your workplace.
My employer is encouraging staff to support a cause through payroll giving. Do I have to participate?
No. Payroll giving is voluntary for employees. While your employer may encourage you to participate, there is no requirement for you to do so.
I want to participate in payroll giving but the organisation I'd like to give to is not included in my employer's payroll giving programme. What should I do?
Discuss your organisation's payroll giving programme with your employer to understand how recipient donee organisations are selected. Your employer may be interested in using the services of a payroll giving intermediary. These organisations can provide solutions which work in conjunction with an employer's payroll system and make it easy for employees to give to their donee organisation(s) of choice without requiring a lot of administration on the part of your employer.
To find out more about how these solutions work please contact the following organisations directly:
Can I make a one-off donation through payroll giving?
This will depend on whether or not your employer has set up their payroll giving programme to allow one-off donations. Although an employer may decide not to allow one-off donations through payroll giving as general rule, they may still allow one-off donations to occur for specific causes. For example, an employer may allow employees to make a one-off donation to a crisis appeal.
If your employer uses an intermediary solution for payroll giving then it may be possible to make one-off donations as and when you choose. To find out more about how these solutions work please contact the following organisations directly:
How can I claim my tax credit for donations not made through payroll giving?
If you have made financial donations outside of payroll giving to donee organisations you can claim a tax rebate by submitting a Tax credit claim form (IR526). See Inland Revenue's website for more information.
Additional Resources
Inland Revenue- View Inland Revenue guidelines for Payroll Giving
Office for the Community & Voluntary Sector- Read about the introduction of payroll giving and download resources for your workplace.Giving Case Studies