2020 Law changes round-up
From tax changes and parental leave, new vaping rules to marketing during the America’s Cup, check out this summary of 2020's new laws. A lot has changed this year, so make sure you know the new rules that apply to your business.
When: From 1 July 2020
What: Government-funded parental leave payments extended from 22 weeks to 26 weeks.
Unpaid parental leave, during which someone’s job is protected, has also increased. Parental leave depends on how long the person has worked for you before the baby’s due date, or the date they take over the care of a child:
- 26 weeks parental leave for people who worked an average of 10+ hours a week for six months or more.
- 52 weeks parental leave for people who worked an average of 10+ hours a week for 12 months or more.
Parental leave, including COVID-19 temporary changes(external link) — Employment NZ The “keeping in touch” allowance has also gone up. Employees can now work up to 64 hours during their 26 weeks of parental leave payments, without losing eligibility for these government payments.
Keeping in touch days(external link) — Employment NZ
Why: To provide increased support for primary carers, including working parents with new babies and families taking on the permanent care of children under the age of six.
What you need to do: Make sure eligible employees can:
- Take at least the legal minimum amount of unpaid parental leave, depending on how long they have worked for you.
- Arrange to work up to 64 hours during their 26 weeks of paid parental leave if both you and your employee want to take this option. Remember, you pay them for hours worked, the government covers parental leave payments.
It’s a good idea to check and update your employment processes or policies. Then everyone knows what’s available and how to apply.
Paid parental leave is changing - (external Link).
Privacy and personal information
When: From 1 December 2020
What: Changes to the Privacy Act mean businesses must:
- not destroy personal information if someone asks for information held about them
- report serious privacy breaches
- check personal information disclosed with overseas companies will have similar protection to New Zealand.
The revamped Act gives the Privacy Commissioner greater powers. This includes:
- ordering a business to give a person their personal information
- issuing a compliance notice if a business fails to comply with the Privacy Act.
Why: The Privacy Act aims to keep personal information safe and secure. The law updates reflect changes in technology and the ways business is done online and offline.
What you need to do: If someone asks for their personal information held by your business, you must respond within 20 working days.
If there’s a serious privacy breach in your business, you must report it to the Office of the Privacy Commissioner.
You can only disclose personal information to an overseas company if its country has similar protections to our Privacy Act. This does not apply to overseas cloud-based services.
Decide who in your business will take the lead on privacy matters. This could be you, an office manager, or another trusted worker. This person will be your privacy officer.
Privacy Act 2020(external link) — Office of the Privacy Commissioner
Privacy Act overhaul to protect personal information in digital age
COVID-19 tax relief
When: Start dates vary, ranging from 25 March 2020 to 12 May 2020.
What: Tax relief measures to help businesses and sole traders financially impacted by the COVID-19 pandemic, including:
- Tax loss carry-back scheme. Businesses expecting to make a loss in the 2019/20 or 2020/21 tax years can offset that loss against profits made the year before.
- Small business cashflow (loan) scheme for small businesses, sole traders and contractors.
Why: Part of the government’s COVID-19 support package for businesses and sole traders.
What you need to do: This depends on the type(s) of tax relief. Start by checking what’s available to your business and situation:
- Extended deadlines to pay tax: Contact Inland Revenue as soon as possible. You must still file your tax return on time.
COVID-19: Manage my tax(external link) — Inland Revenue
- Loss carry-back: You must tell IR you plan to use this scheme. Do this online via myIR, using the “I want to” section.
Temporary loss carry-back scheme(external link) — Inland Revenue
- Reduced interest charged on unpaid tax (called “use of money” interest) down from 8.35% to 7.00%.
Interest on overpayments and underpayments(external link) — Inland Revenue
Tax, including KiwiSaver and student loans
When: From 1 April 2020
What: Changes include:
- Payday filing requirements so Inland Revenue can forward monthly KiwiSaver deductions to each employee’s KiwiSaver provider.
- For employees with student loan payments deducted from their pay, Inland Revenue can notify the employer when the loan is almost paid off.
Other law changes include how to value shares given to employees. For more information, check the Inland Revenue website or talk with your tax agent.
Why: To continue simplifying and modernising the tax system.
What you need to do: If you use Inland Revenue’s online payday filing system (ir-File), you likely already do what’s required.
For all employers, it’s a good idea to check the requirements. These include:
- filing an employment information form every time you pay your employees
- adding the pay day and pay period worked on these forms.
Inland Revenue uses this information for your employees’ KiwiSaver contributions and student loan records.
Research and development (R&D) tax credits
When: From 23 March 2020
What: Making R&D tax credits more widely available, starting from the 2019/20 tax year (originally planned to start in the 2020/21 tax year). As well as the new start date, there’s a new refund cap based on your business's employee-related tax, eg PAYE and ESCT (Employer Superannuation Contributor Tax).
Research and development changes(external link) — Inland Revenue
Why: To encourage businesses to spend money on research and development activities. Technological and scientific advances help boost New Zealand’s economic performance.
What you need to do: To apply for the R&D tax incentive in the 2019/20 or 2020/21 tax years, register online via myIR. You only need to do this once, not each year.
If you receive the R&D tax incentive, you need to fill out an extra tax return. The R&D supplementary return must be filed within 30 days of the due date for your income tax return.
Register for R&D tax incentive(external link) — Inland Revenue
If your business involves innovation and you don’t already claim R&D tax credits, it’s a good idea to check if you qualify. Tax credits are for businesses, including start-ups, that develop new thinking, products or services related to technology or science.
Research and development(external link) — Inland Revenue
Tenancy rules for landlords, property owners and managers
Healthy homes compliance statements
When: From 1 December 2020
What: A healthy homes standards compliance statement must be included in most new or renewed tenancy agreements.
Why: This statement provides information about a rental property’s current level of compliance with the five healthy homes standards. It helps tenants to see if their landlord is working towards meeting the new standards. Most new or renewed tenancies from 1 July 2021 will need to comply with the standards within 90 days of the start of the tenancy.
What you need to do: For most new or renewed tenancy agreements from 1 December 2020, you will need to include a statement about your property's current level of compliance with the standards.
For details of what’s required when, and to download a compliance statement template, see the Tenancy Services website:
Limits on rent increases
When: From 12 August 2020
What: Rent increases are limited to once every 12 months. Previously it was once every 180 days (six months).
Why: To provide tenants with greater medium-term certainty of their housing costs and more time to prepare for any increase in rent.
What you need to do: Before you give notice to your tenant to increase rent, you will need to check when you can legally increase it. You can only increase the rent 12 months after the date of the beginning of the tenancy or 12 months after the date the last increase took effect. You must also give at least 60 days’ written notice to the tenant.
Rent increases and deductions(external link) — Tenancy Services
Vaping added to smokefree laws
When: From 11 November 2020
What: Vaping and vaping products (also called e-cigarettes) now have many of the same rules as smoking and tobacco products.
- No sales or supply of vaping products to people aged under 18.
- No vaping in indoor workplaces.
- Vaping only allowed in open areas of restaurants, bars, pubs and casinos.
- No vaping on planes, buses, trains, ferries, taxis and ride-share services.
- No vaping anywhere in or around early childhood centres and schools.
- Most advertising and sponsorship banned.
- Import restrictions.
Why: To limit the marketing, sales and use of vaping products to:
- protect the health of non-smokers, especially young people
- ensure vaping remains an option for smokers who want to cut down or switch to lower-risk nicotine products.
What you need to do: Most businesses must take reasonable steps to make sure no one vapes indoors at any time. This includes your workers, customers, suppliers and others who visit your premises.
In work vehicles, vaping is only allowed if:
- the public doesn’t usually have access to your work vehicles
- all workers who use the vehicles agree to it in writing.
In restaurants, cafés, bars and pubs, take reasonable steps to make sure people only vape in open areas. If you run an early childhood centre, no one can vape indoors or in outdoor areas, eg playgrounds, sandpits.
Vaping information for business and employers(external link) — Ministry of Health
If your business sells vaping products, make sure you:
- only sell to people aged 18+
- check and act on the new rules for advertising vaping products
- know what you can and cannot say to customers about vaping.
Vaping information for all industry(external link) — Ministry of Health
Check your house rules. Does everyone know what’s OK and not OK with smoking or vaping at work?
Use our online tool to create your own smokefree policy.
Smokefree at work(external link) — Workplace Policy Builder
Promotion rules for America’s Cup and Rugby World Cup
When: For the 36th America’s Cup, protection rules run from 8 September 2020 to 20 April 2021. For 2021 Rugby World Cup, protection rules run from 18 May 2021 to 16 October 2021.
What: Businesses that are not official event sponsors cannot claim to be associated with these major events in any way or for any reason, including promoting products or services. This includes a ban on using protected words and emblems.
Unless you get permission from the event organisers, you must not:
- use protected words or emblems
- use these major events to promote your business, products or services.
Protected emblems: America’s Cup(external link) — Legislation.govt.nz
Protected words: America’s Cup(external link) — Legislation.govt.nz
Protected emblems: Rugby World Cup(external link) — Legislation.govt.nz
Protected words: Rugby World Cup(external link) — Legislation.govt.nz
What you need to do: Many businesses will be excited about New Zealand hosting the America’s Cup and Rugby World Cup. But it’s important to know what you can and can’t do to attract customers and promote your business. Both events are protected against unauthorised association and ambush marketing.
For example, a bar can advertise it will televise a live America’s Cup race. But the bar cannot make false claims like “the official bar to watch the America’s Cup” or use a protected event logo.
Don’t use protected event words or emblems, eg logos or slogans. For example, a sightseeing company cannot use the event logo on its minivans or adverts. Nor can it set up a website with protected event words in the domain name.
Don’t name your product, service or business after the event. For example, a café cannot print a slogan like “America’s Cup of delicious coffee” on takeaway cups.
Don’t claim a link to the event. For example, a craft brewery cannot say it makes the event’s “unofficial IPA”.
Don’t try ambush marketing at major events. For example, a group of spectators at a major event cannot all hold up advertising placards.
Got questions or concerns about your marketing around the America’s Cup or Rugby World Cup?
For further details and examples of what is and is not allowed for events declared under MEMA, please see the PDF guide on this page:
Guide to the Major Events Management Act(external link) — New Zealand Major Events
Changes to Overseas Investment Act
When: From 16 June 2020
What: New checks and balances on overseas investors who fund or buy New Zealand businesses, property, and other assets. For lower risk investments, the process is now simpler. For high risk or sensitive investments, a new national interest assessment may be required.
Why: Overseas investment can help New Zealand businesses recover from the COVID-19 pandemic. These law changes help protect our national security, economy, communities, and taonga.
What you need to do: If your business seeks overseas buyers or investors, talk with your business advisor, eg accountant or lawyer. Ask if you need to tell the Overseas Investment Office (OIO). Mostly this will be if overseas investors will either:
- own more than 25% of your New Zealand business
- own more than 25% of its assets
- increase their existing ownership above 50%, 70% or up to 100% of your business.
In some cases, a national interest assessment is needed, eg selling property to a foreign government investor or selling assets used for strategically important business.