First up: taking a holiday from KiwiSaver if you're getting paid wages.
Anyone who is working and is also a member of KiwiSaver will have their contributions taken out of their pay before it hits their bank account.
But one of the features of KiwiSaver is you can take a holiday from contributions.
I talked to the IRD about this and it says "if a member is receiving salary and wages and wishes to take a break from deductions they need to apply for a contributions holiday from Inland Revenue".
The reason the IRD needs to be kept in the loop is that KiwiSaver is deducted at the same time as Paye, student loan repayments, child maintenance and the like, and forwarded through to the IRD by your employer each month.
The IRD checks all the payments and sends on your KiwiSaver contributions through to your provider. It can take up to three months for this to happen but the IRD pays a small amount of interest - currently 1.57 per cent - on your money while it holds it.
IRD has an online service called My KiwiSaver that allows you to check contributions made by you, your employer and the Government. It also allows you to apply online for a contributions holiday.
The other way is to fill out a contributions holiday request (KS6) or by calling the IRD.
Generally speaking you need to have been in KiwiSaver for 12 months before you can take a contributions holiday, but in cases of financial hardship the IRD will consider applications before the 12 months is up.
You can take a contributions holiday of between three months and five years, and can renew your holiday at any time with no limit to the number of renewals you make.
If your circumstances change it is also possible to restart making contributions from your pay while on holiday, in which case your employer will also need to restart making its contributions too.
Remember that while you're on a contributions holiday your employer also won't be making any contributions to your KiwiSaver.
You can make voluntary contributions while on a contributions holiday. These won't be matched by your employer but will entitle you to some or all of the member tax credit, depending on how much you contribute.
To make a voluntary contribution you pay the IRD or your KiwiSaver provider directly.
The situation for those who, like you, are self-employed is slightly different.
"If a member no longer receives salary and wages there is no longer income from which a deduction is made so they do not need to apply to Inland Revenue for a contributions holiday and they will need to discuss with their scheme provider instead," says the IRD.
Anyone who is not working, on a benefit or self-employed isn't required to make any compulsory contributions to KiwiSaver through the IRD, but instead make payments directly to their provider.
In this situation the IRD doesn't need to be told of your plans to take a break from KiwiSaver.
If you do want to make KiwiSaver payments then depending on your provider there is a degree of flexibility - anything from a lump sum through to regular weekly payments.
Like those who are employed or on a contributions holiday you should aim to top up your account with $1043 - around $20 a week - to get the full $522 member tax credit every year.
Which KiwiSaver fund is right for you? Check out our KiwiSaver Fund finder
Disclaimer: Information provided is stated accurately to the best of the respondent's knowledge at the time of publication. It is general in nature and should not be construed, or relied on, as a recommendation to invest in a particular financial product or class of financial product. Readers should seek independent financial advice specific to their situation before making an investment decision.
Question
To have your KiwiSaver questions answered by the NZ Herald's panel of industry players email Helen Twose, helentwose@gmail.com. Sorry, but Helen cannot answer all questions, correspond directly with readers, or give financial advice.
