7 Jan 2010

Workers able to donate part of pay to charity

11:20 am on 7 January 2010

Most workers in New Zealand are now able to donate to their favourite charity directly from their pay and receive an immediate credit on their tax.

The scheme took effect on Thursday and allows eligible workers who want to donate to a charity to ask their employer to deduct money from their pay.

The worker is then taxed only on the remainder of their pay, getting an immediate tax credit, rather than waiting until the end of the financial year.

Revenue Minister Peter Dunne says the scheme will be open only to people who work for companies that file their returns electronically, which is about 70% of employers.

Mr Dunne says payroll giving in Australia has had a significant effect on donations to charity.