Since the early 1900s, New Zealand has established a comprehensive framework for accident compensation, often heralded as world-leading and revolutionary. Whether you love it or loathe it, most New Zealanders contribute to ACC levies in some form. For business owners and the self-employed, a brief review of your ACC policies and settings could be highly beneficial.

In the past, many have found ACC invoices challenging to interpret, with multiple account types covering various financial periods arriving simultaneously. Deciphering what cover is in place and the exact amount payable can be complex. However, ACC has made strides in recent years to enhance the clarity of their invoices. Nonetheless, it remains crucial to ensure all information fields are accurate.

Guidelines for Reviewing ACC Invoices:

  1. Identify the ACC Account Type: Determine whether your invoice is based on self-employed earnings, the shareholder account for your company’s non-PAYE (shareholder) salaries, or your employer account, which is derived from gross wages information from the PAYE returns filed for your business.
  2. Verify Liable Earnings Figures: Ensure that the ACC liable earnings figures align with the income tax or PAYE returns previously filed with the Inland Revenue.
  3. Check Working Status: Confirm whether your working status is recorded as full-time (over 30 hours per week) or part-time. Full-time earners have a minimum annual liable earnings value ($44,250 for the year ending 31 March 2025), while part-time earners are billed based on their actual liable earnings.
  4. Review Maximum Earnings Cap: For those earning above the full-time maximum ($142,283 for the year ending 31 March 2025), ensure you have not been levied beyond this point, especially if you have multiple income streams.
  5. Assess the Business Classification: Verify that your business industry is correctly recorded. While straightforward for many businesses, some classifications can be ambiguous. Levy rates vary significantly across industries, making this an important area to check. If in doubt, consult www.businessdescription.co.nz or contact ACC for the best classification unit for your business.
  6. Consider Multiple CU Costs: If your entity encompasses multiple business activities, there might be opportunities for savings through multiple Classification Unit (CU) codes. This can be complex, so consult your Sidekick advisor to explore potential savings.

ACC offers an optional product, ACC CoverPlus Extra, which functions like an agreed-value insurance policy. This is particularly beneficial if your earnings fluctuate (think seasonal worker) or if you’re new to business without an established earnings history. ACC CoverPlus Extra can provide greater peace of mind regarding your level of cover and offer more certainty around levy costs.

Certain situations affecting your work capacity, such as illness or degenerative conditions, fall outside ACC’s scope. To address this, consider additional cover from a private insurer. Ensure your insurer fully considers your ACC policy settings to ensure comprehensiveness and avoid overlapping cover. It is sometimes possible to adjust ACC cover via ACC CoverPlus Extra to complement your private insurance policies. It’s important to seek advice before modifying your ACC cover level to prevent unintended negative outcomes.

At Sidekick, we can link your ACC account to our agency, enabling us to monitor and review ACC invoices and policy settings regularly. Please contact us if you would like a more in-depth explanation of any ACC topics mentioned and how they may apply to your situation. Given the compulsory nature of ACC for many, it’s worthwhile to ensure your details are correct and that your policies are optimised to best meet your needs.