Calculating weekly compensation for self-employed

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A navy blue background displays the white ACC logo. Text appears alongside it: He Kaupare. He Manaaki. He Whakaora. Prevention. Care. Recovery. The background wipes to a peach/pink colour. A small tag in the top right reads: self-employed. Large text appears on screen: Calculating weekly compensation for self-employed. 

Transcript 

Upbeat, gentle instrumental music plays in the background 

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A male presenter with a beard and curly hair tied in a bun, wearing a cream sweater, sits in an armchair in a modern office room with wood-panelled walls, a potted palm and couch in the background — there is an open laptop and mug on a wooden side table beside him. He speaks directly to the camera. 

Transcript 

Kia ora. In this episode, we'll show you how weekly compensation payments are calculated when you're self-employed. We'll look at three examples based on how long you've been self-employed, so you can see how it might work for you. If you haven't passed the end of a tax year yet, you're considered 'newly self-employed.' We add any PAYE earnings in the 52 weeks before injury and divide by the number of weeks you worked. 

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The screen switches to a graphic on a white background titled ‘Example 1: Newly self-employed’ with an orange dollar sign icon below it. The calculation appears line by line on the right: 

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Here's an example. Say you earned $23,400 over 18 weeks. That gives you an average of $1,300 per week. ACC pays 80%, which is $1,040. But after tax and deductions, your payment might be around $800. There are two things to note here. 

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The graphic changes. The calculation disappears and is replaced by text on the right: 

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Self-employed earnings aren't included because you haven't filed a tax return yet. If you had no PAYE earnings in the 52 weeks before your injury and you don't qualify for the full-time minimum rate, your weekly compensation payment may be zero dollars. 

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The video cuts back to the full shot of the presenter in the office. 

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If you've passed one tax year end, we call this 'recently self-employed'. We use declared earnings from the last tax year plus any PAYE earnings in the 52 weeks before your injury. Then, we divide by the number of weeks worked. 

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The screen switches to a graphic on a white background titled: Example 2: Recently self-employed, shown on the left, with an orange dollar sign icon below it. The calculation appears line by line on the right: 

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For example, you earn $40,000 of self-employed earnings over 26 weeks and $12,500 of PAYE employee earnings over nine weeks. These added together give you $52,500. And then we divide this by the 35 weeks you worked. ACC will pay 80%, which is $1,200. And after tax and deductions, your payment might be around $900. 

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The video cuts back to the full shot of the presenter in the office. 

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Our final example is when you've passed two or more tax year ends. We call this 'established self-employed'. We use the same calculation as a recently self-employed person, but divide by 52, regardless of how many weeks you worked. 

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The screen switches to a graphic on a white background titled: ‘Example 3: Established self-employed, shown on the left, with an orange dollar sign icon below it. The calculation appears line by line on the right: 

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In this example, imagine you earned $35,000 of self-employed earnings and $30,000 PAYE employee earnings, which add up to $65,000. We divide by 52 to give you your average weekly earnings. ACC pays 80%, which is $1,000, and after tax and deductions, your payment might be around $790. 

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The video cuts back to the full shot of the presenter in the office. 

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These examples are for guidance only and don't apply if you have a CoverPlus Extra policy. Actual payments depend on your situation. If you haven't filed your tax return, we may approve temporary payments based on estimates. Once you file, we'll reassess and adjust for any overpayment or underpayment. Here's the key thing to remember. 

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The screen splits again. The presenter is on the right. The left side displays a large orange icon with an exclamation mark in a circle, with the text: Important. Receiving other income? Let us know. 

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It's important to tell us if you keep working or your business earns income while receiving weekly compensation. We'll need to adjust your payments to reduce the risk of an overpayment. 

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The video cuts back to the full shot of the presenter in the office. 

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Log any hours worked in MyACC or by calling us. Contact us if you're unsure. We're here to help. Here’s a summary of what we’ve covered. 

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The screen switches to a graphic on a white background. On the left, the heading ‘key takeaways’ appears above an orange pencil icon. On the right, a numbered list appears, line by line: 

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The video cuts back to the presenter in the office for the closing statement. 

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In the next episode, we'll explain how weekly compensation works when you return to work. To learn more, visit our website. Hoki mai anō. 

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The screen returns to the navy blue background with the ACC logo in the top left. Large text in the centre reads: Use MyACC to apply for weekly compensation and manage your claim. Contact details appear at the bottom of the screen, in the following order: website www.acc.co.nz, email address claims@acc.co.nz, and the free call phone number 0800 101 996. 

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The upbeat, gentle instrumental music fades out.