Evidence of Flawed Entitlement Process 

For every levy process there is a corresponding entitlement process and clearly a flawed levy process would result in a flawed entitlement process. The Corporation does not disappoint and the actions I am about to describe take the concept of flawed to entirely unprecedented levels. To fully understand the Corporation's thinking that allowed the following aberration to occur, we must always remember that the primary motivation in all the Corporation's decision making processes is to deny entitlement, lawfully or otherwise. 

Having made up its mind that it was entitled to usurp the role of the government and deny entitlement to the category of earner in question, the Corporation found itself in need of what it likes to call a "legal construct". The Corporation simply adores such constructs for they are the ones doing the constructing. However, as we know, the Corporation has applied its famous construct process to strictly interpreted law and as a result now finds itself in a very difficult position. 

ACC Invoicing Statement 

See ACC Invoice Document 

"Your invoice has been calculated based on schedular payments that were declared to Inland Revenue by your Employer. Schedular payments are treated as self-employed earnings because no levy has been deducted." 

Note that just like the unlawful documentation provided by the Inland Revenue department the invoice is silent on the salient fact that the payment in question is in fact PAYE.

 

See Flawed IRD Process 

So we can establish that both the IRD earnings documentation and the ACC invoice information mispresent the category of earnings that apply, in this case PAYE. The claimant is now unaware of the true legal classification of the earnings in question. 

We see in that invoice statement that the Corporation "does not levy" said earnings and it also says that as a result it treats what are in fact PAYE Income Payments in the current tax year as self-employed earnings that in fact have their own legal requirements under the AC Act 2001. This is very important. 

The first issue here is that there is no legislation in either the AC Act 2001 or the IT Act 2007 that allows either agency to unilaterally alter the legal status of a category of earnings. Yet openly stated on millions of invoices for all to see is the fact that the Corporation is doing just that. 

A self-employed earner has two earnings considerations in the Clause 38 entitlement clause. There are PAYE earnings received in the current tax year and the taxed and deducted for expenses earnings that present in the IRD's records for the previous financial year. This previous year is known as the "relevant year" under  the AC Act 2001. 

Relevant or Previous Financial Year

The amount that remains after the deduction of expenses from income is the claimants earnings for this financial year. 

The earnings in this year are legally described as earnings as a self-employed person. Section 14 applies. 

Current Financial / Tax year 

These earnings are PAYE Income Payments that are being paid in the current tax year. These payments are PAYE Income schedular payments and they are earned by self-employed persons who are paid in PAYE schedular payments for the purposes of the PAYE Rules. Section 221 and Schedule 4 apply.

What the Corporation has elected to do, is alter the legal status of PAYE Income received in the current tax year to self-employed earnings. This brings our attention to the wording in Section 14 of the AC Act 2001. 

14 Earnings as a self-employed person


(1) Earnings as a self-employed person, in relation to any person and any tax year,—


(a) means A minus B, A being the amount described in subsection (2) and B being the amount described in subsection (3); and


(b) does not include any earnings as an employee or earnings as a shareholder-employee.


(2) A is the amount of income (if any)—


(a) that the person derives in the tax year for the purposes of the Income Tax Act 2007; and


(b) that is dependent on the person’s personal exertions.


(3) B is all amounts that the person is allowed as deductions for the purposes of the Income Tax Act 2007 because of the person deriving the income described in subsection (2).

So the legislation is very clear. Self-employed earnings is the amount that remains after deductions. The problem here is that when the Corporation takes it upon itself to unilaterally alter the category of earnings as it has done then it is declaring non deducted for expenses PAYE Income as self-employed earnings.

 

Yet according to section 14 self-employed earnings are the result of income that has been deducted for expenses. The earnings have not been deducted because they are still sitting in the current tax year and deductions from those earnings take place at the end of the financial year which has not occurred at this point in the process. 

So it is clear that the Corporation is not only changing the earnings legal status unlawfully, they are declaring non deducted earnings in the current tax year as self-employed earnings in breach of section 14 of the AC Act 2001. All this is occurring under what is supposed to be strictly interpreted legislation. 

Having done that the Corporation then goes on to claim that: We do not levy these earnings (when they should be), we treat these earnings as self-employed earnings (having done so based on no legislation whatsoever), we cannot compensate self-employed earnings that are not earned in the relevant / previous tax year as these self-employed earnings (which we reclassified wholly unlawfully) are sitting in the current tax year. As a result you are entitled to weekly compensation at a rate of 80% of nil (which is calculation outside of the laws of accounting and mathematics). 

It gets worse. Yes it actually does. The long term injured claimant has been unlawfully denied their inalienable entitlement for weekly compensation under law. As a result they are essentially destitute not long afterwards. The financial year rolls over and those PAYE Income Payments (schedular payments), that were unlawfully altered to earnings as a self-employed person in the current tax year when the injury occurred, now appear in the system as earnings received as a self employed person in the relevant / previous tax year and the Corporation then levies the claimant unlawfully under section 222. 

Section 222 is in place for those self-employed earners who pay provisional tax in the current year and who are levied on the deducted income presented in the previous financial year. The result is that the claimant is being invoiced for earnings that the Corporation has refused to levy unlawfully at the time of payment as required by the Section 221 levy process. The claimant cannot pay so the Corporation sends a debt collector after them and ruins their credit rating. 

The stated will of the legislators here was that self-employed people would receive fair compensation on the earnings they had earned in the period in which they had earned them. Does what we see here before us look anything like the stated will of the legislators? No. No it does not.