(the figures quoted below are for the 2010/2011 year)
When you’re working for yourself and you have an accident, there’s no such thing as a paid day off. When a self-employed person is injured they just carry on the best they can.
But what happens if you can’t carry on?Will ACC cover you; will it be enough to employ someone else?Does your annual business income vary? For example farmers incomes are up one year and down the next.What if you’re newly self-employed or only work part time?
You are automatically covered by ACC CoverPlus, but what do you get?
ACC CoverPlus is the standard cover, with levies and weekly compensation based on the previous year’s earnings.• You are eligible for compensation of up to 80% of your previous year’s earnings.• If you are newly self-employed your weekly compensation will be based on the net income of the last four weeks, the minimum being $384 per week. If you work less than 30 hours per week you will need to prove your work history. But how long will it take to get the information collated when you need compensation now? • Your compensation may be reduced if your business continues to generate income or if you are able to work part-time.
Will this be enough, and what else is there?ACC CoverPlus Extra is the alternative to the standard ACC CoverPlus but you will need to apply.
ACC COVERPLUS EXTRA
• You choose a guaranteed level of weekly compensation.• You will get your compensation faster if you are unable to work, as the weekly compensation has already been negotiated.• Proof of income is not required at the time of injury. You will receive 100% of the negotiated weekly compensation. This also applies to the newly self- employed and to part-timers.• The minimum level of annual compensation that you can nominate is $26,000 and the maximum is $88,015 each year.• There is also a “Lower Level of Weekly Compensation” option whereby you pay a lower levy based on the hours that you are able to work.• Partnerships are able to negotiate the working partners income based on the partnerships liable earnings and a concession for one “passive earner”.TO CONCLUDE
• You are automatically covered by ACC CoverPlus but it may not be enough and you may not receive it when you need it the most.• ACC CoverPlus Extra gives you more flexibility and certainty of payment because you have negotiated the weekly compensation in advance.• ACC CoverPlus Extra costs about the same as ACC CoverPlus and you can apply at any time even if you have already paid your levy.
Although local PKF offices specialise in business advisory services the information in this article is a summary only and should not be relied on alone. It is recommended that you obtain your own expert advice when considering whether or not to change to ACC CoverPlus Extra.