Onboarding a New Employee in PNG: A Step-by-Step Guide

Hiring your first employee in Papua New Guinea — or your fiftieth — involves more compliance steps than most SME owners realise. Skipping any of them creates problems later: missed Nasfund contributions, IRC withholding errors, and the most painful one of all, a surprise audit finding at year-end. Here is the full sequence we walk new TBA clients through.

Before they start

1. Make sure they have a NASFund member number

Every PNG worker should have a unique NASFund member number. If your new hire already has one (most workers who've had a previous job do), get it from them on day one. If they don't, you need to register them. Nasfund's online portal accepts new-member registrations and issues a number within a few days.

2. Have them complete Form S1 (Salary or Wages Tax Declaration)

This is the IRC declaration form that tells you whether to apply Table A (resident, declared) or Table B (resident, undeclared) when withholding tax. Form S1 also captures whether they're claiming dependants — which affects their fortnightly tax via the dependant rebate.

Keep the signed original on file. The IRC can demand to see it during an audit and "the employee said they had two dependants" without paperwork won't save you from a back-tax assessment.

3. Collect banking details

For most PNG employers this means a BSP, Kina, Westpac or ANZ account number plus the branch code. TeebeePay also supports splitting one employee's pay across multiple accounts (e.g. K500 to a savings account and the rest to the main account) by percentage — handy for employees who want to enforce their own savings discipline.

Setting them up in payroll

4. Decide salary vs hourly

Salaried employees are paid the same amount every fortnight regardless of hours, with the annual figure divided by 26. Hourly employees are paid for actual hours worked, with overtime kicking in above 80 hours per fortnight at 1.5× the base rate (the legal minimum overtime multiplier in PNG).

5. Set the default hours per period

Full-time PNG employees normally have an "assigned full-time hours per fortnight" of 80. Part-timers might be 40 or 60. This default is what TeebeePay's hours grid pre-fills each fortnight — saves typing 80 for everyone, every payday. You override only when someone worked fewer hours.

6. Configure standing allowances and deductions

Standing items recur every payroll unless you remove them:

• Allowances (added to gross, taxable): housing, vehicle, fuel, meals, school fees, leave fares, electricity, gas, phone, airfares.
• Pre-tax deductions: salary sacrifice into super, voluntary Nasfund top-up.
• Post-tax deductions: savings plan, education fund, Christmas savings, loan repayment.

The pay stub shows each one as a line item so the employee can see exactly what's coming out and going where.

First fortnight

7. Run the first pay period

On the new employee's first fortnight, the system computes:

1. Base pay = (annual salary ÷ 26) or (hours × hourly rate)
2. Plus allowances (taxable)
3. Less salary sacrifice and voluntary Nasfund (pre-tax)
4. Less 6% mandatory Nasfund (pre-tax)
5. SWT calculated on the remainder using Tables A/B/C as appropriate, less dependant rebate
6. Less standing post-tax deductions
7. Less any cash advance you've entered for this period
8. = Net pay, deposited to their bank accounts per their split percentages

8. Confirm the stub looks right

Always eyeball the first pay stub for a new employee before approving the run. Common things to catch: wrong residency status (drove tax 3× higher), missing bank account number (the BSP batch will reject the row), or a typo'd dependants count.

9. Make sure they get their stub

TeebeePay emails the stub the moment the payroll is approved. If they don't have an email address, the stub is also stored against the period in the archive — you can print and hand it over. We strongly recommend collecting email addresses for everyone, even if you have to set up a Gmail account with them on day one. It's free, it's instant, and it eliminates "I never got my pay slip" entirely.

Month-end and beyond

10. NASFund return includes them automatically

From the first pay period onwards, the monthly Nasfund return that goes to the fund includes the new employee with their member number, date of birth, gross, and both contribution amounts. No extra paperwork.

11. SWT remittance to IRC

The tax withheld each fortnight is remitted to the IRC monthly. By the 7th of the following month, your total SWT for the month is summarised and paid via bank deposit referenced with your TIN. TeebeePay generates the summary PDF for you each month-end.

12. End-of-year reconciliation

By 14 January each year, every employee must receive a Statement of Earnings showing their full-year gross, tax withheld, and Nasfund contributions. By 14 February, all those statements plus a reconciliation return go to the IRC. TeebeePay produces both from the year's data — one click, signed by your AP, sent.

The shortcut

If steps 1 through 12 made you think "this is exactly the kind of thing I keep meaning to nail down but never actually do" — that's why TeebeePay exists. Bring us a CSV of your team and we'll have them all set up with member numbers verified, S1 forms on file, and a first sample fortnight ready for you to review before next payday. The first fortnight is free.