Employers have to know and hold considerable amounts of personal information about their employees (such as whether their employee has a student loan, or is liable for child support) to deduct the right amount of income tax and other Inland Revenue deductions from their pay.

Mika runs a fishing and outdoor supplies shop, and employs Roger as his assistant.
Roger is liable for child support for a child he had with his previous partner. Mika already deducts child support from Roger’s pay, as per Inland Revenue’s instructions.
Roger’s new partner has just given birth, and Inland Revenue has sent Mika a letter with instructions to deduct a new amount from Roger’s pay.
Mika now has to make sure he deducts the new amount correctly from Roger’s next pay, update his payroll system, and make sure his employer monthly schedule (IR348) reflects the new amount.
 

Employers will no longer need to know their employees’ personal liabilities and circumstances (such as child support and student loan liabilities), because their payroll and accounting software will be integrated with and populated by Inland Revenue’s systems.
Employers will only need to enter information about their employees’ gross wages, and their software will calculate the deductions without the employer knowing what the deductions are for.
Employees will now manage any changes in their personal circumstances themselves, in their own personalised and secure area in the Inland Revenue website.
 

Mika runs a fishing and outdoor supplies shop, and employs Roger as his assistant.
Roger is liable for child support for a child he had with his previous partner.
Roger’s new partner has just had a child. Roger logs on to his personalised, secure area in the Inland Revenue website and updates his information. Roger receives immediate confirmation from Inland Revenue in his secure area that his personal circumstances have been updated and that this new information has been filtered through to his employer’s payroll and accounting software.
At Roger’s next pay-day, his new pay will reflect the change to his personal circumstances.
Mika’s payroll and accounting software is integrated with Inland Revenue’s systems and calculates Roger’s new deductions automatically. Mika does not need to know about Roger’s child support liabilities or any other details about his personal circumstances.