[Schedule 7  1    Priority of payments to preferential creditors 

(1)     The liquidator must first pay, in the order of priority in which they are listed,—

(a)      the fees and expenses properly incurred by the liquidator in carrying out the duties and exercising the powers of the liquidator, and the remuneration of the liquidator; and

(b)     the fees and expenses properly incurred by the administrator in carrying out the duties and exercising the powers of the administrator and the remuneration of the administrator; and

(c)      the reasonable costs of a person who applied to the Court for an order that the company be put into liquidation, including the reasonable costs incurred between lawyer and client in procuring the order; and

(d)      the actual out-of-pocket expenses necessarily incurred by a liquidation committee; and

(e)      to any creditor who protects, preserves the value of, or recovers assets of the company for the benefit of the company's creditors by the payment of money or the giving of an indemnity,—

                   (i)      the amount received by the liquidator by the realisation of those assets, up to the value of that creditor's unsecured debt; and

                   (ii)     the amount of the costs incurred by that creditor in protecting, preserving the value of, or recovering those assets.

(2)     After paying the claims referred to in subclause (1), the liquidator must next pay, to the extent that they remain unpaid, the following claims:

(a)      subject to clause 3(1), all wages or salary of any employee, whether or not earned wholly or in part by way of commission, and whether payable for time or for piece work, in respect of services provided to the company during the 4 months before the commencement of the liquidation:

         [(aa)   subject to clause 3(1), all untransferred amounts of an employee's payroll donations by an employer or PAYE intermediary under section 24Q of the Tax Administration Act 1994 during the 4 months before the commencement of the liquidation:]

(b)      subject to clause 3(1), any holiday pay payable to an employee on the termination of his or her employment before, or because of, the commencement of the liquidation:

(c)      subject to clause 3(1), any compensation for redundancy owed to an employee that accrues before, or because of, the commencement of the liquidation:

(d)      subject to clause 3(1), amounts deducted by the company from the wages or salary of an employee in order to satisfy obligations of the employee (including amounts payable to the Commissioner of Inland Revenue in accordance with section 163(1) of the Child Support Act 1991 and section 167(2) of the Tax Administration Act 1994 as applied by [section 70 of the Student Loan Scheme Act 2011]):

(e)      subject to clause 3(1), any reimbursement or payment provided for, or ordered by, the Employment Relations Authority, the Employment Court, or the Court of Appeal under section 123(1)(b) or section 128 of the Employment Relations Act 2000, to the extent that the reimbursement or payment does not relate to any matter set out in section 123(1)(c) of the Employment Relations Act 2000, in respect of wages or other money or remuneration lost during the 4 months before the commencement of the liquidation:

(f)       amounts that are preferential claims under section 263(2):

(g)      all amounts payable to the Commissioner of Inland Revenue in accordance with section 167(2) of the Tax Administration Act 1994 as applied by section 67 of the KiwiSaver Act 2006:

(h)      all sums that, by any other enactment, are required to be paid in accordance with the priority established by this subclause.

(3)     After paying the claims referred to in subclause (2), the liquidator must next pay all sums, for which a buyer is a creditor in the liquidation of the company under section 11 of the Layby Sales Act 1971,—

(a)      paid by the buyer to a seller on account of the purchase price of goods; or

(b)      to which the buyer is or becomes entitled to receive from a seller under section 9 of the Layby Sales Act 1971.

(4)     After paying the claims referred to in subclause (3), the liquidator must next pay the amount of any costs referred to in section 234(c).

(5)     After paying the claims referred to in subclause (4), the liquidator must next pay, to the extent that it remains unpaid to the Commissioner of Inland Revenue or to the Collector of Customs, as the case may require, the amount of—

(a)      tax payable by the company in the manner required by Part 3 of the Goods and Services Tax Act 1985; and

(b)      tax deductions made by the company under the PAYE rules of the [Income Tax Act 2007]; and

(c)      non-resident withholding tax deducted by the company under the NRWT rules of the [Income Tax Act 2007]; and

(d)      resident withholding tax deducted by the company under the RWT rules of the [Income Tax Act 2007]; and

(e)      duty payable within the meaning of section 2(1) of the Customs and Excise Act 1996.