Rotorua woman Michelle Hoffman-Tamm was killed by her lover in a frenzied attack that saw her stabbed 33 times, had teeth knocked out and ears cut off.

Rotorua process worker Gwenda Sloane, 44, today pleaded guilty to murdering Michelle Hoffman-Tamm on November 8 in a fight over $20.

Rotorua woman Michelle Hoffman-Tamm was found dead near Murupara.

She is remanded in custody until sentencing on February 4.

According to the police summary of facts the two had known each other for more than 20 years but the friendship had intensified into a sexual relationship in the last year.

On the night of her murder Michelle Hoffman-Tamm left the Philip Street home she shared with her long term female partner to visit a friend, but never arrived.

She received a text from Sloane, and instead visited Sloane's house where they drank beer and had sex.

At some point during the evening Sloane attacked Michelle stabbing her multiple times in the chest and back, cutting off both her ears and putting one in Michelle's mouth.

Police believe most of the stab wounds were after Michelle had died including a cut across the throat and a cut from her mouth across her face. The ears were severed after death.

Michelle's body lay on the kitchen floor at Sloane's house for more than a day.

On November 9, Sloane wrapped the body in plastic bags using duct tape she had also bought, and drove towards Whakatane looking for somewhere to dispose of it.

She buried the body 120km away in a 1.5m deep ditch near Murupara covering it in rubbish and dirt.

On her return home she hired a domestic carpet cleaning machine to clean up the house.

Sloane was spoken to three times by police during their investigation into Michelle's disappearance, but she offered no help.

When police returned on November 22, Sloane confessed and led police to the body. Police say they wouldn't have found it, without her help.

Sloane told police she recalled only parts of what happened but remembered attacking Michelle, and punching her and stabbing her.