New Zealand Income Tax & KiwiSaver Calculator

No. Unlike the UK (£12,570 personal allowance) or Australia's $18,200 tax-free threshold, New Zealand has no personal tax-free allowance. Your very first dollar of income is subject to PAYE at 10.5%. The tax system is designed to be simple and universal. Low earners can partially offset their tax liability through the Independent Earner Tax Credit (IETC) — worth up to $520/year for earners between $24,000 and $70,000 who are not on Working for Families or government benefits.

The Independent Earner Tax Credit (IETC) is a flat non-refundable credit of up to $520/year for middle earners ($24k–$70k) who are not on Working for Families or income-tested benefits. Working for Families (WfF) is a broader suite of tax credits — Family Tax Credit, In-Work Tax Credit, Minimum Family Tax Credit — targeted at families with dependent children. You cannot claim both IETC and WfF in the same period. If you have children and qualify for WfF, it is typically more beneficial. Use tax code M (without the ME suffix) if you are not claiming IETC.

Yes, but with restrictions. Newly enrolled employees have a limited window (initially 56 days after their first payday) to opt out by completing an opt-out notice (KS10) and submitting it to Inland Revenue. After this window, you can apply for a contributions holiday of 3 months to 1 year by completing form KS6 and submitting it to IRD. Note that if you opt out, you also forfeit the compulsory employer contribution of ≥3% and the Government's annual member tax credit (up to $521.43/year for those contributing at least $1,042.86). These can be significant long-term benefits.

If you are a New Zealand-based borrower, student loan deductions begin automatically from your first paycheck. For the 2025/2026 year, the annual repayment threshold is $24,128 ($464/week). You repay 12% of every dollar earned above this threshold. For example, on $60,000 gross, you would repay: ($60,000 - $24,128) × 12% = $4,304.64/year or $330.36/month. Use the 'SL' suffix on your tax code (e.g., M SL or ME SL) so your employer deducts it automatically alongside your PAYE.

New Zealand's 39% top marginal rate applies only to income above $180,000 per year. It was introduced by the Labour Government and became effective from 1 April 2021 under the Taxation (Income Tax Rate and Other Amendments) Act 2020. Critically, it's a marginal rate — only the portion of your income above $180,000 is taxed at 39%. The first $180,000 continues to be taxed at the lower progressive brackets. For example, on $200,000 income, only $20,000 is taxed at 39% ($7,800 additional tax). New Zealand does not currently have a capital gains tax, meaning investment returns from property and shares are generally not subject to this rate.

The ACC Earner's Levy is a mandatory statutory deduction collected by your employer on behalf of the Accident Compensation Corporation (ACC). It funds New Zealand's universal personal injury insurance scheme, which covers medical costs and income replacement for injuries caused by accidents (including non-work accidents like sports injuries). For 2025/2026, the rate is 1.67% on liable earnings up to $152,790. You cannot opt out — it is legally compulsory for all employees. However, there is a liable earnings cap: if you earn more than $152,790, you pay a maximum levy of $2,551.59 regardless of your actual earnings above that threshold.

If you have a second job or secondary income source in New Zealand, you must use a secondary tax code (not your main code). The appropriate secondary tax code depends on your estimated annual income from the secondary source: SB (earnings $0–$15,600), S ($15,601–$53,500), SH ($53,501–$78,100), ST ($78,101–$180,000), or SA (over $180,000). These codes ensure the correct marginal rate is applied without a personal allowance being double-claimed. You can also use the ird.govt.nz tax code estimator to find your optimal secondary code. At year-end, IRD will issue a Personal Tax Summary to confirm your total tax paid versus your actual liability.

No. New Zealand's Goods and Services Tax (GST) at 15% applies to the supply of goods and services, not to employee wages or salary payments. Employee wages are entirely outside the GST regime. However, employers must pay Fringe Benefit Tax (FBT) on certain non-cash benefits provided to employees (e.g., private use of company vehicles, subsidised loans, discounted goods). FBT is the employer's cost, not deducted from employee wages. For standard salary earners, the only payroll deductions from gross wages are PAYE income tax, ACC Earner's Levy, KiwiSaver contributions, and student loan repayments.