What is the New Zealand Income Tax?
New Zealand has no tax-free threshold — PAYE starts from the first dollar at 10.5% and rises through five bands to 39%. There is no separate social security tax.
All earners pay the ACC earners levy, 1.75% for the year to 31 March 2027 on earnings up to $156,641, funding accident cover. KiwiSaver is a voluntary retirement scheme. From 1 April 2026 the default employee rate and the compulsory employer contribution are both 3.5%, rising to 4% on 1 April 2028.
Formula & worked example
Net = Salary − PAYE − ACC levy − KiwiSaver − student loan
Worked example: an $85,000 salary pays about $17,928 PAYE and $1,488 ACC. With the default 3.5% KiwiSaver ($2,975), net annual pay is roughly $62,610, or about $1,204 a week — plus $2,975 of employer KiwiSaver going into your retirement account.
How to use this new zealand income tax calculator
- Enter your gross annual salary.
- Choose your KiwiSaver contribution rate — 3.5% is the default and the minimum outside a temporary rate reduction.
- Tick student loan if you have one; repayments are 12% above the threshold.
- Note that ACC is capped at a maximum earnings level.
Smart tips
- Contributing at the default 3.5% to KiwiSaver captures the compulsory 3.5% employer contribution — declining it is turning down free money.
- The government KiwiSaver contribution requires a minimum personal contribution each year; check you qualify.
- New Zealand has no capital gains tax on most long-held assets, though the bright-line test catches some property sales.
- There is no tax-free threshold, so even small side incomes are taxable from the first dollar.
- ACC levies are capped, so the effective rate falls slightly on very high salaries.
Frequently asked questions
What are New Zealand income tax rates?
10.5%, 17.5%, 30%, 33% and 39% across five progressive bands, starting from the first dollar earned.
What is the ACC earners levy?
A compulsory levy on salary and wages funding New Zealand's no-fault accident compensation scheme. For the year to 31 March 2027 it is 1.75%, charged on earnings up to $156,641.
How does KiwiSaver work?
You contribute 3.5%, 4%, 6%, 8% or 10% of pay, your employer must add at least 3.5% from 1 April 2026, and the government adds an annual contribution if you meet the minimum.
Is there a tax-free threshold in New Zealand?
No. Unlike Australia or the UK, PAYE applies from the first dollar of income.
Want the theory behind the numbers? Browse the Money Blog for worked guides.
Written by Gurjeet Singh, Sharpen Solutions. Last reviewed 15 Oct 2026. Sources: Inland Revenue NZ — tax rates for individuals, Inland Revenue NZ — ACC earners’ levy 1.75% and the maximum liable income, year to 31 Mar 2027, Inland Revenue NZ — KiwiSaver employee contribution rates, 3.5% default from 1 Apr 2026. How we check these numbers.