Frequently asked questions

PAYE (Pay As You Earn) is the income tax your employer deducts from every pay and passes to Inland Revenue for you, so you don’t settle it all at once. Income is taxed progressively — each band at its own rate, from 10.5% on the first band up to 39% on the highest — and there is no tax-free threshold, so the first dollar is taxed.

No. Unlike some countries, New Zealand has no personal allowance — PAYE applies from the first dollar you earn, at the 10.5% rate on the lowest band. That often surprises people arriving from a market with a tax-free band at the bottom of their pay.

Yes. The ACC Earners’ Levy is deducted alongside PAYE — a flat 1.75% of your liable earnings, up to a cap of $156,641 a year (so the levy is never more than $2,741.22 in a year). It funds cover for injuries that happen outside work, and it is a real deduction, separate from income tax.

KiwiSaver is opt-in, so it only comes out of your pay if you’re a contributing member. You choose a rate off your gross — the default from 1 April 2026 is 3.5%, with 3.5%, 4%, 6%, 8%, 10% available. Your contribution reduces your take-home but does not reduce the income PAYE is charged on. Your employer contributes 3.5% on top of your pay — an employer cost that is never taken from your take-home.

If you have a New Zealand student loan and earn salary or wages, 12% of every dollar you earn over the annual repayment threshold ($24,128 a year, about $464 a week) is deducted from your pay, on top of PAYE. It comes off your take-home and does not reduce the income PAYE is charged on.

The Independent Earner Tax Credit is a tax credit — up to $520 a year — for middle-income earners. To qualify you must be a New Zealand tax resident and NOT receiving Working for Families, an income-tested benefit, NZ Super or an overseas equivalent. Where you’re eligible it lowers the PAYE you pay, then tapers away by 13 cents for every dollar you earn over $66,000, reaching nil at $70,000.

The 2026/27 tax year — 1 April 2026 to 31 March 2027. New Zealand’s tax year runs from 1 April to 31 March, not the calendar year, so a “year” in the calculator means that April-to-March window.

The rates come from the Inland Revenue and Employment New Zealand documents cited on the rates pages, one citation per value. Two limits go with that: if a rule changed recently it may not be reflected here yet, and nobody has signed the figures off. For an official amount, use the cited source, your employer or Inland Revenue.