Tax & inflation New Zealand
Income Tax Calculator NZ
Most New Zealand tax calculators stop at the income tax owed, which is not what anybody is actually asking. This returns what lands in your account: tax, plus the ACC earners' levy, minus KiwiSaver and any student loan deduction.
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Take-home pay, per year
—Income tax
—
ACC levy
—
KiwiSaver
—
Student loan
—
Effective tax rate
—
Top marginal rate
—
Take-home pay by period
Working with a different rate? Edit the rates this calculator uses
These are the figures we verified on 2026-10-28. Change them to work with a historic period, or with a new rate that has been announced but which we have not published yet.
Thresholds verified unchanged for the 2026/27 tax year (1 April 2026 – 31 March 2027); they have not moved since 1 April 2025
Earners' levy rose from 1.67% to 1.75% on 1 April 2026, the start of the 2026/27 tax year, with the cap lifted at the same time
Maximum liable earnings for 2026/27 — the levy stops at $2,741.22 a year
Estimate only, not tax advice. An estimate of a standard salaried situation. It does not handle secondary tax codes, independent earner tax credit, Working for Families, ESCT on employer KiwiSaver contributions, self-employment, or income taxed at source. Inland Revenue's own calculators and your payslip are the authority. Not tax advice.
How is PAYE calculated in New Zealand?
Income tax is charged in progressive bands, so each slice of income is taxed at its own rate rather than the whole amount at your top rate. PAYE deducted from a pay packet is that tax plus the ACC earners' levy. KiwiSaver and student loan repayments come out on top of PAYE, which is why take-home pay is lower than a tax-only calculation suggests.
Why the ACC levy belongs in the calculation
Income tax and PAYE are not the same number, and the gap is the ACC earners' levy.
The levy is charged on your earnings up to an annual cap and funds New Zealand's accident compensation scheme. It appears on your payslip as part of the PAYE deduction, but it is not part of the income tax bands and does not follow them.
Leaving it out overstates take-home pay by several hundred dollars a year on a typical salary — enough to make a calculator useless for the thing people actually use one for, which is checking a payslip.
Marginal against effective
Two rates get confused constantly and they answer different questions.
Your marginal rate is what the next dollar you earn is taxed at. It matters for decisions — overtime, a second job, a pay rise.
Your effective rate is total tax divided by total income, and it is always lower, because the earlier bands were taxed at lower rates. It is the honest answer to "how much tax do I actually pay".
Both are shown above, and the gap between them is a good illustration of how progressive banding works in practice.
A secondary tax code on a second job often looks punitive for this reason — it applies a flat rate reflecting your combined income rather than starting again at the bottom band.
How this is calculated
Progressive bands, then the levies and deductions that turn income tax into PAYE and PAYE into take-home pay.
income tax = sum over bands of (income in that band × that band's rate)rates: 10.5% · 17.5% · 30% · 33% · 39%ACC earners' levy = min(income, levy cap) × levy ratePAYE = income tax + ACC levyKiwiSaver = gross income × your contribution ratetake-home = gross − PAYE − KiwiSaver − student loan
Progressive banding is the part most often misunderstood. Moving into a higher band does not tax your whole income at the higher rate — only the income above that threshold is taxed at it. A pay rise can never leave you worse off through tax alone.
The ACC earners' levy is separate from income tax and is not part of the bands. It is charged on earnings up to an annual maximum and funds accident cover, which is why it appears on a payslip alongside PAYE rather than inside it. Leaving it out is the single most common reason a calculator overstates take-home pay.
A worked example: $75,000 with 3% KiwiSaver
A salary of $75,000 a year, contributing 3% to KiwiSaver, no student loan, with the ACC levy included.
- Income taxed in each bandprogressively
- Income taxsee the result above
- ACC earners' levyon the whole salary
- KiwiSaver — 3% of $75,000$2,250
- Total deductionstax + levy + KiwiSaver
- Take-home paygross less those three
The figures above are computed live from the thresholds in the rate panel, which must be verified against Inland Revenue before launch.
Deliberately not hard-coded into this example: the band thresholds are the one thing on this page that cannot be stated as fact until they are checked against the current Inland Revenue tables.
What sits outside this calculation
Several things change a real New Zealand tax position and none of them are modelled here.
Secondary tax codes apply when you have more than one source of income. Working for Families tax credits change the net position substantially for households with children. The independent earner tax credit applies within a specific income range.
Employer KiwiSaver contributions are taxed separately through ESCT, which is why an employer's 3% does not arrive as a full 3%. And self-employment changes the mechanics entirely — provisional tax rather than PAYE, and ACC levies charged on a different basis.
For anything beyond a straightforward salary, Inland Revenue's own calculators and an accountant will give you an answer this page cannot.
What this calculator does not do
- Band thresholds and the ACC levy must be verified against Inland Revenue before use
- Assumes a single job on a primary tax code
- Excludes Working for Families, the independent earner tax credit and ESCT
- Does not handle self-employment or provisional tax
Common questions
What are the New Zealand income tax rates?
Five progressive bands at 10.5%, 17.5%, 30%, 33% and 39%. Each slice of income is taxed at its own band's rate — moving into a higher band does not tax your whole income at that rate.
What is the ACC earners' levy?
A separate levy on your earnings, up to an annual cap, that funds New Zealand's accident compensation scheme. It is deducted alongside income tax as part of PAYE but is not part of the tax bands.
Why is my take-home pay lower than a tax calculator says?
Most calculators show income tax only. Your actual deductions are income tax plus the ACC levy, then KiwiSaver and any student loan repayment on top of that.
What is the difference between marginal and effective tax rate?
Marginal is what your next dollar is taxed at; effective is total tax divided by total income. Effective is always lower, because the earlier bands were taxed at lower rates.
Does a pay rise ever leave me worse off?
Not through income tax. Only the income above a threshold is taxed at the higher rate, so more gross income always means more net income. Abatement of certain assistance payments is a separate matter.
Where these numbers come from
- Inland Revenue — income tax rates for individuals Five brackets verified: 10.5% to $15,600, 17.5% to $53,500, 30% to $78,100, 33% to $180,000, 39% above
- Inland Revenue — KiwiSaver contribution rates Employee contribution rate options
- Inland Revenue — ACC earners' levy rates The 1.75% rate and the $156,641 maximum earnings for 2026/27
Rates last verified 2026-10-28 Every figure Inland Revenue sets is re-checked against the source at least once a year, and again whenever a change is announced. Out of date? Tell us and we will fix it.
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