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Payroll taxes
in New Zealand.

SALARY PAYMENT IN New Zealand Dollar (NZD, $)

CONTRACT LANGUAGES English

PAYROLL TAX 4%

PAYROLL CYCLE Monthly

TIME TO HIRE 24 hours

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What is the average employer tax rate in New Zealand?

In New Zealand the corporate income tax rate is 28%. Companies pay on their taxable profits based on the filing of an annual company tax return submitted to the Inland Revenue Department (IRD). 

Most companies carrying on business in New Zealand are also required to register for Goods and Services Tax (GST). 

For further details on employer tax rates in New Zealand, see the IRD website.

What is the average employee tax rate in New Zealand?

New Zealand enforces a progressive or gradual system of taxation meaning that tax rates increase as income increases.There are five employee tax brackets. 

Income tax rates for employees in the 2021-2022 tax year:

Taxable Income (NZD)Tax BracketTax Bracket
0 – $14,00010.50% on taxable income upto $14,00010.50%
$14,001 – $48,000$1,470 plus 17.50% on amount over $14,00017.50%
$48,001 to $70,000$7,420 plus 30.00% on amount over $48,00030%
$70,001 to $180,000$14,020 plus 33.00% on amount over $70,00033%
​$180,000+$50,320 plus 39.00% on amount over $180,00039%

Employer contributions in New Zealand

New Zealand has two social insurance schemes that employers are required to contribute to, the KiwiSaver and the Accident Compensation Corporation Levy (ACC).

Minimum employer contributions (KiwiSaver & ACC) are ≈4.4% – see below for details.

KiwiSaver
Employers must make regular contributions to the KiwiSaver or a complying retirement fund.

The employer contribution matches that of the employee, with the lowest employee contribution to the KiwiSaver scheme being ≈3% of gross salary or wages.

Generally, employers need to pay the employer superannuation contribution tax (ESCT) on all employer contributions to KiwiSaver schemes and complying funds. The rate of ESCT paid varies, based on the employee’s contribution.

Accident Compensation Corporation Levy (ACC)
All employers in New Zealand contribute to the ACC. The levy is used to cover the cost of injuries caused by an accident and to help ensure high standards of health and safety in workplaces.

Employers pay two levies to the ACC:

  • The Work levy varies between businesses based on their circumstances, but average contribution is around 1.3%.
  • The Working Safer levy is a flat rate of 0.08% per NZD$100 of liable payroll or income.

The total employer contribution to the ACC is around 1.46%.

Employee contributions in New Zealand

Employees in New Zealand contribute to the KiwiSaver and the ACC.
Minimum employee contribution is ≈4.47% – see below for details.

The KiwiSaver scheme is for all New Zealand citizens and permanent residents living or normally living in New Zealand.

Employees choose a contribution rate of either 3%, 4%, 6%, 8% or 10% of your before tax pay, with the default rate being 3%.

Everyone who earns a salary in New Zealand pays the Earners’ levy, as part of their mandatory contribution to the ACC.

The current Earners’ levy rate is 1.27% excluding GST or 1.46% inclusive of GST, .

Hiring in New Zealand, Made Easy

Your business can easily hire employees in New Zealand without opening a local entity. We handle local employment law, complex tax regulations, and international payroll in 180+ countries worldwide. All you need to do is focus on your business.

FAQs

The Inland Revenue Department (IRD) is responsible for collecting tax in New Zealand.

Yes, employers in New Zealand contribute to the KiwiSaver and ACC schemes.

Payroll taxes are paid by employers to the Inland Revenue Department who manage the process.

Goods and Services Tax (GST) is New Zealand’s consumption or sales tax. The current rate of GST is 15%. 

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