Country Guides

New Zealand Tax Calculator 2025: Complete Guide to NZ Income Tax & ACC

Calculate your New Zealand income tax with our comprehensive guide covering tax brackets, ACC levies, KiwiSaver, Working for Families, and tax credits.

Tax Calculator TeamFebruary 15, 202512 min read
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New Zealand Tax Calculator 2025: Complete Guide to NZ Income Tax & ACC


New Zealand's tax system is relatively straightforward with progressive income tax rates, ACC levies, and various tax credits. This comprehensive guide will help you understand and calculate your tax liability in New Zealand for the 2024-25 tax year.


New Zealand Income Tax Brackets 2024-25


New Zealand uses a progressive tax system (PAYE - Pay As You Earn) with the following brackets:


Tax Rates for 2024-25:

  • 10.5% on income up to NZ$14,000
  • 17.5% on income between NZ$14,001 and NZ$48,000
  • 30% on income between NZ$48,001 and NZ$70,000
  • 33% on income between NZ$70,001 and NZ$180,000
  • 39% on income over NZ$180,000

    • Example Calculation


    Annual income: NZ$75,000


  • NZ$0 - NZ$14,000: NZ$1,470 (10.5%)
  • NZ$14,001 - NZ$48,000: NZ$5,950 (17.5%)
  • NZ$48,001 - NZ$70,000: NZ$6,600 (30%)
  • NZ$70,001 - NZ$75,000: NZ$1,650 (33%)
  • **Total income tax: NZ$15,670**
  • **Effective rate: 20.9%**

    • ACC Levies


    The Accident Compensation Corporation (ACC) provides no-fault personal injury cover for all New Zealanders.


    Earners' Levy 2024-25


    Rate: 1.53% of liable earnings


    **Maximum liable earnings:** NZ$139,384

    **Maximum levy:** NZ$2,133


    Example: Income NZ$75,000

  • ACC levy: NZ$75,000 × 1.53% = NZ$1,148

    • Working Safer Levy


    Rate: 0.08% of liable earnings

  • Included in the 1.53% rate above
  • Funds workplace injury prevention

    • Self-Employed ACC


    Different rates apply:

  • Based on industry risk
  • Minimum levy applies
  • Can choose cover level

    • Total Tax Burden Example


    Income: NZ$75,000


  • Income tax: NZ$15,670 (20.9%)
  • ACC levy: NZ$1,148 (1.53%)
  • **Total: NZ$16,818 (22.4%)**
  • **Net income: NZ$58,182**

    • Tax Codes


    Your tax code determines how much tax is deducted from your pay.


    Common Tax Codes


    M - Primary income source

  • Most common code
  • Includes tax-free threshold
  • Use for main job

    • ME - Primary with student loan

  • Main job with student loan deductions
  • 12% student loan repayment

    • SB - Secondary income

  • For second job
  • No tax-free threshold
  • Higher withholding

    • S - Secondary with student loan

  • Second job with student loan
  • Higher withholding

    • SH - Secondary high rate

  • 33% flat rate
  • For additional income

    • ST - Secondary top rate

  • 39% flat rate
  • For high earners with multiple jobs

    • CAE - Casual agricultural employee

  • Special rate for seasonal work

    • EDW - Election day worker

  • Special rate for election workers

    • NSW - No notification

  • 45% rate if no tax code provided
  • Avoid by providing correct code

    • Student Loan Repayments


    If you have a student loan, repayments are deducted from your pay.


    Repayment Rate


    12% of income over the threshold


    **2024-25 threshold:** NZ$24,128 (annual)

    **Weekly threshold:** NZ$464

    **Fortnightly threshold:** NZ$928


    Example


    Annual income: NZ$75,000


  • Income over threshold: NZ$75,000 - NZ$24,128 = NZ$50,872
  • Repayment: NZ$50,872 × 12% = NZ$6,105

    • Total deductions:

  • Income tax: NZ$15,670
  • ACC: NZ$1,148
  • Student loan: NZ$6,105
  • **Total: NZ$22,923 (30.6%)**
  • **Net income: NZ$52,077**

    • Overseas-Based Borrowers


    Different rules apply:

  • Must make repayments even if not earning in NZ
  • Minimum repayment amounts
  • Interest may apply

    • KiwiSaver


    KiwiSaver is New Zealand's voluntary retirement savings scheme.


    Contribution Rates


    Employee contributions (choose one):

  • 3% of gross pay
  • 4% of gross pay
  • 6% of gross pay
  • 8% of gross pay
  • 10% of gross pay

    • Employer contributions:

  • Minimum 3% of gross pay
  • Required for employees contributing 3%+

    • Example: NZ$75,000 income, 3% contribution


    Employee contribution:

  • NZ$75,000 × 3% = NZ$2,250

    • Employer contribution:

  • NZ$75,000 × 3% = NZ$2,250

    • **Total KiwiSaver:** NZ$4,500 per year


    Government Contribution


    Member tax credit:

  • 50 cents for every dollar you contribute
  • Up to NZ$521.43 per year
  • Must contribute NZ$1,042.86 to get maximum

    • KiwiSaver Benefits


    First home:

  • Can withdraw for first home purchase
  • Must be member for 3+ years
  • First Home Grant available (up to NZ$10,000)

    • Retirement:

  • Access at 65 (or after 5 years if joined after 60)
  • Lump sum or regular payments

    • Hardship:

  • Early withdrawal in specific circumstances
  • Significant financial hardship
  • Serious illness
  • Permanent emigration

    • Tax Credits


    Independent Earner Tax Credit (IETC)


    Up to NZ$520 per year


    Eligibility:

  • Income between NZ$24,000 and NZ$48,000
  • Not receiving benefits or NZ Super
  • Not receiving Working for Families

    • Amount:

  • NZ$10 per week (NZ$520 per year)
  • Automatically applied if eligible

    • Working for Families Tax Credits


    For families with dependent children:


    Family Tax Credit:

  • NZ$136 per week for first child (0-15)
  • NZ$111 per week for subsequent children (0-12)
  • NZ$136 per week for subsequent children (13-15)
  • Abates at 25% for income over NZ$42,700

    • In-Work Tax Credit:

  • NZ$72 per week for up to 3 children
  • NZ$18 per week for each additional child
  • Must be working minimum hours
  • Abates at 25% for income over NZ$42,700

    • Minimum Family Tax Credit:

  • Ensures minimum income for working families
  • NZ$632 per week after tax
  • Must be working full-time

    • Parental Tax Credit:

  • NZ$220 per week for first 10 weeks
  • For newborns
  • Not receiving Paid Parental Leave

    • Best Start Tax Credit


    For children under 3:

  • NZ$72 per week for first year (all families)
  • NZ$72 per week for years 2-3 (if income under NZ$93,858)
  • Abates at 21% for income over threshold

    • Paid Parental Leave


    26 weeks paid leave:

  • For primary carer
  • Must meet eligibility criteria
  • Rate: NZ$754.87 per week (before tax) for 2024-25

    • Partner's Leave:

  • 2 weeks paid leave
  • Same rate as primary carer

    • Tax on Investment Income


    Resident Withholding Tax (RWT)


    On interest income:

  • 10.5%, 17.5%, 30%, or 33%
  • Based on your tax rate
  • Deducted at source

    • Provide IRD number:

  • To avoid 45% default rate

    • Portfolio Investment Entity (PIE)


    For managed funds:

  • Prescribed Investor Rate (PIR)
  • 10.5%, 17.5%, or 28%
  • Based on income

    • Choose correct PIR:

  • Too high: Overpay tax
  • Too low: May owe tax

    • Dividend Withholding Tax


    On dividends:

  • Usually includes imputation credits
  • Reduces tax on dividends
  • May result in refund

    • Property Tax


    Bright-Line Test


    Capital gains on property:

  • 2 years for main home
  • 10 years for investment property
  • Taxed as income if sold within period

    • Exemptions:

  • Main home (with conditions)
  • Inherited property
  • Relationship property

    • Rental Income


    Fully taxable:

  • All rental income must be declared
  • Can deduct expenses
  • Interest deductibility being phased back in

    • Deductible expenses:

  • Rates and insurance
  • Repairs and maintenance
  • Property management fees
  • Interest (phasing back to 100%)

    • Self-Employed Tax


    Provisional Tax


    Pay tax in installments:

  • If residual income tax over NZ$5,000
  • Three payments per year
  • Based on previous year's income

    • Payment dates:

  • 28 August
  • 15 January
  • 7 May

    • GST (Goods and Services Tax)


    15% on most goods and services


    Must register if:

  • Turnover over NZ$60,000 per year
  • Can register voluntarily

    • Filing periods:

  • Monthly, two-monthly, or six-monthly
  • Depends on turnover

    • Deductible Business Expenses


    Fully deductible:

  • Stock and materials
  • Business premises costs
  • Vehicle expenses (business portion)
  • Equipment and tools
  • Professional fees
  • Marketing and advertising
  • Staff costs

    • Partially deductible:

  • Home office (business portion)
  • Vehicle (business use percentage)
  • Phone and internet (business portion)

    • Tax Planning Strategies


    1. Optimize KiwiSaver


    Strategy:

  • Contribute at least NZ$1,042.86
  • Get maximum government contribution
  • Choose appropriate fund

    • 2. Claim All Tax Credits


    Don't miss:

  • IETC if eligible
  • Working for Families
  • Best Start
  • KiwiSaver member tax credit

    • 3. Manage Student Loan


    Strategies:

  • Make voluntary payments
  • Pay off faster to save interest
  • Keep IRD updated on circumstances

    • 4. Investment Tax Efficiency


    Choose right structure:

  • Correct PIR for PIE investments
  • Provide IRD number for RWT
  • Consider imputation credits

    • 5. Property Investment


    Plan for:

  • Bright-line test
  • Interest deductibility changes
  • Proper expense records

    • Filing Your Tax Return


    Who Must File?


    Individual tax return (IR3) required if:

  • Self-employed
  • Income over NZ$200,000
  • Rental income
  • Foreign income
  • Claiming tax credits

    • Most employees:

  • Don't need to file
  • Tax automatically calculated
  • May get automatic refund

    • Filing Deadline


    **31 March** - End of tax year

    **7 July** - Individual return due (if required)

    **31 March (next year)** - If using tax agent


    myIR


    Online tax account:

  • View income information
  • File returns
  • Check refunds
  • Update details
  • Make payments

    • Common Mistakes to Avoid


    1. **Wrong tax code:** Using SB when should use M

    2. **Not claiming tax credits:** Especially IETC and WFF

    3. **Incorrect PIR:** Overpaying or underpaying on investments

    4. **Missing KiwiSaver credit:** Not contributing enough

    5. **Student loan issues:** Not updating circumstances

    6. **Property tax:** Not understanding bright-line test


    Using Our New Zealand Tax Calculator


    Our calculator provides:

  • Accurate 2024-25 tax calculations
  • ACC levy included
  • Student loan repayments
  • KiwiSaver contributions
  • Tax credits (IETC, WFF)
  • Net income after all deductions

    • Input required:

  • Annual income
  • Tax code
  • Student loan status
  • KiwiSaver contribution rate
  • Number of children (for WFF)

    • Why NZ's Tax System is Straightforward


    Simple structure:

  • No state or local income taxes
  • No capital gains tax (except bright-line)
  • No inheritance tax
  • No payroll tax

    • Efficient:

  • PAYE system works well
  • Most people don't file returns
  • Automatic refunds
  • Good online systems

    • Conclusion


    New Zealand's tax system is relatively simple compared to many countries, with progressive rates up to 39%, ACC levies around 1.5%, and various tax credits that can reduce your liability. The PAYE system means most employees don't need to file tax returns, and the IRD's online systems make managing your tax straightforward.


    Use our New Zealand tax calculator to get an accurate estimate of your tax liability, ACC levies, and net income. Consider consulting with a tax professional for personalized advice, especially if you're self-employed, have rental properties, or have complex income sources.


    **Disclaimer:** This guide provides general information only. New Zealand tax law changes regularly, and individual circumstances vary. Always consult with a qualified tax professional for advice specific to your situation.