Income Tax PAYE Calculator NZ

What is PAYE Calculator?

In New Zealand, as an employee earning wage or salary, you are taxed directly from your pay. This is known as PAYE, short for Pay-As-You-Earn.
Your employer is responsible for deducting and paying PAYE income tax on your behalf.
IRD developed this system to make it easier for employees to pay their taxes without needing to do so in lumpsum, usually during tax season. In order to use this system, all employees must have completed a Tax Code Declaration (IR330) the moment you start working.

Your PAYE tax periods usually run from 1 April to 31 March of any year, and if you are on an M tax code (most common Kiwi tax code), then your PAYE is as follows:

  • 11.89% on income $0 to $14,000
  • 18.89% on income from $14,001 to $48,000
  • 31.39% on income from $48,001 to $70,000
  • 34.39% on income from $70,001 to $122,063*
  • *If your income is above $122,063 your PAYE would be 33%, because $1,696.67 (ACC of 1.39% capped at $122,063)

To learn more about tax codes, click here!

Is it possible to overpay PAYE?

Generally, no, in most cases PAYE ensures the correct tax is deducted, but there can still be exceptions such as:

  • Wrong income tax rate because the wrong tax code was used.
  • Your employer calculated your PAYE incorrectly in their payroll system.
  • You worked for only a part of the year.
  • You changed jobs during a year.
  • You don’t work for part of a year.
  • You worked irregular hours.
  • You did part-time or on-call work.
  • Your income changed during the year.

In either case you can get refunds on your overpaid PAYE. Want to find out how? Apply for free right now and they will let you know if you are due any tax refunds.

What is KiwiSaver?

It is a savings initiative whose purpose is to help set you up for your retirement.

How to join KiwiSaver?

If you are a New Zealander, and below 65 years of age, you can join KiwiSaver in any of the three ways:

  • Automatic enrolment - When you start a new job, and if you're not already a member, your employer will automatically enrol you in KiwiSaver.
  • Opting in through a provider - You can choose to join a KiwiSaver scheme of your choice by contacting a provider directly.
  • Opting in through your employer - You can ask your employer for an employee information pack and fill up the KiwiSaver deduction form.

What are the benefits of KiwiSaver?

KiwiSaver has a range of benefits, although, the most notable ones are:

  • Member Tax Credit - the Government makes an annual contribution towards your KiwiSaver account as long as you are a contributing member aged 18 above.
  • Compulsory Employer Contributions - If you're eligible, your employer also contributes an amount equal to 3% of your pay to your KiwiSaver.
  • Savings Withdrawal for First Home - You may be able to withdraw some or all of your KiwiSaver savings for buying your first home.
  • KiwiSaver HomeStart grant - After 3 years, you may be entitled to grants administered by Housing New Zealand.

How does KiwiSaver work?

Your KiwiSaver savings are made up of contributions to your account, plus or minus investment returns, minus withdrawals, fees and taxes.

  • Contributions are paid to your KiwiSaver provider who are invested in the scheme of your choice.
  • Add or subtract your investment returns which can go up or down over time.
  • Subtract withdrawals (like first home withdrawal), fees and taxes.
  • And you're left with your retirement savings.

Most people become eligible to get their money when they attain the age of 65.