New Zealand's income tax brackets were raised on 31 July 2024 and haven't changed since, so they apply unchanged to the 2026/27 tax year, which runs from 1 April 2026 to 31 March 2027. One thing surprises people moving from Australia or the UK: there's no tax-free threshold. Tax starts at 10.5% on the first dollar.
The 2026/27 brackets
- $0 to $15,600: 10.5%
- $15,601 to $53,500: 17.5%
- $53,501 to $78,100: 30%
- $78,101 to $180,000: 33%
- Over $180,000: 39%
A worked example at $85,000
Income tax (10.5% to 39% brackets)
brackets applied to NZ$85,000equalsNZ$17,927.50
ACC earners' levy
min(NZ$85,000, NZ$156,641) × 1.75%equalsNZ$1,487.50
Take-home
NZ$85,000 − NZ$17,927.50 − NZ$1,487.50equalsNZ$65,585.00
Income tax takes $17,927.50 and ACC $1,487.50, leaving $65,585 a year, about $5,465 a month before KiwiSaver or student loan deductions. On $100,000 the income tax alone is $22,877.50.
The ACC earners' levy
On top of income tax, earners pay the ACC earners' levy to fund accident cover, up to a maximum amount of earnings each year. The rate is reset regularly, and published figures differ depending on whether GST is included, so check the current rate with Inland Revenue.
Contractors and sole traders
Self-employed people pay the same rates, usually through provisional tax instalments during the year. Contractors receiving schedular payments can have tax withheld at a rate they choose. GST is 15% once you're registered.
Tip: If you're self-employed, set aside a fixed share of every invoice for tax, ACC and GST, and move it into a separate account the day you're paid.