How we calculate NZ take-home pay

Defaults

• Tax year 2026–27 (1 April 2026 – 31 March 2027); tax code M; KiwiSaver at the 3.5000000000000004% default in the calculator (salary pages show figures without KiwiSaver first); no student loan; paid fortnightly.

Order of the calculation (IRD payroll specification, sections 5.2–5.6)

1. Pay for one period × the number of pays in a year (52, 26, 13 or 12), with cents dropped.
2. Annual income tax from IRD's formulas for the 2026–27 rates, plus the ACC earners' levy (1.7500000000000002%, capped at $2,741.22). Code ME subtracts the independent earner tax credit.
3. Divide by 52 and cut to whole cents; for other pay periods, × 52 ÷ pays per year, cut to cents again.
4. Secondary codes: a flat rate (including ACC) on the pay rounded down to whole dollars.
5. Student loan: 12% of whole-dollar pay over the period threshold, cut to cents (secondary jobs: of all pay).
6. KiwiSaver: your rate × gross pay, cut to cents. The employer's contribution is shown separately and isn't taken from your pay.
7. Yearly figures are one pay × the number of pays, so they can differ by cents from the annual tax.

Known limits

• Tailored tax codes, special tax codes, extra student loan deductions, child support, payroll giving and lump sums (bonuses) are not modelled.
• The independent earner tax credit eligibility rules (no Working for Families, NZ Super or benefits) are your call; we only apply it on code ME.

Every release is tested against cases from the official calculator: see accuracy tests. Rate changes are logged in the changelog.