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PAYE Calculator NZ

Pay and Tax Glossary

21 terms that appear on a New Zealand payslip or in this calculator, each defined with its figure attached. Current for the 2026–27 tax year.

A to Z

ACC earners' levy
A levy funding cover for non-work injuries, deducted from your pay alongside income tax at 1.75% of liable earnings up to $156,641, so it never exceeds $2,741.22 a year. Inland Revenue bundles it with income tax in the PAYE tables, which is why the deduction on your payslip is larger than the tax bands alone predict. See ACC earners' levy.
Annual holiday pay
Pay for annual leave you take, calculated as the greater of your ordinary weekly pay and your average weekly earnings. Not the same as the 8% accrual paid out when you leave a job. See holiday pay calculator.
Average weekly earnings (AWE)
Your gross earnings for the last 12 months divided by 52. One of the two figures compared when annual leave is paid; you receive whichever is greater.
ESCT
Employer superannuation contribution tax. Tax on the KiwiSaver contribution your employer makes, deducted from that contribution before it reaches your fund, which is why the headline 3.5% is worth less than it sounds. Banded from 10.5% to 39% on your previous year's pay plus employer contributions. See ESCT.
Extra pay
A lump sum paid on top of regular salary: a bonus, back pay, redundancy, or holiday pay cashed up or paid out on termination. Taxed at a rate set by your recent income annualised plus the lump sum, which is why a payout can be taxed higher than your salary. See how extra pay is taxed.
Gross pay
Your pay before any deduction. Every deduction on a payslip is calculated from this figure, not from each other. See gross versus net pay.
Independent earner tax credit (IETC)
A tax credit for people earning between $24,000 and $70,000 who do not receive Working for Families, a main benefit or superannuation. Delivered through tax code ME or ME SL. See the independent earner tax credit.
KiwiSaver employee contribution
The share of your gross pay you put into KiwiSaver: 3.5%, 4%, 6%, 8%, 10%, with 3.5% the default and the minimum. It comes out of pay that has already been taxed. See KiwiSaver contribution rates.
KiwiSaver employer contribution
The compulsory 3.5% your employer pays on top of your salary, rising to 4% on 1 April 2028. It never appears in your take-home, and ESCT is deducted from it. See KiwiSaver employer contribution.
KiwiSaver government contribution
25% of what you contribute yourself between 1 July and 30 June, up to $260.72 a year. See the government contribution.
Marginal rate
The rate applying to your next dollar of income, as opposed to the effective rate you pay across all of it. Earning one dollar more never reduces your take-home pay. See New Zealand tax brackets.
Net pay
What actually reaches your bank account, after every deduction. Also called take-home pay.
Ordinary weekly pay (OWP)
What you normally earn in a week, taken from your employment agreement or from a 4-week formula. Compared against average weekly earnings when annual leave is paid.
PAYE
Pay As You Earn. The system your employer uses to deduct and remit income tax and the ACC earners' levy, and to file KiwiSaver and student loan deductions each payday. Often used loosely to mean income tax alone. See what is PAYE.
Secondary tax code
The code used for a second job, taxing that income at a flat rate based on your total income from all sources. It is not a penalty rate, and the codes are SB, S, SH, ST and SA. See secondary tax.
Schedular payment
A payment to a contractor with withholding tax deducted at source under the WT code. Carries no ACC earners' levy, no KiwiSaver and no student loan deduction. See schedular payments.
Student loan repayment
12% of every dollar you earn above $24,128 a year, deducted through PAYE when your tax code carries the SL suffix. See student loan repayments.
Square-up
The end of year reconciliation between the tax deducted from your pay and the tax you actually owed. Produces a refund or a bill. See the New Zealand tax year.
Tax code
The code you give your employer that tells payroll which rules to apply: M, ME, the SL suffix for a student loan, or a secondary code for a second job. The wrong code is the most common cause of an unexpected bill. See New Zealand tax codes.
Tax year
1 April 2026 to 31 March 2027. Most rates change on 1 April. The KiwiSaver government contribution is the exception, running 1 July to 30 June. See the tax year.
Total remuneration
A package where the employer KiwiSaver contribution comes out of your stated salary rather than sitting on top of it. Legal only by agreement. See total remuneration.

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