Schedular Payments
Schedular payments are payments for certain contract work that have tax withheld at source under tax code WT. Each activity has a standard rate from 10.5% to 33%, and you can elect your own from 10% upwards on an IR330C. No ACC earners' levy, student loan or KiwiSaver is deducted.
Standard withholding rates by activity
If you do not elect a rate, the standard rate for your activity applies. These are the rates Inland Revenue lists on the IR330C.
| Activity | Standard rate | Withheld from $5,000 |
|---|---|---|
| Company director's fees | 33% | $1,650.00 |
| Examiners' fees | 33% | $1,650.00 |
| Honoraria | 33% | $1,650.00 |
| Labour-hire arrangements | 20% | $1,000.00 |
| Commercial cleaning | 20% | $1,000.00 |
| Commissions to insurance agents | 20% | $1,000.00 |
| Modelling | 20% | $1,000.00 |
| Agricultural contracts | 15% | $750.00 |
| Non-resident contractors | 15% | $750.00 |
| ACC personal service rehabilitation payments | 10.5% | $525.00 |
If you give your payer no IR330C at all, the no-notification rate of 45% applies instead of any of these.
Choosing your own rate
An IR330C lets you notify a rate other than the standard one. This is the part of the system that has no equivalent on a payslip: an employee cannot choose how much PAYE comes out, and a contractor can.
- The floor is 10% for most contractors and 15% for non-resident contractors. The ceiling is 100%, which some people use to clear an arrears balance.
- Elect below your real marginal rate and you are borrowing from yourself. The shortfall becomes a bill after 31 March. The income tax bands are what your elected rate should be aiming at, and there is no averaging in your favour.
- Nothing else is coming out, so the rate has more work to do. An employee's PAYE already contains the ACC earners' levy. Yours does not, and ACC will invoice you separately, so a rate that matches your income tax band still leaves the levy unfunded.
- You can change it. Give your payer a new IR330C whenever your circumstances change. It takes effect from the next payment rather than retrospectively.
Example. A $5,000 invoice at 20%
- 1.Schedular payment$5,000.00
- 2.Withholding rate elected on the IR330C20%
- 3.Tax withheld and paid to Inland Revenue− $1,000.00
- 4.ACC earners' levyNot deducted from a schedular payment. ACC invoices you directly.$0.00
- 5.Student loanNo 12% deduction. The obligation is settled after 31 March.$0.00
- 6.KiwiSaverNo employee deduction and no employer contribution.$0.00
- Paid into your account$4,000.00
What is not deducted, and what that costs you
The withholding on a schedular payment covers income tax and nothing else. Three deductions that an employee never has to think about become your responsibility, and all three arrive later.
- No ACC earners' levy. An employee pays 1.75% through PAYE, up to $156,641 of earnings. You pay the earners' levy and a work levy on an invoice from ACC, based on the activity you carry out.
- No student loan deduction. An employee on an SL code has 12% taken above $24,128 a year, every payday. Your repayment obligation on schedular income is calculated at the end of the year, from money you must have kept.
- No KiwiSaver, either side of it. No employee deduction comes out, and there is no 3.5% employer contribution to receive. A KiwiSaver member contracting instead of being employed contributes directly to their provider or not at all.
This is why a contractor rate and a salary are not comparable figures. The same $100,000 is worth materially less as schedular income than as salary once the levy and the missing employer contribution are counted.
If you are registered for GST
The withholding is calculated on the GST-exclusive amount of your invoice, so the GST itself never has tax deducted from it.
Common questions
What are schedular payments?
Payments for certain kinds of contract work that have tax withheld at source, even though the person doing the work is a contractor rather than an employee. The activities are listed in tax law: directors' fees, labour-hire work, commercial cleaning, modelling, agricultural contracts, insurance commissions and more. The tax code is WT.
What tax rate do I use for schedular payments?
Each activity has a standard rate, 10.5% to 33%. You can elect a different one on an IR330C: anything from 10% to 100%, or from 15% if you are a non-resident contractor. The code that carries it is WT.
Is ACC deducted from schedular payments?
No. The 1.75% earners' levy is deducted through PAYE, and a schedular payment is not PAYE. ACC invoices contractors directly for both the earners' levy and a work levy, so the cost has not gone away. It arrives as a bill instead of a deduction.
Do I pay student loan on schedular payments?
Nothing is deducted at source. The 12% you would see on a payslip does not appear on a schedular payment. Your repayment obligation on that income is worked out after 31 March instead, which means the money needs to still be there.
What happens if I do not give my payer an IR330C?
Your payer must deduct at the no-notification rate of 45%. That is above every standard rate and above the top income tax rate, so the form is worth completing before the first invoice rather than reclaiming the difference after 31 March.
Is the tax withheld the final amount of tax I pay?
No. It is a payment on account, not a final tax. Inland Revenue works out your actual income tax after 31 March on your total income and credits what was withheld against it. Elect too low a rate and you get a bill. Elect too high and you get a refund.
Where these figures come from
2026–27 tax year (1 April 2026 – 31 March 2027). Last verified 30 July 2026.
Related
- tax code WTThe withholding code, and how it differs from M
- New Zealand tax codesWhere WT sits among the codes an employee uses
- ACC earners' levyWhy a contractor gets a bill instead of a deduction
- New Zealand tax refundWhat happens when your elected rate was too high
- New Zealand tax bracketsThe scale your elected rate should be aiming at