This calculator helps New Zealand contractors and the businesses that hire them translate between a daily or hourly contract rate and an equivalent permanent salary, in both directions. It accounts for the things that make contracting genuinely different: no paid annual leave, sick leave or public holidays, no employer KiwiSaver contribution, ACC levies you pay yourself, and the unbillable gaps between contracts. You can set your expected billable days per year, and the tool shows the salary a given day rate really equates to once those factors are stripped out, and conversely the day rate you would need to match a salary. A clear breakdown reveals how much of the headline rate is actually compensating for lost leave, KiwiSaver and downtime, so contractors price their work properly and employees can compare an offer on a like-for-like basis.
The model equates the full employer cost of a salary (salary plus employer KiwiSaver) with contractor revenue earned over your billable days, so fewer billable days or lost leave push the required rate up. Remember you also pay your own ACC levies as a contractor. Estimate only, this is general information and not financial advice.
To compare fairly, the calculator looks at the full cost an employer carries for a permanent role, which is the salary plus the employer KiwiSaver contribution. A contractor only earns on billable days and receives none of the paid leave or employer KiwiSaver that a salaried worker does. So the equivalent salary for a day rate is the day rate times your billable days, divided by one plus the employer KiwiSaver rate. The required day rate to match a salary reverses this. Because billable days already strip out leave, public holidays and downtime, a realistic billable-days figure is the key input.
At $800 a day over 220 billable days, contractor revenue is $176,000. After allowing for a 3% employer KiwiSaver contribution that a salary would include, that equates to roughly a $170,000 salary, before you also fund your own ACC. To match a $120,000 salary, you would need a day rate of around $562 over the same 220 days.
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