NZ Marginal Rate Reality Visualiser
This calculator shows the true marginal tax rate you pay on your next dollar of income in New Zealand, not just the PAYE bracket rate most people quote. Enter your annual gross income, or drag the slider up to $300,000, then choose your KiwiSaver rate and whether you have a student loan. It combines the 10.5%, 17.5%, 30%, 33% and 39% PAYE brackets with the ACC earners' levy, the Independent Earner Tax Credit taper between $66,000 and $70,000, KiwiSaver deductions and student loan repayments to reveal your real cost of earning more. Results update live across four metric cards: your true marginal rate on the next dollar, your effective tax rate on total income, how much you keep from each extra $1,000, and your annual net take-home pay. A breakdown bar splits your income into net pay, PAYE, ACC, KiwiSaver and student loan, while a zone box and a per-$1,000 table show exactly where each cent goes at your income level, with alerts as you near a threshold. A separate pay rise calculator lets you enter a current salary and a proposed rise to see what you actually pocket after deductions, flagging any thresholds crossed. Figures use 2026/27 IRD thresholds and are indicative only, since your actual pay can differ depending on your tax code and other income.
IETC taper
ACC cap
What Does a Pay Rise Actually Put in Your Pocket?
Enter your current salary and a proposed pay rise to see exactly how much of that raise you actually keep after all deductions. The calculator automatically detects any tax threshold crossings in the range.
2026/27 NZ Tax Threshold Reference
The following table lists every significant threshold in the NZ personal tax system for the 2026/27 tax year (1 April 2026 - 31 March 2027). Understanding these boundaries helps you see exactly where your income sits and what changes when you cross each one.
| Threshold | Type | Value | What changes when you cross it |
|---|---|---|---|
| $0 | PAYE bracket starts | 0 - $15,600 | 10.5% income tax applies on every dollar up to $15,600 |
| $15,601 | PAYE bracket change | $15,601 - $53,500 | Tax rate increases to 17.5% on each dollar above $15,600 |
| $24,000 | IETC starts | $520/year credit | The Independent Earner Tax Credit begins. You receive up to $520/year, reducing your effective rate |
| $24,128 | Student loan threshold | 12% above threshold | Student loan repayments begin at 12% of every dollar above this annual threshold |
| $53,501 | PAYE bracket change | $53,501 - $78,100 | Tax rate increases to 30% on each dollar above $53,500 |
| $66,001 | IETC taper starts | -$0.13 per $1 above $66K | IETC begins reducing by $0.13 per dollar - adding an effective 13% to your marginal rate even though you're still in the 17.5% bracket |
| $70,000 | IETC fully tapered | $0 credit | IETC disappears entirely. The hidden 13% taper surcharge is over |
| $78,101 | PAYE bracket change | $78,101 - $180,000 | Tax rate increases to 33% on each dollar above $78,100 |
| $156,641 | ACC earners' levy cap | Max levy $2,741.22/year | ACC earners' levy no longer applies. This actually reduces your effective marginal rate by 1.75% |
| $180,001 | PAYE bracket change | $180,001 and over | Tax rate increases to 39% on each dollar above $180,000 |
The IETC Taper: New Zealand's Most Misunderstood Tax Zone
The Independent Earner Tax Credit is designed to benefit middle-income earners. But between $66,000 and $70,000, it creates an effective marginal rate far higher than most people expect. While you're nominally in the 17.5% income tax bracket in this zone, you also lose $0.13 of IETC for every extra dollar earned. Combined with the 1.75% ACC levy, your true marginal rate in the $66,000-$70,000 zone is 17.5% + 1.75% + 13% = 32.25% - nearly double the stated bracket rate.
Add a 3.5% KiwiSaver deduction and the marginal rate reaches 35.75%, even though your tax bracket says 17.5%. This is why the stated bracket rate can be deeply misleading, and why this visualiser shows your true marginal rate rather than just your bracket rate.
The ACC Cap Dividend
Above $156,641, ACC earners' levy no longer applies. This creates an unusual effect where earning more above the cap actually comes with a lower marginal rate than below it - your effective marginal rate drops by 1.75% at this point. On the income between $156,642 and $180,000 you pay 33% income tax but no ACC, giving an effective marginal rate of 33% rather than the 34.75% you were paying just below the cap.
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