Is Overtime Worth It Calculator NZ

This calculator works out what your overtime is really worth in New Zealand once tax is taken into account, because extra hours are taxed at your marginal rate rather than some special overtime rate. Overtime pay stacks on top of your normal income, so it is taxed at your highest tax band, which means the take-home value per hour is often lower than the headline rate you are being paid. You enter your normal annual income, your overtime hourly rate, and the number of overtime hours you are considering, and the calculator applies the current New Zealand income tax brackets to work out the tax on the overtime specifically. It returns the net pay from the overtime after tax, the gross overtime pay before deductions, the net amount you actually keep per hour, and your marginal tax rate, so you can compare the real per-hour return against your time and energy. Use it before agreeing to extra shifts, weighing overtime against other paid work, or deciding whether a pay rise into a higher bracket is worth it. The calculation excludes the ACC earner's levy, KiwiSaver contributions and student loan repayments, which would reduce the net figure further if they apply to you. It is an indicative estimate based on standard tax brackets, not personalised tax advice, so check your payslip or a tax adviser for your exact position.

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$
$1,260
net pay from the overtime after tax
Gross overtime pay$1,800
Net per hour$31.50
Your marginal rate30%

Based on the 2025/2026 income tax brackets. Overtime is taxed at your marginal rate because it stacks on your income. This excludes the ACC levy, KiwiSaver and student loan, which would reduce the net further. Estimate only, not tax advice.

How it works

The calculator works out the tax on your normal income, then on your income plus the overtime pay. The difference is the tax on the overtime, which it deducts to show your net and your net per hour. Because the overtime is taxed at your marginal rate, the net per hour can be well below the gross rate, which is the figure to weigh against your time.

Worked example

On a $70,000 income, 40 hours of overtime at $45 an hour is $1,800 gross. Taxed at the 30% marginal rate, the tax is about $540, leaving roughly $1,260 net, or about $31.50 net per hour rather than the $45 headline rate.

Related calculators

Data sources: the rates and thresholds on this page are maintained against Inland Revenue. Figures are checked twice monthly.

Frequently asked questions

Is overtime taxed more in New Zealand?

There is no special overtime tax, but because overtime stacks on top of your normal pay it is taxed at your marginal rate, which is your highest band. So the after-tax value of each overtime hour can be lower than your headline rate suggests.

How do I work out the real value of overtime?

Take the overtime pay, then deduct tax at your marginal rate to get the net. This calculator does that, so you can see what an hour of overtime actually puts in your pocket after tax.

Why does my overtime feel heavily taxed?

Because it is taxed at your top marginal rate, the deduction is larger than on your first dollars of income. The square-up at year end settles the total, but the net per hour is what matters for the decision.