How is the PIR worked out?

For each of the last two income years you take the higher of your taxable income alone and your taxable income plus PIE income. Your PIR is then based on the lower of those two yearly figures, using the 10.5, 17.5, or 28 percent thresholds.

What if my PIR is wrong?

If your PIR is too low you may have extra tax to pay at year end, and if it is too high you could be paying more than necessary. It pays to review your PIR each year and update it with your provider if your income changes.

PIE Prescribed Investor Rate (PIR) Calculator

The PIE Prescribed Investor Rate Calculator helps New Zealand investors find the correct PIR to give their PIE provider, such as a KiwiSaver scheme or managed fund. A PIE taxes your investment income at your prescribed investor rate rather than your normal marginal rate, and choosing the right PIR matters because too low a rate leaves you with tax to pay, while too high a rate can mean overpaying. The PIR is based on the lower of the two previous income years. For each of those years you look at your taxable income on its own and your taxable income plus your PIE income, take the higher figure for that year, and then your PIR is set by the lower of the two years' results. For each year, the band is 10.5 percent if taxable income is $15,600 or less and combined income is $53,500 or less; 17.5 percent if taxable income is $53,500 or less and combined income is $78,100 or less; and 28 percent otherwise. The lower of the two years' rates is your PIR. You enter your taxable income for each of the last two years and your PIE income, and the tool returns the correct PIR along with the combined income figures it used. KiwiSaver members, managed fund investors, and their advisers use it at the start of each year to confirm the rate on file is still right after a change in income. A couple of tips help. Use your actual taxable income from each year's return, and include all your PIE income for the year, not just one fund. Check your PIR every year because a pay rise or a drop in income can move you between bands. This is a clear estimate to guide your choice, not formal tax advice.

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Taxable income, prior year 1 ($)

Taxable income, prior year 2 ($)

PIE income for the year ($)

17.5%

Your PIR

Year 1 combined$49,500

Year 2 combined$51,500

For each year the PIR is 10.5% if taxable income is $15,600 or less and combined income is $53,500 or less; 17.5% if taxable income is $53,500 or less and combined income is $78,100 or less; otherwise 28%. The lower of the two years' rates applies. Estimate only, not financial or tax advice.

How it works

For each of the two prior years the tool works out a rate based on two tests: taxable income alone and taxable income combined with PIE income. The rate for each year is 10.5 percent if taxable income is $15,600 or less and combined income is $53,500 or less; 17.5 percent if taxable income is $53,500 or less and combined income is $78,100 or less; otherwise 28 percent. Your PIR is the lower of the two years' rates.

Worked example

With $48,000 taxable income in year 1 and $1,500 PIE income, the combined figure is $49,500. Taxable income ($48,000) is $53,500 or less and combined ($49,500) is $78,100 or less, so year 1 is 17.5 percent. With $50,000 taxable in year 2, the combined figure is $51,500. Both tests are also met, so year 2 is also 17.5 percent. The lower of the two years is 17.5 percent, so the PIR is 17.5 percent.

Related calculators

KiwiSaver Retirement Projection Calculator: project your KiwiSaver.
RWT on Interest Calculator: tax on interest earned.
ESCT Rate Calculator: employer super tax rate.
Term PIEs vs Term Deposits: After-Tax: the background to this calculation.
RWT and PIR: Tax on Interest and Investments: background on this topic.

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