PIR Overpayment Recovery Calculator NZ 2026/27
A prescribed investor rate is easy to set once and never look at again, which is exactly why so many of them are wrong. The most common case is a KiwiSaver account opened at a student or first-job income, sitting on 10.5% a decade later while the member earns enough for 28%. The reverse is just as common, since people often assume the PIR matches their income tax rate and select 28% when they are entitled to 17.5%. Either way the error compounds quietly, because nothing on a payslip or a bank statement ever flags it. This page quantifies the damage. Enter the PIE income from your annual tax certificates for the last five tax years, the rate that was applied and the rate that should have been, and it returns the tax paid, the tax that was due, the difference year by year, and the direction of the error. It also separates the two halves of the loss that people conflate: the tax itself, which Inland Revenue's end-of-year calculation does return as a refundable credit where you overpaid, and the investment growth on that money, which is gone permanently because the tax was deducted from your fund and never earned anything. The second figure is the argument for fixing the rate today rather than only chasing the history.
Tax due = the same PIE income × the PIR that should have applied.
Difference = tax paid − tax due. A positive figure is an overpayment; a negative figure is an underpayment you owe.
Overpayment treatment. Inland Revenue's end-of-year PIE calculation states that too much tax paid on PIE income produces a PIE credit, that it reduces any income tax payable, and that any remaining credit is refunded.
Underpayment treatment. The same source states that too little tax paid produces a PIE debt, added to the income tax payable on your taxable income.
Older years. This automatic end-of-year treatment has not always applied, and Inland Revenue does not publish a reassessment window on that page. If your wrong rate goes back several years, confirm with Inland Revenue which years can still be assessed.
Growth forgone compounds each year's difference at your chosen return rate from the end of that tax year to the end of the most recent one. No use-of-money interest is assumed on the refund.
PIR bands are 10.5%, 17.5% and 28%, tested on the better of the last two income years using taxable income and PIE income together. Our PIR rate calculator applies the test.
Excluded: multiple PIRs within a single year, transitional residents, and non-resident and zero-rated investors.
Not tax advice. Last verified: against ird.govt.nz.
Year by year
| Tax year | PIE income | Tax paid | Tax due | Difference | With growth |
|---|---|---|---|---|---|
| 2021/22 | $2,400.00 | $672.00 | $420.00 | $252.00 | $306.31 |
| 2022/23 | $2,900.00 | $812.00 | $507.50 | $304.50 | $352.50 |
| 2023/24 | $3,500.00 | $980.00 | $612.50 | $367.50 | $405.17 |
| 2024/25 | $4,200.00 | $1,176.00 | $735.00 | $441.00 | $463.05 |
| 2025/26 | $5,000.00 | $1,400.00 | $875.00 | $525.00 | $525.00 |
| Total | $18,000.00 | $5,040.00 | $3,150.00 | $1,890.00 | $2,052.02 |
A positive difference is tax you overpaid. A negative one is tax you owe. The final column compounds each year's difference to the end of the most recent tax year.
What comes back and what does not
| Rate you were over by | 10.5% |
| Total PIE income across the years entered | $18,000.00 |
| Tax difference | $1,890.00 |
| Treatment | Refundable credit |
| Value if it had stayed invested | $2,052.02 |
| Growth you do not get back | $162.02 |
Inland Revenue returns the tax where you overpaid. It does not return the growth that money would have earned inside your fund.
What every wrong-rate combination would have cost
| PIR applied | Correct PIR | Gap | Difference | Result |
|---|---|---|---|---|
| 28% | 10.5% | 17.5% | $3,150.00 | Refundable credit |
| 28% | 17.5% | 10.5% | $1,890.00 | Refundable credit |
| 17.5% | 10.5% | 7% | $1,260.00 | Refundable credit |
| 10.5% | 17.5% | 7% | -$1,260.00 | Debt you owe |
| 17.5% | 28% | 10.5% | -$1,890.00 | Debt you owe |
| 10.5% | 28% | 17.5% | -$3,150.00 | Debt you owe |
Applied to the $18,000.00 of PIE income entered above. Your combination is highlighted.
Nothing Tells You The Rate Is Wrong
A wrong PAYE code shows up in a payslip. A wrong PIR shows up nowhere. The tax is deducted inside the fund before the return reaches your balance, so the only place it appears is the annual tax certificate, which most people never open.
That is why the errors run for years. The rate was correct when it was set, income changed, and nothing in the system prompted a review.
Worked Example: Five Years At 28% Instead Of 17.5%
PIE income of $2,400.00, $2,900.00, $3,500.00, $4,200.00 and $5,000.00 across the five tax years to 31 March 2026, totalling $18,000.00.
At the 28% rate that was applied, the tax was $5,040.00. At the correct 17.5%, it should have been $3,150.00. The difference is $1,890.00.
Under Inland Revenue's end-of-year PIE calculation that overpayment is a PIE credit. It reduces any income tax payable and any remaining credit is refunded, so the $1,890.00 is recoverable.
The growth is not. Because the tax was taken out of the fund, it never earned anything. At 5.00% the $1,890.00 would have been $2,052.02 by the end of the most recent year, so $162.02 is permanently gone even after a full refund.
The Error Runs Both Ways
The version that costs you money is the rate that was too high. The version that surprises people is the rate that was too low.
Inland Revenue's position on an underpayment is that it becomes a PIE debt added to the income tax you have to pay. Someone who left 10.5% running while their income supported 28% owes the 17.5 percentage point difference on every dollar of attributed PIE income. On the same $18,000.00 that is $3,150.00 payable, not receivable.
This is worth knowing before you go looking. Checking an old KiwiSaver PIR can produce a bill rather than a refund, and either way you are better off knowing.
Why KiwiSaver Is Where It Hides
KiwiSaver accounts are frequently opened at the start of a working life, at a student or first-job income, and a 10.5% rate is genuinely correct at the time. Fifteen years later the income is different and the rate is not.
Employer-arranged sign-ups are the other source, because a rate often gets applied without the member choosing one at all.
The compounding effect is what makes KiwiSaver the expensive case. It is usually the largest PIE balance a person holds and the one held longest, so the attributed income is largest exactly where the rate is most likely to be stale. Our KiwiSaver calculator shows what a difference in the net return does across a working life.
The PIR Test Is Not Your Tax Rate
There are three prescribed investor rates, 10.5%, 17.5% and 28%, and the top one is a cap. Income tax rates go to 39%.
The test looks at the last two income years and takes the more favourable result. You qualify for 10.5% if in either year your taxable income was $15,600 or less and your taxable income plus PIE income was $53,500 or less. You qualify for 17.5% if your taxable income was $53,500 or less and the combined figure was $78,100 or less. Otherwise it is 28%.
The detail that catches people is that PIE income counts in the test, so a strong year in a large KiwiSaver balance can push you into a higher band on its own. Our PIR rate calculator runs the test properly.
Fix It Once, With Every Provider
The rate is set per provider, not centrally. If you hold a KiwiSaver account, a managed fund and a PIE savings account, all three need updating, and changing one does nothing to the others.
It is usually a single field in the provider's app or online account. Inland Revenue does notify providers where it thinks a rate is wrong, but treat that as a backstop rather than the mechanism.
Once the rate is right, the wrapper does what it is supposed to. Our PIE savings vs bank savings calculator shows what a correct PIR is worth against an ordinary account taxed at your marginal rate.
Related NZ PIE and Tax Calculators
- PIE PIR Rate Calculator: work out the rate that should apply to you.
- PIE Savings vs Bank Savings Calculator: what a correct PIR is worth.
- KiwiSaver Calculator: what a change in net return does over a working life.
- Marginal Tax Rate Calculator: the rate that applies to your next dollar of income.
- RWT on Interest Calculator: tax on interest outside a PIE.
Related calculators
- PIR / PIE Tax Rate Optimiser NZ: PIE vs Non-PIE After Tax.
- Property Deal Analyser NZ 2026/27: underwrite A Rental In One Screen.
- NZ Property Sale Tax Triggers Calculator 2026: free NZ property sale tax calculator covering ALL land sale provisions.
- Proposed 45% Top Tax Rate Calculator NZ: What Would It Cost You?
- PIE Savings vs Bank Savings Calculator NZ 2026/27: Free NZ calculator comparing a PIE savings account taxed at your PIR against an ordinary bank savings account taxed a...
How to work out what a wrong prescribed investor rate cost you
- Find your annual PIE tax certificates. Every PIE sends one after 31 March. It shows the PIE income attributed to you for the year, the PIR applied and the tax deducted. KiwiSaver providers issue them too, and KiwiSaver is the most common place a wrong PIR sits unnoticed.
- Enter the PIE income for each year. Copy the attributed PIE income, not the tax. If you hold more than one PIE, add the figures together for each year. Leave a year blank if you held nothing.
- Enter the PIR that was actually applied. This is on the certificate. If it changed part way through the period, run the affected years separately.
- Work out the PIR that should have applied. The rate is set by your income across the previous two years, using both taxable income and PIE income, and it is capped at 28 percent. Confirm it properly rather than guessing, because guessing is what caused the problem.
- Read the direction of the error. If your rate was too high you overpaid, which produces a PIE credit that reduces income tax with any remainder refunded. If it was too low you underpaid, which produces a PIE debt added to the income tax you owe.
- Fix the rate before anything else. Recovering past years does nothing if the same wrong rate keeps running. Update the PIR with every provider you hold a PIE with, then deal with the history.