Shareholder Salary Tax Calculator

This calculator estimates the income tax on a shareholder-employee salary and compares taking company profit as a salary against leaving it in the company taxed at the 28 percent company rate. In a New Zealand company, owners who also work in the business are often paid a shareholder salary, a way of allocating company profit to themselves that is taxed at their personal rates rather than the flat company rate. Unlike ordinary wages, a shareholder salary frequently has no PAYE deducted during the year, with the tax instead paid through provisional and terminal tax, which makes it easy to underestimate the bill. Deciding how much profit to draw as salary, and how much to retain in the company, is one of the most common tax-planning questions for small business owners, because personal tax is progressive while company tax is a flat 28 percent. This tool helps you see the trade-off. You enter the shareholder salary amount, and the calculator works out the income tax using the current personal tax brackets, the after-tax amount, the effective tax rate, and, for comparison, the 28 percent company tax that would apply if the same profit were retained. The results update as you type, so you can find the level at which drawing salary becomes more or less efficient than retaining profit. Use it to plan owner remuneration, to estimate the tax on a shareholder salary, or to decide how much profit to leave in the company. Because the personal brackets rise to 39 percent above $180,000, drawing very large salaries is taxed more heavily than the 28 percent company rate, while modest salaries are often taxed at a lower average rate. This is an estimate of income tax only, excluding ACC levies and any imputation effects on later dividends; confirm your situation with an accountant.

Uses 2026/27 personal tax brackets. A shareholder salary is taxed at personal rates; retained profit at the 28% company rate. Income tax only; excludes ACC levies and imputation. Confirm with an accountant.