Income tax (rates / brackets)

New Zealand's income tax system uses progressive tax brackets that determine the amount of tax withheld from employee wages. As of 1 April 2024, the standard tax brackets are 10.5% on income up to NZ$14,000, 17.5% on income between NZ$14,001 and NZ$48,000, 30% on income between NZ$48,001 and NZ$70,000, and 33% on income above NZ$70,000. An additional 2% ACC (Accident Compensation Corporation) levy applies to all earners.

Income tax in New Zealand is governed by the Income Tax Act 2007 and administered by Inland Revenue (Te Tari Tāke). The tax system applies to all residents and non-residents earning New Zealand-sourced income, including wages, salaries, and other employment income.

The tax brackets are indexed annually on 1 April to account for inflation. The most recent adjustment on 1 April 2024 increased all threshold values to reflect cost-of-living changes. Employers must apply these rates when calculating PAYE (Pay As You Earn) deductions from employee salaries.

Payroll teams must ensure they withhold the correct tax amount based on each employee's income level and tax code. Employees receive a tax code from Inland Revenue that reflects their personal circumstances, and this code must be used to calculate accurate deductions. Employers are required to remit withheld taxes to Inland Revenue by the 20th of the following month. Failure to withhold or remit correctly can result in penalties and interest charges, making accurate bracket application essential for compliance.