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Understanding New Zealand Tax

Understanding New Zealand Tax

When planning your future in New Zealand, it’s important to understand how the tax system works. Personal income tax is charged on every dollar you earn, businesses pay a single rate business tax and most purchases contain an element of GST (Goods and Services Tax).

Current Rates:

Personal Income Tax:

  • 19.5% for income up to $38,000 per annum
  • 33% is taxed on income between $38,001 - $60,000 per annum
  • 39% is taxed on all income above $60,000

How do you work this out?
If your salary is $45,000 per annum, the tax you would pay would be 19.5% on the first $38,000, and 33% on the remaining $7,000.

For a higher salary of $90,000, you would pay 19.5% on the first $38,000, 33% on the next $22,000 and then 39% on the remaining $30,000.

You can work out your salary on our calculator here: Pay Calculator

Personal income is also subject to an ACC (Accident & Compensation Claims) levy. The current rate is $1.30 per $100 earnt, on a salary up to $96,619 per annum. You can find out more by clicking here.

GST Rate: 12.5%

Business Income Tax Rate: 33%

You can find more information about tax on the Inland Revenue website.