NZ Bonus Tax Calculator
Calculate the tax on your bonus or extra pay for the 2026-27, 2025-26 or 2024-25 tax year. See your net bonus after PAYE, ACC, KiwiSaver, and student loan deductions.
Key Takeaway
There is no special “bonus tax” in New Zealand. Bonuses are taxed at your marginal PAYE rate and are also subject to ACC earner’s levy, KiwiSaver contributions, and student loan repayments if applicable.
Key Facts — 2026-27
Bonus Tax Rate
Marginal rate
ACC Earner’s Levy
1.75%
ACC Cap
$156,641
Student Loan Rate
12%
Net bonus (take-home)
Total deductions
Effective rate on bonus
| Deduction | Amount |
|---|---|
| Income Tax | $2,400.00 |
| ACC Earner's Levy | $140.00 |
| Total Deductions | $2,540.00 |
How Bonus Tax Works in New Zealand
In New Zealand, bonuses are treated as “extra pay” by Inland Revenue (IRD). There is no special bonus tax rate — instead, your employer “grosses up” the bonus by adding it to your annualised regular income, finds the single tax bracket that grossed-up total falls into, and applies that one flat rate to the entire bonus.
Unlike your regular salary, the bonus itself is not split across brackets — even if adding it to your salary pushes your total income past a threshold, the whole bonus is taxed at the single rate for the bracket the grossed-up total lands in. This can make the withholding on a bonus slightly over- or under-shoot your true annual tax liability; IRD’s automatic income tax assessment after 31 March reconciles the difference.
ACC earner’s levy is 1.75%, with a maximum of $156,641 of earnings for 2026-27 (maximum levy $2741.22). The bonus withholding follows IRD’s employer guide IR335: if your salary plus the bonus is at or below the maximum, the levy is withheld on the whole bonus; if it is over, none is withheld. The year-end levy is capped at the maximum liable earnings, so any excess is refunded after the year.
KiwiSaver contributions apply to bonus payments at your chosen employee rate (3.5%, 4%, 6%, 8%, or 10%). Your employer also contributes a minimum of 3.5% on the bonus. KiwiSaver deductions are made before you receive your net bonus, just as they are on regular pay.
If you have a student loan, your employer adds the bonus to your gross pay for that pay period, subtracts the pay-period repayment threshold ($928.00 fortnightly, $2,010.66 monthly for 2026-27) and deducts 12% of the balance (Inland Revenue employer’s guide IR335). The test is per pay period, not against your $24,128 annual threshold, so a bonus attracts a deduction even if your income for the year stays under it. This calculator assumes you are paid fortnightly and shows the part of that pay period’s deduction the bonus adds. If too much is deducted during the year, IRD will adjust this in your end-of-year income tax assessment.
NZ Income Tax Brackets — 2026-27
Your bonus is taxed at the marginal rate determined by your total income (salary + bonus). New Zealand has no personal allowance — tax applies from the first dollar.
| Income Range | Rate | Tax on Band |
|---|---|---|
| $0 – $15,600 | 10.5% | $1,638 |
| $15,601 – $53,500 | 17.5% | $6,632.50 |
| $53,501 – $78,100 | 30% | $7,380 |
| $78,101 – $180,000 | 33% | $33,627 |
| $180,001+ | 39% | — |
Worked Example
Scenario: You earn $70,000 per year and receive an $8,000 bonus. You contribute 4% to KiwiSaver and have no student loan. How much of the bonus do you take home?
Step 1 — Gross up: Add the bonus to your annual salary: $70,000 + $8,000 = $78,000.
Step 2 — Find the bracket: $78,000 falls in the $53,501 – $78,100 band, so the flat rate for this bonus is 30%.
Step 3 — PAYE on the bonus: IRD applies that one flat rate to the whole bonus — it is not split across brackets: $8,000 × 30% = $2,400.00.
Step 4 — ACC earner’s levy: Your total earnings ($78,000) are below the $156,641 cap, so the full bonus is subject to ACC levy: $8,000 × 1.75% = $140.00.
Step 5 — KiwiSaver: At 4%, your employee contribution on the bonus is: $8,000 × 4% = $320.00.
Total deductions on bonus: $2,400.00 + $140.00 + $320.00 = $2,860.00.
Net bonus: $8,000 − $2,860.00 = $5,140.00.
Your effective deduction rate on the bonus is 35.8%.
Frequently asked questions
How are bonuses taxed in New Zealand?
IRD treats bonuses as 'extra pay'. Your employer 'grosses up' the bonus by adding it to your annualised regular income, finds the single tax bracket that grossed-up total falls into, and applies that one flat rate to the WHOLE bonus — it is not split across brackets even if the bonus itself straddles a threshold.
Is there a special bonus tax rate in NZ?
No. New Zealand does not have a separate 'bonus tax' rate. Bonuses are taxed under IRD's 'extra pay' rules at a single flat rate, chosen by which tax bracket your total annualised income (salary + bonus) falls into. The whole bonus is taxed at that one rate — unlike your salary, the bonus itself is not split across multiple brackets. This can occasionally over- or under-withhold slightly versus your true annual liability; IRD's automatic assessment after 31 March reconciles the difference.
Do I pay ACC earner's levy on my bonus?
Yes, unless your annual salary plus the bonus is more than the ACC earner's levy maximum of $156,641 for 2026-27. The levy is 1.75%. Following IRD's employer guide IR335, employers withhold it on the whole bonus when salary plus bonus is at or below the maximum, and withhold none when it is over. The year-end levy is still capped at the maximum, so any excess is refunded after 31 March.
Do I pay KiwiSaver on my bonus?
Yes. If you are enrolled in KiwiSaver, your employee contribution rate (3.5%, 4%, 6%, 8%, or 10%) applies to bonus payments as well as regular salary. Your employer also contributes a minimum of 3.5% on the bonus amount. You cannot opt out of KiwiSaver contributions on individual bonus payments.
Does student loan repayment apply to bonuses?
Yes. Your employer deducts 12% of the pay period's total gross pay — your normal pay plus the bonus — above the pay-period repayment threshold ($464.00 weekly, $928.00 fortnightly or $2,010.66 monthly for 2026-27, i.e. the $24,128 annual threshold split across the pay periods). It is not tested against your annual income, so even a low earner whose year stays under $24,128 has a deduction taken from a large bonus. This calculator assumes fortnightly pay. Over-deductions are refunded after your end-of-year assessment.
Will I get a tax refund at the end of the year?
You may receive a refund if too much PAYE was deducted from your bonus during the year. IRD performs an automatic income tax assessment after 31 March each year. If the extra pay PAYE method resulted in over-deduction, you will receive a refund. You can also check your assessment in myIR.
How does the extra pay PAYE method work?
When your employer pays a bonus, they use IRD's 'extra pay' method: add the bonus to your annualised regular income to get a 'grossed-up' total, find which tax bracket that total falls into, and apply that single flat rate to the entire bonus. The bonus itself is not split across brackets, even if it straddles a threshold. Source: IRD, Calculate PAYE for a lump sum payment.
Can I put my entire bonus into KiwiSaver?
Your standard KiwiSaver employee contribution rate applies automatically to your bonus. If you want to contribute more, you can make voluntary contributions directly to your KiwiSaver provider after receiving the bonus. However, you cannot instruct your employer to deduct more than your chosen rate (3.5%, 4%, 6%, 8%, or 10%) from payroll.
Sources
Related Calculators
Reflects 2026-27 tax year rates.
Related Calculators
Final pay calculator
Net pay when leaving a job — wages, holiday pay and redundancy
Insolvency employee claim
Priority cap for wages, holiday pay and redundancy when an employer fails
Take-home pay
Net pay after PAYE, ACC and KiwiSaver
Reverse salary calculator
Required gross salary to hit a target take-home
Salary raise calculator
Net take-home increase from a pay rise
All New Zealand calculators
Browse every nztax.tools calculator