ESCT Calculator

ESCT is a tax on employer contributions to KiwiSaver and other superannuation schemes. Instead of being taxed as part of your income, employer contributions are taxed at your marginal tax rate through the ESCT system. The tax is deducted before the contribution reaches your KiwiSaver account, so the amount that actually lands in your fund is the net after ESCT.

Your ESCT rate is based on your total salary plus employer KiwiSaver contributions from the previous tax year (1 April to 31 March). Since 1 April 2025 the thresholds are: 10.5% up to $18,720, 17.5% for $18,721–$64,200, 30% for $64,201–$93,720, 33% for $93,721–$216,000, and 39% over $216,000. If you don't have a prior year salary (e.g. new to the workforce), your current year salary plus employer contributions is used instead.

PAYE is deducted from your salary before you receive your pay. ESCT is a separate tax on your employer's KiwiSaver contribution only. Both use marginal tax rates, but PAYE applies to your salary income while ESCT applies only to the employer's contribution amount — and the two use slightly different dollar thresholds. You never receive the ESCT amount; your employer deducts it and pays it to IRD.

Yes. From 1 April 2026, the minimum employer KiwiSaver contribution rose from 3% to 3.5% (Taxation (Budget Measures) Act 2025). The default employee rate for auto-enrolled members also increased from 3% to 4%. Because ESCT applies to the employer contribution, a higher employer rate means more ESCT for the same salary. The employer minimum rises again to 4% from 1 April 2028.

ESCT reduces the amount of employer contributions that actually reach your KiwiSaver account. For example, on a $70,000 salary with a 3.5% employer contribution ($2,450), an ESCT rate of 30% takes $735 and only $1,715 reaches your fund. Over 30+ years of contributions, this tax drag compounds significantly.