NZ vs USA Tax — Federal Brackets, Take-Home & KiwiSaver vs 401(k) (2025)

Retirement: KiwiSaver vs 401(k)

KiwiSaver uses mandatory auto-enrollment (workers aged 18–65 are auto-enrolled by default but can opt out within the first few weeks). Employee contribution options are 3%, 3.5%, 4%, 6%, 8%, 10% of gross pay. Employer minimum is now 3.5% — up from 3% before 1 April 2026, and rising again to 4% on 1 April 2028. Contributions are deducted from after-tax pay; employer contributions are subject to ESCT. Growth is taxed annually at the member's PIR (10.5%, 17.5%, or 28%).

401(k) plans are entirely voluntary and employer-sponsored. The 2025 employee contribution limit is $23,500 ($31,000 for age 50+). Contributions are made pre-tax, directly reducing taxable income. Employer matches typically range from 3%–6% of salary, but vesting schedules commonly require 2–6 years. Growth is tax-deferred until withdrawal (taxed as ordinary income in retirement). A Roth 401(k) variant accepts after-tax contributions but allows tax-free withdrawals.

At an $80,000 salary: the default KiwiSaver employee + employer contribution is $5,600/year (3.5% + 3.5%). A US worker maxing employer match at 6% with a 6% personal contribution would accumulate $9,600/year — but the personal portion is pre-tax, reducing their taxable income by $4,800.

If you're moving NZ → USA

• Visa types: Common pathways include H-1B (specialty occupation lottery), O-1 (extraordinary ability), L-1 (intracompany transfer), or E-3 (available to Australians, not New Zealanders — NZ nationals must use H-1B or O-1). The TN visa is for Canadians and Mexicans only.
• US tax residency: Triggered either by obtaining a Green Card or by passing the Substantial Presence Test (183 days in the current year, counting 1/3 of prior-year days and 1/6 of the year before). Once resident, you file Form 1040 on worldwide income.
• Citizenship-based taxation warning: Unlike New Zealand, the US taxes its citizens worldwide regardless of residency. If you become a US citizen, you must file annually even if you later return to NZ. Renouncing citizenship triggers an exit tax if assets exceed thresholds.
• FBAR (FinCEN 114): US persons with foreign financial accounts totalling US$10,000 or more at any point in the year must file an FBAR. Your NZ bank accounts, KiwiSaver balance, and NZ investment accounts all count. Due date: April 15 (automatic extension to October 15).
• FATCA Form 8938: Separately required if foreign assets exceed $50,000 (single, US-based) or $200,000 (single, abroad) at year end. Thresholds double for married filing jointly. This is filed with your Form 1040, not separately like the FBAR.
• KiwiSaver while abroad: Voluntary contributions can continue. Your NZ KiwiSaver balance may be treated as a foreign trust by the IRS — consult a US-qualified tax adviser before leaving.

If you're moving USA → NZ

• NZ tax residency: Triggers after 183 days in any 12-month period, or immediately if you have a permanent place of abode in NZ. Once NZ-resident, IRD taxes worldwide income.
• US citizens still file Form 1040: US citizenship means you continue to file with the IRS annually regardless of where you live. The Foreign Earned Income Exclusion (FEIE) shelters approximately $130,000 of NZ employment income in 2025, and the Foreign Tax Credit (FTC) allows NZ tax paid to offset US tax due — usually eliminating double taxation on salary income.
• 401(k) and IRA balances: Retaining US retirement accounts while NZ-resident can trigger NZ's Foreign Investment Fund (FIF) rules. IRD may tax the notional return on these balances annually (using the Fair Dividend Rate or Comparative Value method) — even if no distributions are taken. Seek specialist NZ-US tax advice before relocating.
• Roth IRA: NZ does not recognise the Roth IRA's tax-exempt status. Growth in a Roth IRA held by an NZ resident may be subject to NZ FIF taxation. This is an active grey area — professional advice is strongly recommended.
• Lower payroll deductions: US workers accustomed to FICA at 7.65% will find NZ's ACC levy at 1.67% much lighter. However, NZ has no equivalent of US Social Security at retirement — NZ Superannuation (age 65+) is funded from general taxation.
• NZ has no estate or inheritance tax: Large estates transferred to NZ heirs face no NZ tax on inheritance, though they may still face US estate tax if the deceased was a US person.