NZ Salary vs Dividend Calculator
Salary or dividends? See which route nets you more — and the optimal mix. Compares PAYE salary (with ACC + KiwiSaver employer cost) against fully-imputed dividends from your NZ company.
KiwiSaver + other income + tax year
If on, employer 3% (3.5% from 2026-27) is added to your salary cost.
How NZ company remuneration works
As an owner-operator of an NZ company, you have two routes to take profit out: pay yourself a salary (PAYE-taxed at your personal progressive rate) or retain the profit, pay 28% company tax, then distribute the rest as a dividend with imputation credits attached.
The salary route adds two costs the dividend route avoids: ACC earner levy (1.67% in 2025-26 / 1.75% in 2026-27, capped at the salary cap) and the KiwiSaver employer minimum (3% in 2025-26 / 3.5% from 1 April 2026) on top of your salary if you're a KiwiSaver member.
The dividend route uses imputation credits: the company pre-pays tax at 28% on the profit, and that credit transfers to you so you only top up the gap to your marginal rate (or get nothing back if your marginal rate is below 28% — credits can't be refunded but carry forward).
The optimal mix is usually a blend: pay yourself enough salary to use up the 10.5% and 17.5% brackets (where personal tax is below 28%), then distribute the rest as dividends. The calculator above finds the maximum-net-in-pocket point given your specific numbers.
Frequently asked questions
Should an NZ company owner pay themselves salary or dividends?
It depends on your marginal tax rate. If your personal rate is below 28% (i.e. taxable income under ~$53,500), salary tends to win because you avoid company tax on that slice. Above that, dividends often win because the 28% company tax + imputation pass-through is lower than your 30% / 33% / 39% marginal rate. KiwiSaver and ACC change the breakeven — use the calculator above to see your specific numbers.
Why does the dividend route sometimes save tax?
Dividends carry imputation credits — the company pre-paid tax at 28%, and you get credit for that against your personal tax bill. If your marginal rate is 30%, 33%, or 39%, you only top up the gap. Dividends also avoid ACC levy and KiwiSaver employer cost, which add up to ~5% of salary at the cap.
What are imputation credits and how do they work?
When an NZ company pays 28% income tax on its profit, the after-tax distribution to shareholders carries imputation credits at the ratio 28/72 — that is, $0.389 of credit per dollar of cash dividend. You declare the cash dividend grossed-up by the credits, pay your personal tax on the grossed-up amount, then claim the credits as an offset. Net effect: tax on the company profit happens once, at your marginal rate.
Do I pay ACC levy on dividends?
No. ACC earner levy applies only to PAYE-taxed income (wages and salary). Dividends are not earner-levy-bearing, so a dividend route saves you 1.67% (2025-26) or 1.75% (2026-27) up to the cap.
Do I have to pay KiwiSaver as an owner-operator?
Only on the salary portion. If you take dividends, no KiwiSaver applies. If you pay yourself salary and you're a KiwiSaver member, the company must contribute the employer minimum (3% in 2025-26, 3.5% from 1 April 2026) on top of your salary — and you contribute your chosen rate (3% / 4% / 6% / 8% / 10%) deducted from the salary.
What's the optimal salary-dividend mix?
Usually a blend: pay yourself enough salary to use up the lower brackets (10.5% and 17.5%) where personal tax is below the 28% company rate, and distribute the rest as dividends. The exact split depends on your other income and KiwiSaver participation — the calculator above grid-searches for the maximum net-in-pocket.
Sources
Last updated April 2026. Brackets, imputation ratio, ACC, and KiwiSaver rates sourced from IRD.