Where does your salary go?
A practical guide to income tax, ACC and your take-home pay.
Your gross salary is the amount before deductions. Your take-home pay is the amount left after income tax and other applicable deductions. A comparison between job offers is more useful when you look at both amounts.
Income tax is progressive
For the 2026/27 tax year, income is split into bands. The first $15,600 is taxed at 10.5%; the next slice up to $53,500 at 17.5%; the next slice up to $78,100 at 30%; the slice up to $180,000 at 33%; and income above that at 39%. Moving into a higher band does not apply that rate to all your earnings.
ACC is a separate deduction
The earners’ levy used here is 1.75% on salary and wages up to $156,641 for 1 April 2026 to 31 March 2027. This is an employee estimate, not a self-employed ACC invoice calculation.
Why your payslip may differ
Our main tool spreads steady annual earnings over the year. Payroll rounding, changes in pay, secondary jobs, tailored tax codes, unpaid leave and lump sums can change actual deductions. KiwiSaver contributions and student loan repayments also change what reaches your bank account.
Start with your gross salary, choose your contribution rate and confirm whether you have a student loan. Use the detailed breakdown to see the effect of each deduction separately.
Walk through one complete example
Use $75,000 as a full-year cash salary. Leave the optional credit and loan off and choose no KiwiSaver contribution. The individual deductions are easier to understand before adding special circumstances.
| Annual gross | Income tax | ACC | Employee KiwiSaver | Student loan | Annual net |
|---|---|---|---|---|---|
| $75,000.00 | $14,720.50 | $1,312.50 | $0.00 | $0.00 | $58,967.00 |
The net result is $58,967, not $75,000 minus one universal percentage. Dividing it by twelve gives an average monthly amount of $4,913.92. These are different views of the same annual estimate; they do not recreate a particular employer’s payroll rounding.
Change one assumption at a time
Repeat the calculation with 3.5% KiwiSaver. The employee deduction increases by $2,625 and the annual cash result falls by the same amount. Income tax does not become smaller merely because you save through KiwiSaver. Now add a student loan separately so you can see which line explains the next change.
Check your comparison before drawing a conclusion
Make sure both amounts cover the same period. Do not compare a monthly net estimate with a four-week payslip. Check whether an offer states cash salary or a package including employer contributions. Keep irregular bonuses separate from a steady-pay illustration. If an expected deduction is missing, review the inputs rather than assuming your employer has made an error.
A useful saved scenario records the salary, year and selected deductions in its name. That makes it easier to revisit an offer without losing track of which assumptions produced the number.
Questions or corrections?
Send the relevant page and a non-sensitive example through our contact form. Read our calculation methodology to see the scope of the model.