New Zealand has a relatively simple tax system compared to many countries. Here's what you need to know about paying tax as a newcomer.
Getting an IRD Number
An IRD number is your personal tax identification number with Inland Revenue (IRD). You need one to work, get paid, open an interest-bearing bank account, or receive government support.
- Apply online at ird.govt.nz (the myIR system).
- You'll need your passport and your visa details.
- Processing takes 2–10 working days. You can start work without it — your employer will use a higher tax rate (13.5% or specified) until you provide it.
How PAYE Works (Pay As You Earn)
If you're an employee, tax is deducted automatically from your pay. Your employer calculates the tax based on your tax code and pays it directly to Inland Revenue. You don't need to file a tax return unless you have additional income.
Tax Codes
The most common tax codes for newcomers:
- M: Main job, no student loan (use this for your primary employment)
- ME: Main job, with an exemption — same as M but $52 tax credit claimed through your employer
- SB: Secondary job (you already have a main job)
- S: Secondary job, no student loan
- ST: Secondary job — use this if your secondary income will be over $14,000/year
- CAE: Casual agricultural or election work
- WT: Withholding tax — used by contractors who haven't provided an IRD number
If you're a contractor or freelancer, you pay tax through provisional tax (paying in instalments) and file an annual tax return (IR3).
Tax Rates (2025–2026)
| Income Bracket | Tax Rate |
|---|---|
| Up to $14,000 | 10.5% |
| $14,001 to $48,000 | 17.5% |
| $48,001 to $70,000 | 30% |
| $70,001 to $180,000 | 33% |
| $180,001 and over | 39% |
New Zealand has no capital gains tax (except for certain investment properties), no inheritance tax, and no stamp duty on property transfers.
Transitional Tax Provisions for Newcomers
- Your tax residency starts when you have a "permanent place of abode" in NZ or when you've been in NZ for 183+ days in any 12-month period.
- For the first 4 years of tax residency, most foreign income (e.g., overseas pensions, rental income from overseas property) is exempt from NZ tax under the "transitional residency" rules.
- Overseas superannuation (pension) transfers to NZ are generally not taxed if transferred within 4 years of becoming a NZ tax resident.
- If you keep assets overseas and sell them after becoming a NZ tax resident, you may need to pay tax on the gain. Get professional advice.
Filing a Tax Return
Most employees don't need to file a tax return — Inland Revenue automatically assesses your tax position at the end of each tax year (1 April to 31 March) and will notify you if you're owed a refund or owe extra tax.
You should file a return (IR3) if you:
- Are self-employed or a sole trader
- Rent out property
- Have overseas income not already taxed
- Want to claim deductions or expenses
- Have been told to file by Inland Revenue
KiwiSaver
KiwiSaver is a voluntary retirement savings scheme. As an employee:
- You choose your contribution rate: 3%, 4%, 6%, 8%, or 10% of your gross pay
- Your employer contributes 3% (mandatory minimum)
- The government contributes up to $521 per year (as of 2025) if you're between 18–64
- You can access your KiwiSaver funds when you turn 65, buy your first home, or under certain hardship or serious illness conditions
- You can choose your KiwiSaver provider and fund type (conservative, balanced, growth)
Tax Help and Resources
- Inland Revenue website — all official forms and information
- myIR — online portal for managing your tax and KiwiSaver
- 0800 775 247 — Inland Revenue contact centre
- Citizens Advice Bureau — free advice (local branches)
- Consider hiring a tax agent or accountant for your first tax return