
Years
85
Branches
1
Partners
80
Staff
70
Minimum wage increase
The adult minimum wage will rise from $23.15 to $23.50 per hour, and the starting-out and training minimum wage will increase from $18.52 to $18.80 per hour.
If an employee is aged 16 or over, the employee must be paid at least the minimum wage. There are 3 types of minimum wage:
An employee’s age and work situation determine their minimum wage. Employees aged 16 and over must be paid at least the adult minimum wage, unless they’re starting out or a trainee. Employees under 20 may be entitled to the starting-out wage, depending on their circumstances. Employees aged 20 or over, completing 60 credits of industry training, must be paid at least the training wage.
ACC Earners Levy
PAYE calculations also include the ACC Earners’ Levy. The ACC Earners’ Levy will increase from 1.60% to 1.67% as of 1 April 2025. This means all employees will see a small increase in the amount of tax deducted from their pay, and therefore a small decrease in the net amount they receive after tax.
The ACC Earners’ Levy does not apply to earnings over a threshold, and that threshold is increasing to $152,790. That means the maximum levy someone could pay in the 2025/26 year is $2,551.59.
ESCT thresholds
ESCT stands for Employer Superannuation Contribution Tax. Typically you’ll see this as the tax that is applied to the employer contribution for KiwiSaver. These thresholds are increasing from 1 April. Nothing you need to do here – this is only really noticeable if you look at how the employer contribution is split between this tax and the net value the employee receives to their KiwiSaver.
Tax on extra pays
The IRD has specified a new method for calculating the thresholds used to determine the tax rate used for lump sum payments when they relate to the end of employment. These specifications are currently in draft, so we may still see further changes – this can be somewhat confusing and we recommend you reach out to our payroll team for assistance when you have a final pay to calulate.
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Please contact our payroll team if you need any support or advice.
Waikato Chartered Accountants and Business Advisors for Life.
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PO Box 23,
Morrinsville 3300
Phone: 07 889 7153
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PO Box 51,
Matamata 3400
Phone: 07 888 8002
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Thames 3500
Phone: 07 868 9945
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Phone: 07 595 0351
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