KiwiSaver Contributions - Gross or Net?

KiwiSaver contributions can be confusing and it’s a common question to ask if your contribution (and your employer’s 3.5% contribution) is calculated on your gross salary or salary after tax - in this guide, we explain everything you need to know

Updated 6 April 2026

Summary:

Employee KiwiSaver contributions are paid after tax; effectively money what would have gone to your bank account is paid instead into your KiwiSaver fund.
Employer KiwiSaver contributions are paid before tax; how much tax you pay depends on your income.

This is best explained is an example:

if you contribute 3.5% to your KiwiSaver and your gross salary each week is $1,500 ($78,000 a year), you can see how much tax and ACC you'll pay using our PAYE calculator.
You can compare the money saved from not contributing using the same calculator and unchecking the KiwiSaver box.

KiwiSaver Contributions Explained in Detail

How KiwiSaver is taxed - and what portion of your salary you get to keep

To make things simple, both your salary contribution (known as the ‘employee contribution’) and the employer's contribution are calculated on your gross salary.
Gross salary includes allowances, bonuses, commission, extra salary, overtime, gratuities and remuneration of any kind (before tax).
Let’s take an example. If your base salary is $40,000, but you earn $10,000 in overtime, $5,000 of commission and $5,000 as a bonus, your gross salary is $60,000. Your employer and employee contributions (and tax rates) are then calculated on this amount.

How do KiwiSaver deductions work in practice, and where does tax come in?

Your employee contributions, calculated on your gross income, are deducted from your net income (after PAYE is deducted). This means that the total PAYE you pay won’t be affected by your KiwiSaver contributions. In simple terms, the amount is re-directed from your bank account to your KiwiSaver fund given you’ve paid tax already.
Your employer’s contributions are also taxed, and the rate is based on how much you earn. The tax rate ranges from 10.5 per cent to 39 per cent, depending on how much you earn per year. This is called Employer superannuation contribution tax (ESCT) is deducted before the money is paid to an employee’s KiwiSaver fund. These are presented in the table below:

Employee’s annual income	Employer superannuation contribution tax (ESCT) rates
$0 to $18,720	10.5%
$18,721 to $64,200	17.5%
$64,201 to $93,720	30%
$93,721 to $216,000	33%
$216,001+	39%

Source: Business.govt.nz

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