Payroll obligations are changing from 1 April 2026

Payroll obligations are changing from 1 April 2026

KiwiSaver contribution changes

The default KiwiSaver contribution rate is increasing from 3% to 3.5% for both employees and employers. This will apply to all paydays on or after 1 April 2026, meaning both employee deductions and employer contributions will increase automatically.

There are a few additional points to be aware of:

• Employees may apply for a temporary reduction in contributions to 3% for a period of 3–12 months. In such cases, the employer contribution may also be reduced to the corresponding level.
• Employer KiwiSaver contributions will now also apply to eligible 16/17 year olds

See more from the IRD here.

Minimum wage increase

The adult minimum wage is increasing to $23.95 per hour, with starting-out and training wages increasing to $19.16 per hour. This applies to all hours worked from 1 April, regardless of when the pay is processed, so it’s important your payroll is updated accordingly.

What this means for your business

These changes may seem straightforward, but they can have wider impacts:

• Check that your payroll systems and settings are updated before your first April pay run
• Employment agreements and pay structures may need to be reviewed (especially for staff that are being paid close to minimum wage)
• Increased employer costs due to higher KiwiSaver contributions
• Communication with staff around changes to their take-home pay, including that if they wish to apply for a temporary reduction in contributions, this must be done by them through their  myIR account

How we can help

Our team can support you with:

• Reviewing and updating your payroll systems
• Ensuring compliance with minimum wage and KiwiSaver obligations
• Assessing the impact on your wage structure and business costs
• Ongoing payroll processing and tax compliance support

Talk to our experts

If you’d like help navigating these changes or want to ensure everything is set up correctly, get in touch with our team.

About Nexia New Zealand

Nexia New Zealand is one of New Zealand’s leading full-service chartered accounting and business advisory consultancy firms, offering the full range of chartered accounting, business advisory, corporate advisory, tax and audit services. 

Nexia New Zealand has four offices throughout New Zealand: Victoria Street in Christchurch, Albany on Auckland’s North Shore, Newmarket in the Auckland CBD and Hastings in Hawke’s Bay.