ESCT (Employer Superannuation Contribution Tax) Explained
ESCT — Employer Superannuation Contribution Tax — is the tax employers deduct from their own cash contributions to an employee's superannuation, including compulsory KiwiSaver contributions, before the money lands in the employee's account. The employer pays ESCT to Inland Revenue; the rate (10.5% to 39%) is set by the employee's total remuneration. This page covers the current rate bands, how the threshold is calculated, and a worked KiwiSaver example.
ESCT rate thresholds (from 1 April 2025)
The ESCT rate is found by looking up the employee's ESCT rate threshold amount in this table. The bands below took effect on 1 April 2025:
- $0 – $18,720: 10.5%
- $18,721 – $64,200: 17.5%
- $64,201 – $93,720: 30%
- $93,721 – $216,000: 33%
- $216,001 and above: 39%
Each employee gets a single ESCT rate for the year based on which band their threshold amount falls into.
How the ESCT rate threshold amount is worked out
The ESCT rate threshold amount is the employee's gross salary or wages plus the employer's superannuation cash contributions from the previous tax year (1 April to 31 March).
For a new employee — or anyone who didn't work for you the whole prior year — you instead estimate their current-year salary or wages plus expected employer contributions, and use that estimate to pick the band. You set the ESCT rate at the start of the tax year and keep it for the full year.
How ESCT is deducted from KiwiSaver contributions
ESCT comes out of the employer's contribution, not the employee's own KiwiSaver deduction. The minimum compulsory employer KiwiSaver contribution is 3.5% of gross pay. ESCT is calculated on each whole dollar of that employer contribution at the employee's ESCT rate, and only the after-ESCT amount is paid into the employee's KiwiSaver account.
Because the rate rises with income, higher earners see a larger slice of the employer contribution taken in ESCT — though the employer still pays at least the 3.5% minimum gross.
Worked example
Say an employee earns $70,000 and the employer contributes the minimum 3.5% to KiwiSaver.
- Employer contribution = 3.5% × $70,000 = $2,450.
- The employee's ESCT rate threshold amount (roughly salary + prior employer super) falls in the $64,201–$93,720 band, so the ESCT rate is 30%.
- ESCT = 30% × $2,450 = $735.
- Net amount into the KiwiSaver account = $2,450 − $735 = $1,715.
An employee on $50,000 would instead fall in the 17.5% band, so a 3.5% ($1,750) employer contribution would have only $306.25 of ESCT, leaving $1,443.75 in their account.
Estimate your KiwiSaver with ESCT
Use the calculators below to project your KiwiSaver balance and see how employer contributions (after ESCT) and your own pay deductions add up over time.
KiwiSaver Calculator
Project your KiwiSaver balance including employer contributions, the government contribution, and investment growth.
Take-Home Pay Calculator
See your KiwiSaver deduction alongside PAYE, ACC levy and student loan on your gross pay.
Income Tax Calculator
Check the income tax brackets your ESCT rate threshold amount mirrors for 2025-26.
Related Terms
KiwiSaver
KiwiSaver is New Zealand's voluntary workplace savings scheme designed to help you build a retirement fund.
IRD
Inland Revenue Department (IRD), commonly known as Inland Revenue or simply IRD, is the New Zealand government agency responsible for collecting taxes, distributing social support payments, and enforcing tax compliance.