PIR
Your Prescribed Investor Rate (PIR) is the tax rate applied to income earned from Portfolio Investment Entities (PIEs), including KiwiSaver funds, PIE term deposits, and managed funds. The three PIR rates are 10.5%, 17.5%, and 28%.
Your correct PIR depends on two figures for each of the last two income years: your taxable income excluding PIE income, and your taxable income including PIE income (you use whichever of the two years gives the lower rate). For 2026-27: if your taxable income excluding PIE was $15,600 or less AND your income including PIE was $53,500 or less, your PIR is 10.5%. If your taxable income excluding PIE was $53,500 or less AND your income including PIE was $78,100 or less, your PIR is 17.5%. Otherwise, your PIR is 28%.
These thresholds are set by the Income Tax Act 2007 schedule 6, table 1 — a different instrument from the PAYE income tax brackets, even though the Taxation (Budget Measures) Act 2024 raised them to the same cutoffs from the 2025-26 income year. For the 2024-25 year they were still the older $14,000 / $48,000 / $70,000 ladder.
It's critical to use the correct PIR. If you use a rate that's too low, IRD will charge you the difference. If you use a rate that's too high, you cannot get a refund — the overpayment is lost. You should review your PIR each year, especially if your income has changed, and update it with your KiwiSaver or fund provider.
How it works
The two-year lookback exists to smooth out one-off income spikes. Because you use whichever of the last two income years gives the lower PIR, a single year with unusually high income — say from a redundancy payment or a one-off bonus — won't permanently push your rate to 28% forever; the earlier, more typical year can still qualify you for a lower band as long as it falls within the two-year window.
Working out your PIR is your responsibility, not your provider's or IRD's. Providers apply whatever rate you've told them, so if your income changes, you need to proactively check whether a different band now applies and notify your provider — IRD's online PIR tool can help you work out the correct rate before you update it.
The PIR thresholds ($14,000 / $48,000 / $70,000) apply across every type of PIE investment you hold — KiwiSaver, PIE term deposits, and PIE managed funds all use the same personal PIR, so you only need to work out one rate and give it to each provider, not a different rate per product.
Example: working out a PIR using the two-year test
Jordan's taxable income excluding PIE income was $45,000 last year and $52,000 the year before that. Including PIE income, those figures were $52,000 and $60,000 respectively.
Using last year's figures: income excluding PIE ($45,000) is at or below $48,000, and income including PIE ($52,000) is at or below $70,000 — so last year qualifies Jordan for the 17.5% band.
Using the year before: income excluding PIE was $52,000, which is above the $48,000 cutoff for both the 10.5% and 17.5% bands, so that year alone would only support the 28% rate.
Since Jordan can use whichever year gives the lower rate, and last year supports 17.5%, Jordan's correct PIR is 17.5%.
Frequently asked questions
Does my PIR update automatically if my income changes this year?
No — your PIR is based on your income from the two previous tax years, not your current year's income, so a change in your earnings this year won't affect your PIR until it becomes one of the two lookback years; you still need to check and update it yourself if it changes.
Where do I find or change my PIR?
Ask your KiwiSaver or PIE fund provider directly, since they hold your elected PIR on file and apply it to your PIE income — you can also use IRD's online PIR tool first to confirm which rate applies to you before updating your provider.
Does everyone invested in the same PIE fund pay the same rate?
No — a multi-rate PIE, which includes most KiwiSaver funds, taxes each investor's share of the fund's income at that investor's own individually elected PIR, so two people in the same fund can pay different effective tax rates on the identical underlying return.
Related Terms
PIE
A Portfolio Investment Entity (PIE) is a type of managed investment fund that is taxed at the investor's Prescribed Investor Rate (PIR) rather than the standard income tax rates.
KiwiSaver
KiwiSaver is New Zealand's voluntary workplace savings scheme designed to help you build a retirement fund.
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