KiwiSaver Contribution Guide: Rates, Employer Contributions & Tax

KiwiSaver is New Zealand’s voluntary workplace savings scheme, designed to help Kiwis save for retirement and their first home. Here’s a complete guide to how contributions work.

Employee Contribution Rates

You can choose to contribute 3%, 4%, 6%, 8%, or 10% of your gross salary. The rate is applied to your full salary before tax.

Rate	On $60,000 salary
3%	$1,800/year
4%	$2,400/year
6%	$3,600/year
8%	$4,800/year
10%	$6,000/year

Your contribution is deducted from your gross pay, which reduces your take-home pay.

Employer Contributions

Your employer must contribute a minimum of 3% of your gross salary. Most employers contribute exactly 3% — some offer more as a benefit.

Note: employer contributions are subject to Employer Superannuation Contribution Tax (ESCT), which reduces the net amount that lands in your fund.

ESCT — The Hidden Tax on Employer Contributions

ESCT is a tax on employer KiwiSaver contributions, paid by the employer. The effective rate depends on your income:

Employee income	ESCT rate
Up to $16,800	10.5%
$16,801–$57,600	17.5%
$57,601–$84,000	30%
$84,001–$216,000	33%
Over $216,000	39%

Total Contributions

Example: $70,000 salary, 4% employee rate

• Employee: $70,000 × 4% = $2,800
• Employer (gross): $70,000 × 3% = $2,100
• ESCT on employer (at 30%): $630 deducted
• Employer net to fund: $1,470
• Total to fund: $4,270/year

Choosing Your Contribution Rate

A higher rate means faster retirement savings growth, but less take-home pay. Consider:

• Can you afford to reduce your take-home pay?
• Are you saving for a first home (you’ll need 3+ years in KiwiSaver)?
• Does your employer match beyond 3%?

KiwiSaver and First Home Purchases

After contributing to KiwiSaver for 3+ years, you may be able to withdraw savings for a first home deposit. Check the eligibility criteria with your KiwiSaver provider.

Use our KiwiSaver Calculator to see your contributions at any rate.