ESCT (Employer Superannuation Contribution Tax) is a tax paid by employers on their KiwiSaver contributions for employees. It exists to ensure those contributions are taxed at a rate similar to the employee's marginal income tax rate. The employer pays both the KiwiSaver contribution AND the ESCT on top, both of which are tax-deductible expenses for the business.

How is the ESCT rate determined?

The ESCT rate is based on the employee's prior year salary PLUS the employer's expected KiwiSaver contributions for the current year. The brackets for 2026/27 are: 10.5% (under $18,720), 17.5% ($18,721-$64,200), 30% ($64,201-$93,720), 33% ($93,721-$216,000), and 39% (over $216,000). For a new employee, use a reasonable estimate of expected annual income.

Do ESCT thresholds change each year?

ESCT thresholds were updated on 1 April 2025 to align with the revised personal income tax brackets that took effect that year. The thresholds are unchanged for 2026/27. Going forward, ESCT thresholds typically only change when personal income tax brackets are adjusted by Parliament.

Is ESCT tax-deductible?

Yes. ESCT is a deductible expense for the employer, like any other employment-related cost. The employer claims a deduction for both the KiwiSaver contribution AND the ESCT on top in their company / business income tax return. This effectively reduces the after-tax cost of providing KiwiSaver contributions to employees.

NZ ESCT Calculator 2026/27

ESCT (Employer Superannuation Contribution Tax) is one of the most-misunderstood payroll taxes in NZ. It's paid by employers on top of their KiwiSaver contributions, and the rate (10.5% to 39%) depends on the employee's prior year earnings PLUS expected employer contributions. This calculator finds the correct tier, calculates the ESCT amount, and shows the total combined cost of providing KiwiSaver to that employee.

Updated April 2026 ESCT thresholds unchanged for 2026/27 (last updated 1 April 2025).

Employee details

Employee's prior year gross salary (12 months ending 31 March)

For new employees, use the expected annual salary. The lookup uses the prior year as a known fixed value. Employer KiwiSaver contribution rate

Current year salary (for KiwiSaver contribution calculation)

Prior year earnings + employer KS	ESCT rate
$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%
Over $216,000	39%

How ESCT works

When an employer contributes to an employee's KiwiSaver, the contribution is taxed at the ESCT rate. Unlike PAYE (which the employee pays), ESCT is paid by the EMPLOYER on top of the contribution. So a 3.5% KiwiSaver contribution on an $80,000 salary is $2,800, plus 30% ESCT of $840, total cost to employer $3,640. The employee receives the full $2,800 in their KiwiSaver account; the $840 ESCT goes to IRD.

The lookup logic

ESCT rate is determined by adding two numbers: (1) the employee's gross PAYE income for the prior tax year (1 April to 31 March), plus (2) your expected total employer KiwiSaver contributions for the current year. This combined figure is matched against the brackets to find the rate.

For new employees, use a reasonable estimate of expected annual income. Once the employee has been with you for a full tax year, you'll have their actual prior year figure. ESCT rate should be reviewed at the start of each new tax year (1 April) for all employees.

2026/27 ESCT brackets (unchanged from 2025/26)

10.5% — Prior year salary + expected employer KS contributions: $0 to $18,720
17.5% — $18,721 to $64,200
30% — $64,201 to $93,720
33% — $93,721 to $216,000
39% — Over $216,000

Filing and paying ESCT

ESCT is reported alongside PAYE in your payday filing through myIR. Payment is due at the same time as PAYE: monthly (20th of following month) for employers with PAYE+ESCT under $500k/year, twice-monthly (20th and 5th) for employers above. ESCT is included on the IR348 monthly schedule.

Sources

Related calculators

Employer Cost of an Employee Calculator — full loaded cost
KiwiSaver Retirement Calculator — employee perspective
NZ PAYE Calculator — employee take-home pay
KiwiSaver Fee Calculator — long-term fee impact

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