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New Zealand edition2026-27 IRD rates

New Zealand Tech Pay Insights

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Featured · New Zealand

How Redundancy Pay Is Taxed in NZ: The "Extra Pay" Method Explained

Redundancy pay isn't taxed like a normal payslip: IRD adds your regular annual salary to the lump sum to find a marginal rate, then taxes only the lump sum at that rate, with no ACC levy or KiwiSaver deducted. Three worked examples show exactly how the combined total can push a lump sum into a higher bracket than your salary alone would suggest.

21 July 2026 · 8 min read

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