From 1 April 2025, employer superannuation contribution tax (ESCT) and fringe benefit tax (FBT) thresholds will change. FBT calculation methods will also change.
What you need to do
Check you have the most up-to-date version of your payroll software (if you use software). Your payroll software should have updates for these changes.
If you calculate ESCT yourself, the PAYE deduction tables (IR340 and IR341) will be updated the week starting 24 March.
ESCT threshold changes
An example of ESCT is an employer's contribution to an employee's KiwiSaver scheme. ESCT is the tax that is deducted from this contribution.
The new ESCT thresholds take effect from 1 April 2025.
| New ESCT thresholds | Tax rate |
|---|---|
| $0 - $18,720 | 10.5% |
| $18,721 - $64,200 | 17.5% |
| $64,201 - $93,720 | 30% |
| $93,721 - $216,000 | 33% |
| $216,001 upwards | 39% |
Employer superannuation contribution tax
FBT changes
You’ll need to apply a new alternate tax rate calculation method for the first time. The new rate applies from 1 January 2025 and is for final quarter returns.
The new FBT thresholds take effect from 1 April 2025.
| New FBT thresholds | Tax rate |
|---|---|
| $0 - $13,962 | 11.73% |
| $13,963 - $45,230 | 21.21% |
| $45,231 - $62,450 | 42.86% |
| $62,451 - $130,723 | 49.25% |
| $130,724 upwards | 63.93% |
Other rate changes
Any annual rate increases which take effect on 1 April 2025 (for example, the ACC levy rate) will also be in the most up-to-date version of your payroll software as well as the updated PAYE deduction tables (IR340 and IR341).