Blog

Payroll Changes from 1 April 2026: What You Need to Know

With the end of the financial year approaching, a few key payroll changes are coming into effect from 1 April 2026. Most of them aren’t dramatic, but they will affect take-home pay, employer contributions, and payroll systems.

Here’s a straightforward breakdown of what’s changing — and what you need to do.

Minimum Wage Increase

From 1 April 2026:

• Adult minimum wage increases to $23.95 per hour

• Starting-out and training minimum wage increases to $19.16 per hour (80% of the adult rate)

What this means for you:
If you have staff on minimum wage — or close to it — you’ll need to review and update pay rates before the first pay run after 1 April. It’s worth checking employment agreements and payroll settings now so nothing gets missed.

ACC Earner Levy Increase

The ACC earner levy is increasing from:

• $1.67 to $1.75 per $100 of liable earnings

The maximum liable earnings threshold is increasing to $156,641, with a maximum levy of $2,741.22 for the 2026/27 tax year.

For self-employed individuals, the minimum liable earnings for Work and Earners’ levies will increase to $50,501.

What this means for employees:
Employees will see a slightly lower net pay from 1 April. For every $100 earned, they’ll pay an extra 8 cents in ACC levy. It’s small per pay run, but noticeable over time.

If your payroll software updates automatically, this should be handled for you — but it’s still worth checking.

KiwiSaver Changes

This is the big one.

From 1 April 2026, the default minimum KiwiSaver contribution rate increases:

• From 3% to 3.5% for employees

• From 3% to 3.5% for employers

This applies unless the employee has an approved temporary rate reduction.

Temporary Rate Reduction

From 1 February 2026, employees can apply directly to Inland Revenue to temporarily reduce their contribution rate back to 3% for between 3 and 12 months.

Important points:

• The reduction only applies from 1 April 2026.

• Employers are not required to match the reduced rate (although they may choose to).

16–17 Year Old Employees

From 1 April 2026, employees aged 16–17 who are enrolled in KiwiSaver become eligible for compulsory employer contributions.

That’s a change that could catch employers off guard, particularly in retail and hospitality sectors.

What Should Employers Do Now?

Before 1 April 2026:

• Review minimum wage employees

• Confirm payroll system updates are scheduled

• Communicate KiwiSaver changes to staff

• Budget for increased employer KiwiSaver contributions

• Check how 16–17 year old employees will be affected

None of these changes are complex on their own — but together they do shift payroll costs slightly upward. A quick review now avoids awkward conversations (and messy corrections) later.

For those using Smartly the changes to Kiwisaver and ACC will be done for you but minimum wage rates will have to be adjusted yourself.

If you’d like help reviewing your payroll setup or understanding how these changes affect your business specifically, we’re happy to talk it through.