Getting a pay rise feels great — but how much of it do you actually take home after tax? If a raise pushes you into a higher tax bracket, or if inflation erodes the real value, the actual gain may be smaller than the number suggests. This calculator shows you the real impact.
A $5,000 gross raise in the 30% tax bracket gives you approximately $3,413 more per year net ($66/week). A $10,000 raise in the 33% bracket gives approximately $6,525 more per year net ($125/week). The gap between your gross raise and take-home increase is the tax and ACC on the additional income.
Pay Rise Calculator
Calculate Your Real Pay Rise
How NZ Tax Brackets Affect Your Raise
A common misconception: crossing a tax bracket means your entire salary is taxed at the higher rate. This is wrong — only the portion above the threshold is taxed at the higher rate.
| Tax Bracket | Rate | What This Means for a Raise |
|---|---|---|
| $0–$15,600 | 10.5% | Every dollar of raise here: 89.5 cents take-home |
| $15,601–$53,500 | 17.5% | Every dollar of raise here: 82.5 cents take-home |
| $53,501–$78,100 | 30% | Every dollar of raise here: 70 cents take-home |
| $78,101–$180,000 | 33% | Every dollar of raise here: 67 cents take-home |
| $180,001+ | 39% | Every dollar of raise here: 61 cents take-home |
Example: $75,000 to $80,000 Raise
This $5,000 raise crosses the $78,100 bracket threshold — $3,100 is taxed at 30% and $1,900 at 33%:
- Tax on extra $5,000: $1,557 ($930 at 30% + $627 at 33%)
- ACC on extra $5,000: $87.50 (1.75%)
- Net gain: $3,355.50/year ($64.53/week)
Is Your Raise a Real Raise?
A pay rise only improves your purchasing power if it exceeds inflation. NZ’s inflation target band is 1–3%, with a 2% midpoint.
| Raise % | Inflation | Real Raise | Verdict |
|---|---|---|---|
| 2% | 3% | -1% | Pay cut in real terms |
| 3% | 3% | 0% | Standing still |
| 5% | 3% | +2% | Genuine improvement |
| 5% | 5% | 0% | Just keeping up |
| 10% | 3% | +7% | Significant real gain |
When negotiating, anchor your argument to: current CPI + personal performance premium. A cost-of-living-only raise keeps you even; a merit raise should exceed CPI.