The ACC earner levy is deducted from every New Zealand employee’s pay alongside PAYE income tax. Most NZ workers see the deduction on their payslip but few understand what it is, how it’s calculated, or what it funds. This guide covers everything.
The ACC earner levy rate for 2026–27 (current, from 1 April 2026) is 1.75 cents per dollar of income, applied to earnings up to $156,641/year. On a $70,000 salary, the levy is $1,225/year ($23.56/week). The maximum annual levy is $2,741.22 (for any income above $156,641). For 2025–26 the rate was 1.67%, capped at $152,790. ACC covers the cost of treatment and income compensation for personal injuries in NZ.
ACC Earner Levy Rates 2026–27 (Current)
| Income | Annual ACC Levy | Weekly ACC Levy |
|---|---|---|
| $30,000 | $525 | $10.10 |
| $40,000 | $700 | $13.46 |
| $50,000 | $875 | $16.83 |
| $60,000 | $1,050 | $20.19 |
| $70,000 | $1,225 | $23.56 |
| $80,000 | $1,400 | $26.92 |
| $90,000 | $1,575 | $30.29 |
| $100,000 | $1,750 | $33.65 |
| $120,000 | $2,100 | $40.38 |
| $156,641+ | $2,741.22 (max) | $52.72 (max) |
Formula: Annual levy = min(gross income, $156,641) × 0.0175
For 2025–26, the rate was 1.67% capped at $152,790 (max annual levy $2,551.59).
What Is ACC?
The Accident Compensation Corporation (ACC) is a New Zealand Crown entity that provides a no-fault personal injury insurance scheme. New Zealand’s ACC scheme is unique globally — it replaces the right to sue for personal injury with guaranteed, government-funded compensation.
What ACC covers:
- Medical treatment costs (GP visits, hospital, surgery, physio, dentistry for injuries)
- Weekly compensation for lost income (80% of pre-injury income, up to the scheme maximum)
- Rehabilitation and retraining
- Lump-sum payments for permanent impairments
- Home and vehicle modification for serious injuries
- 24/7 accident cover — any time, anywhere in NZ
What ACC does NOT cover:
- Illness or disease (not caused by an accident)
- Gradual process injuries that are work-related (have specific rules)
- Elective or cosmetic procedures
- Mental health conditions not linked to a physical injury (though work-related mental injury has limited cover)
How the ACC System Is Funded
ACC operates across three main accounts, funded by different levies:
| Account | Funds | Levied On |
|---|---|---|
| Earners’ Account | Injuries outside work | Employees (earner levy) |
| Work Account | Work-related injuries | Employers (employer levy) |
| Motor Vehicle Account | Road accident injuries | Motor vehicle registration + petrol |
| Non-Earners’ Account | Injuries to non-earners (children, retired) | Government (general taxation) |
| Treatment Injury Account | Medical treatment injuries | Government |
As an employee, you pay into the Earners’ Account through the earner levy. This covers you for injuries that happen outside work — at home, playing sport, or in a public place.
Your employer separately pays an employer levy into the Work Account (you don’t see this on your payslip). This covers you for work-related injuries.
Earner Levy vs Employer Levy
| Earner Levy | Employer Levy | |
|---|---|---|
| Who pays | Employee | Employer |
| How collected | Via PAYE on your payslip | Employer ACC invoice (annual) |
| Rate (2026–27) | 1.75% (was 1.67% in 2025–26) | Industry-specific (varies widely, from well under $1 to $14+ per $100 of earnings in high-risk industries) |
| Covers | Off-work injuries | Work-related injuries |
| Cap | $156,641 income | Varies by industry |
Employers in high-injury industries (construction, forestry, farming) pay higher employer levy rates. Office workers’ employers pay lower rates.
What Happens When You Make an ACC Claim
If you suffer a personal injury in NZ:
- Get treatment: Visit a GP, A&E, or relevant provider. They lodge the ACC claim on your behalf.
- Claim is assessed: ACC reviews whether your injury is covered (most are accepted)
- If accepted:
- Medical costs are covered directly
- If you cannot work: weekly compensation of 80% of your pre-injury income starts after the first week
- If declined: You can request a review — ACC’s decisions are reviewable and can be appealed to the District Court
Weekly compensation cap: 80% of income up to the maximum liable earnings figure ($156,641/year for 2026–27), which caps weekly compensation at roughly $125,300/year (about $2,410/week) before tax.
ACC for Self-Employed People
If you are self-employed, the levy structure differs:
- You pay both the earner levy and a work levy (combined into a single levy) through your IRD tax account
- You must provide your previous year’s income (from your IR3 tax return) to calculate the levy
- If your income changes significantly, you can apply for an estimate
- The work levy rate for self-employed is industry-specific
KiwiSaver note: Self-employed people do not get employer KiwiSaver contributions but they do get ACC cover when contributing the levy.
ACC Levy History
ACC reviews levy rates annually. The earner levy rate has changed significantly over the past decade:
| Year | Earner Levy Rate | Maximum Liable Earnings |
|---|---|---|
| 2018–19 | 1.39% | — |
| 2019–20 | 1.39% | — |
| 2020–21 | 1.39% | — |
| 2021–22 | 1.39% | — |
| 2022–23 | 1.46% | — |
| 2023–24 | 1.53% | — |
| 2024–25 | 1.60% | $142,283 |
| 2025–26 | 1.67% | $152,790 |
| 2026–27 (current) | 1.75% | $156,641 |
The trend has been gradually upward as medical costs, claim volumes, and the cost of catastrophic injury support increase. ACC levy rates are published annually at acc.co.nz.
Frequently Asked Questions
What is the ACC levy rate in NZ for 2026–27?
1.75% of gross earnings, applied on income up to $156,641/year. Maximum annual levy: $2,741.22. For 2025–26 the rate was 1.67%, capped at $152,790 (max levy $2,551.59). The levy is deducted by your employer through PAYE and appears on your payslip.
Is the ACC levy tax-deductible?
No. The ACC earner levy is not deductible from your taxable income. You pay it on your gross income before income tax is applied. It is not a tax — it is a levy for the ACC insurance scheme — but it is compulsory for all employees.
What does ACC cover vs health insurance?
ACC covers treatment and income replacement for personal injuries only — including road accidents, sports injuries, and falls. It does not cover illness or disease (cancer, heart disease, infection). Private health insurance covers illness and may supplement ACC for injuries (covering wait times, specialist access, or costs exceeding ACC funding).
Can I opt out of ACC?
No. ACC cover and the earner levy are compulsory for all NZ employees and self-employed people. There is no opt-out option. The no-fault scheme replaced the right to sue for personal injury in NZ — the trade-off is universal, automatic cover.
Does ACC cover me overseas?
Limited cover applies for NZ residents temporarily overseas — ACC may cover emergency treatment costs for injuries sustained abroad. However, cover is limited and you should have travel insurance for overseas trips. ACC full cover applies from the moment you return to NZ.