🇦🇺 vs 🇳🇿

Australia vs New Zealand Tax Comparison 2026

Complete side-by-side comparison of Australian and New Zealand tax systems: income tax rates, Medicare levy vs ACC, superannuation vs KiwiSaver

Quick Overview

Key differences between Australian and New Zealand tax systems at a glance

🇦🇺 Australia

  • 📊 Tax Rates: 0% - 45%
  • 🏛️ System: Federal (unified)
  • 💼 Medicare Levy: 2%
  • 🏦 Superannuation: 11.5% (employer)
  • 📅 Tax Year: July 1 - June 30
  • 💰 Tax-Free Threshold: A$18,200

🇳🇿 New Zealand

  • 📊 Tax Rates: 10.5% - 39%
  • 🏛️ System: National (unified)
  • 💼 ACC Levy: ~1.67%
  • 🏦 KiwiSaver: 3% minimum (employee)
  • 📅 Tax Year: April 1 - March 31
  • 💰 Tax-Free Threshold: None (taxed from $1)

Detailed Tax Comparison

Side-by-side breakdown of tax rates, brackets, and contributions

Category 🇦🇺 Australia 🇳🇿 New Zealand
Income Tax Brackets 0%, 16%, 30%, 37%, 45%
Progressive system (2024-25)		 10.5%, 17.5%, 30%, 33%, 39%
No tax-free threshold
Tax-Free Threshold A$18,200
No tax on first $18,200		 NZ$0
10.5% applies from first dollar
Health Levy 2% Medicare Levy
Funds public healthcare		 ~1.67% ACC Levy
Accident compensation
Retirement Savings 11.5% Superannuation
Employer contribution (mandatory)		 3-10% KiwiSaver
Employee contribution + employer 3%
Capital Gains Tax Marginal rate (with 50% discount)
Assets held >12 months		 No CGT
No capital gains tax
GST/VAT 10% GST
Goods and Services Tax		 15% GST
Higher consumption tax
Top Tax Rate Threshold 45% above A$190,000
2024-25 tax year		 39% above NZ$180,000
Lower top rate

💡 Key Insight: Effective Tax Rate

For a A$100,000 / NZ$110,000 income earner:

  • Australia: ~24% effective rate (income tax + Medicare levy) = ~A$24,000 tax
  • New Zealand: ~22% effective rate (income tax + ACC) = ~NZ$24,500 tax

Note: Australia's higher tax-free threshold offsets higher marginal rates. NZ's lack of CGT benefits property investors. Exchange rate fluctuations affect real comparisons.

Pros and Cons

Advantages and disadvantages of each tax system

🇦🇺 Australia

✓ Advantages

  • A$18,200 tax-free threshold
  • Lower GST (10% vs 15%)
  • Mandatory employer superannuation (11.5%)
  • 50% CGT discount for long-term holdings
  • Medicare provides universal healthcare
  • Higher minimum wage

✗ Disadvantages

  • Higher top marginal rate (45% vs 39%)
  • Capital gains tax exists
  • 2% Medicare levy on top of income tax
  • Higher cost of living in major cities
  • Complex tax residency rules
  • Higher property prices

🇳🇿 New Zealand

✓ Advantages

  • No capital gains tax
  • Lower top rate (39% vs 45%)
  • Simpler tax system
  • No inheritance/estate tax
  • Lower overall tax burden for high earners
  • More affordable property (outside Auckland)

✗ Disadvantages

  • No tax-free threshold (taxed from $1)
  • Higher GST (15% vs 10%)
  • Lower employer KiwiSaver contribution (3%)
  • Higher effective rate for low earners
  • Lower wages generally
  • ACC levy for accident insurance

Who Pays Less Tax?

It depends on your income level and circumstances

💰 Low Income (Under $50k)

Winner: Australia

  • A$18,200 tax-free threshold is huge
  • NZ taxes from first dollar (10.5%)
  • Significant savings for low earners

📊 Middle Income ($50k-$120k)

Winner: Roughly Equal

  • Effective rates converge
  • Australia: better tax-free + super
  • NZ: lower marginal rates, no CGT

🏆 High Income ($150k+)

Winner: New Zealand

  • NZ top rate 39% vs AUS 45%
  • No capital gains tax in NZ
  • Property investors favor NZ

⚖️ The Verdict

Trans-Tasman tax choice depends on:

  • Income level: Low earners benefit from Australia's tax-free threshold
  • Investment strategy: Property/share investors prefer NZ's no CGT
  • Retirement planning: Australia's 11.5% super vs NZ's 3% employer contribution
  • Lifestyle costs: NZ has 15% GST vs Australia's 10%
  • Healthcare: Both have good public systems (Medicare vs ACC)

General rule: Australia better for employees/low-middle income. New Zealand better for high earners, investors, and business owners.

🧮 Calculate Your Exact Tax Burden

Use our free calculator to compare your specific situation in both countries

Compare Both Countries Australia Calculator New Zealand Calculator

Compare Other Countries

USA vs UK Hong Kong vs Singapore View All Guides →