Contractor vs Employee Calculator
An indicative side-by-side of take-home pay as a salaried employee versus an independent contractor in New Zealand. Read the assumptions below — this is a guide, not tax or financial advice.
As an employee
$
%
As a contractor
$
$
$
The ACC Work levy varies a lot by occupation — enter your own estimate.
Employee take-home / yr
—
+ employer KiwiSaver
Contractor take-home / yr
—
after expenses & costs
| Per year | Employee | Contractor |
|---|---|---|
| Gross income | ||
| Business expenses | — | |
| Taxable income | ||
| Income tax (PAYE) | ||
| ACC earners' levy | ||
| KiwiSaver (you) | ||
| Student loan | ||
| Other costs | — | |
| Take-home | ||
| Employer KiwiSaver (extra benefit) | self-funded |
Enter an employee salary and a contractor rate to compare indicative take-home pay.
Assumptions & what's not included
- Indicative only, not advice. Contractor income tax is estimated using the same income-tax brackets; contractors actually pay via provisional tax, not PAYE.
- ACC: both pay the earners' levy (shown). Contractors also pay an ACC Work levy (CoverPlus) that varies by occupation — include your own estimate in "other costs".
- Paid leave: employees get paid annual leave, public holidays and sick leave; contractors don't. Set contractor "weeks worked" below 52 to reflect unpaid time off.
- KiwiSaver: employees receive the compulsory employer contribution (shown as an extra benefit); contractors self-fund with no employer match.
- GST: if your contracting turnover exceeds $60,000 you must register for GST. GST is charged on top of your fees and passed to IRD, so it doesn't change your net income — it's excluded here.
- Not included: income variability and gaps between contracts, invoicing/admin time, insurance, accounting fees, equipment, and the job security and minimum-employment-rights protections employees have.
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