The ACC earners’ levy in 2026-27: what you pay and why
Every pay has an ACC line. It is not income tax: it pays for New Zealand’s no-fault accident cover for injuries that happen away from work.
Reviewed by Radif Partners · Editorial policy
The ACC earners’ levy is a charge on your earnings that funds the Accident Compensation Corporation’s cover for injuries outside work, such as sport, home and road accidents that are not motor vehicle claims. For the 2026-27 tax year it is 1.75 % of liable earnings, or $1.75 per $100, up from 1.67 % in 2025-26, on earnings up to $156,641 a year. The maximum levy is therefore $2,741.22. Employees pay it through PAYE, often shown together with income tax on the payslip. Self-employed people pay it on an invoice from ACC after the year, together with a work levy for their industry. Employers pay a separate work levy for their employees’ workplace injuries. On a salary of $60,000, the earners’ levy costs $1,050 a year, $20.19 a week. The levy rates are set by the government every three years after public consultation, and the current settings run to 2027-28.
What the levy costs by income
| Earnings | Levy 2025-26 | Levy 2026-27 | Increase | Per week 2026-27 |
|---|---|---|---|---|
| $30,000 | $501.00 | $525.00 | $24.00 | $10.10 |
| $60,000 | $1,002.00 | $1,050.00 | $48.00 | $20.19 |
| $90,000 | $1,503.00 | $1,575.00 | $72.00 | $30.29 |
| $120,000 | $2,004.00 | $2,100.00 | $96.00 | $40.38 |
| $156,641 | $2,551.59 | $2,741.22 | $189.63 | $52.72 |
| $200,000 | $2,551.59 | $2,741.22 | $189.63 | $52.72 |
The levy is proportional up to the ceiling, then flat: an income of $200,000 pays the same as $156,641. The 2026-27 increase adds between a few dollars and about $190 a year.
Three levies, three payers
ACC is funded by several accounts. The earners’ account, funded by the earners’ levy, covers non-work injuries of people in paid work. The work account, funded by the work levy that employers pay on their payroll and self-employed people pay on their earnings, covers injuries at work; its rate depends on the industry’s risk classification. The motor vehicle account, funded through petrol excise and vehicle licensing, covers road injuries. The government funds cover for people who are not earning. Only the earners’ levy appears on an employee’s payslip.
How employees pay it
Inland Revenue collects the earners’ levy with PAYE on ACC’s behalf. Your employer deducts 1.75 % of your gross pay each pay day until your earnings for the year reach $156,641, if it has that information; many payslips show a single PAYE figure that already includes it. Some payments, such as redundancy payments, are not liable earnings and do not attract the levy.
Self-employed and shareholder-employees
People who work for themselves are invoiced by ACC once Inland Revenue has their income, for the earners’ levy and the work levy under CoverPlus, or they can choose CoverPlus Extra to agree a fixed level of weekly compensation in advance. The invoice arrives after the tax year and is deductible. Shareholder-employees of their own company are treated as self-employed for ACC on their shareholder salary. The self-employed tax guide puts ACC alongside income tax and GST.
What the cover gives you
In return for the levy, anyone injured in an accident in New Zealand is covered for treatment costs, and people in paid work receive weekly compensation of up to 80 % of their earnings, capped at the maximum liable earnings, if they cannot work because of the injury. There is no right to sue for personal injury damages in most cases, which is the trade-off of the no-fault scheme. The cover applies whatever the cause of the accident and whoever is at fault.
How rates are set
ACC recommends levy rates for three years, the government consults publicly and sets them by regulation. The current consultation set the earners’ levy for 2025-26, 2026-27 and 2027-28, rising each year to restore the account’s funding after higher claim costs. The maximum liable earnings are adjusted each year in line with average wages. The PAYE calculator uses the 2026-27 rate and ceiling.
Weekly compensation and the levy base
The earnings on which you pay the levy are also the earnings ACC uses if you cannot work after an injury. Weekly compensation is 80 % of your earnings before the injury, capped by the same maximum: at the $156,641 ceiling, the most ACC pays is about $2,409.86 a week before tax. For a work injury, your employer pays the first week at 80 %; for an injury outside work, the first week is not compensated, and ACC pays from the second week. Weekly compensation is taxable income, and PAYE is deducted from it, but no earners’ levy is charged on it.
Two jobs and the ceiling
Each employer deducts the levy on the pay it knows about, without seeing your other jobs, so someone with two jobs whose total exceeds $156,641 pays more than the maximum during the year. The excess is refunded through your end-of-year income tax assessment, with no application needed, as long as Inland Revenue has the income from both jobs. The levy applies to salary and wages, holiday pay, bonuses and commissions, but not to employer KiwiSaver contributions, interest, dividends or NZ Super.
Checking the levy on your payslip
Payslips rarely show the ACC levy separately: most employers include it in the PAYE line, since Inland Revenue’s PAYE tables combine income tax and the earners’ levy. To check it, multiply your gross pay for the period by 1.75 % and compare the PAYE line with the tax alone from the calculator. If the difference is larger than the levy, your tax code is the first thing to look at. The PAYE rates guide shows the combined deduction for each band.