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Find out about: Tax rates and codes

When to use secondary tax codes and special tax codes

Secondary tax codes

If you have more than one job, you need to work out which one is your main job. This will usually be the job that you earn the highest income from, unless you are receiving an income-tested benefit. You should generally use a secondary tax code for all other jobs apart from your main one. This means you'll have the secondary rate of tax deducted from that income.

If you're receiving an income tested benefit while also working, you must use the "M" tax code for your benefit and use a secondary tax code for your other income.

Secondary tax rates

Use the tables below to find out what your tax rate will be.

You don't have a student loan

If your annual income from all sources is ... then your secondary tax code is... and your secondary tax rate (including 1.70% earners' levy) is ...
$14,000 or less SB 12.20%
between $14,001 and $48,000 S 19.20%
between $48,001 and $70,000 SH 31.70%
between $70,001 and $113,768 (plus ACC) ST 34.70%
more than $113,768 (no ACC) ST 33%

You have a student loan

From 1 April 2012, you're required to use a secondary tax code including "SL" on your secondary income unless you have a repayment deduction exemption. If you're not already using a secondary tax code that includes "SL", you should complete a new Tax code declaration (IR330) and give it to your employer.

If your annual income from all sources is ... then your secondary tax code is ... and your secondary tax rate (including 1.70% earners' levy) is ...
$14,000 or less SB SL - see "Note" below 24.20%
between $14,001 and $48,000 S SL - see "Note" below 31.20%
between $48,001 and $70,000 SH SL 43.70%
between $70,001 and $113,768 (plus ACC) ST SL 46.70%
more than $113,768 (no ACC) ST SL 45%

 

Note  

If the secondary tax code you choose for your circumstances is "SB SL" or "S SL" and your gross income from your main job is less than $367 per week, the 10% standard deductions for your secondary income may be too high. You may qualify for a special deduction rate.

Use our tax code decision tree to help you find the right tax code to complete on the Tax code declaration (IR330) form.

Special tax codes

A special tax code is a tax rate worked out to suit your individual circumstances. If you usually receive a large income tax bill or refund, it's a good idea to apply for a special tax code. This ensures you pay the right amount of tax.

Special tax codes can only be used to change your income tax deduction rate. If you need to reduce your student loan repayment deductions you can apply for a special deduction rate on your secondary earnings or a repayment deduction exemption if you're studying full-time.

If you want to pay your student loan off faster, you can make extra repayments whenever you want to. You can pay us directly or ask your employer to make extra deductions from your salary or wages.

 

 


Date published: 02 Apr 2014

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