We’ll make paid parental leave payments to your bank account each fortnight. We’ll treat these payments like any other income and deduct tax and any other payments, for example student loan and child support. If you would like to make KiwiSaver contributions from your parental leave payments, you can.
KiwiSaver and paid parental leave
How much your parental leave payments will be
If you're an employee, your payments will match your ordinary weekly pay or your average weekly income up to a maximum:
- $621.76 a week before tax for the 1 July 2021 to 30 June 2022 period
- $606.46 a week before tax for the 1 July 2020 to 30 June 2021 period.
If you're self-employed, your payments will be one of the following:
- either your average weekly self-employed income up to maximum of:
- $621.76 a week before tax for the 1 July 2021 to 30 June 2022 period
- $606.46 a week before tax for the 1 July 2020 to 30 June 2021 period.
- or a minimum payment of:
- $200 a week before tax for the 1 July 2021 to 30 June 2022 period
- $189 a week before tax for the 1 July 2020 to 30 June 2021.
You'll receive at least the equivalent of 10 hours a week at the minimum wage.
How we work out employees' estimated income from employment
If you're an employee, we calculate your ‘ordinary weekly pay’ and ‘average weekly income’ and then use the higher of the 2 to get your estimated income. These amounts are calculated as follows.
Ordinary weekly pay
- Depending on how often you are paid, we'll take your last 4 weeks’, 2 fortnights’, or 1 months' earnings and divide by 4.
Average weekly income
- We take your highest 26 weeks' worth of income from the last 52 weeks before the child’s expected due date or date of birth, or date the child came into your care, and divide by 26.
You can find additional information on the Employment New Zealand website.
Amount of parental leave payment - employment.govt.nz
If you have non-standard working arrangements, such as multiple jobs and variable hours, this calculation may not be accurate. If you follow the Employment New Zealand guidance and determine that your income is different to the prepopulated estimate, you can update this figure.
How to work out your weekly income if self-employed
If you're self-employed you need to calculate your own average weekly income. You can choose whether to calculate your average weekly income over a 12-month or 6-month period. This period ends just before the child’s due date/ birthdate, or the date the employee or their partner becomes the primary carer.
- You can work out your average weekly income over a 12-month period, by dividing your last 12 months net self-employed income by 52.
- For your average weekly income over a 6-month period, divide your last 6 months net self-employed income by 26.
The rate applied is based on the higher of these 2 calculations. Net income is your Gross income less expenses but before tax.
Calculations for when you have more than 1 job
If you receive income from more than 1 job, you can add together the income from all your employers to work out your ordinary or weekly average pay. However, if you receive income from employment and self-employment you can not combine this income to determine your ordinary or weekly average.
Receiving other income
You cannot continue to work while receiving paid parental leave. But you can continue to get certain types of income and keep your entitlement to paid parental leave, such as:
- top-up payments from your employer to supplement your parental leave entitlements
- payments for Keeping In Touch (KIT) hours
- payments for any work done before starting paid parental leave.
You need to use a secondary tax code if you receive other income at the same time as parental leave payments. Whichever payment is smaller should be taxed at the secondary rate.
Using the right tax codes will help you avoid a tax bill at the end of the year.
Tax codes and rates for individuals
Working for Families payments
You may be able to get Working for Families payments while you're on parental leave. You cannot get the Best Start payment until paid parental leave finishes.
