Written by Accountants on Domain
KiwiSaver rules are changing from 1 April 2026, and while that might feel a long way off, now is the right time for employers to understand what’s coming and plan ahead.
The Government is lifting the default KiwiSaver contribution rates to help people save more for their first home and retirement, and to make the scheme more financially sustainable. The changes are being phased in, giving businesses time to prepare without unnecessary pressure.
Here’s a clear, plain-English breakdown of what’s changing – and what it means for your payroll.
Why this matters for your business
KiwiSaver changes may seem small on paper, but they affect:
- Payroll calculations
- Employer contribution obligations
- Employee communications
- Payroll system settings
Getting across the changes early helps avoid last-minute stress, payroll errors, and awkward conversations with staff.
What’s changing from 1 April 2026?
1. Minimum KiwiSaver contribution rates are increasing
From the first payday on or after 1 April 2026:
- Employee contributions increase from 3% to 3.5%
- Employer contributions increase from 3% to 3.5%
This new rate will become the default unless an employee has approval for a temporary rate reduction.
Inland Revenue guidance: KiwiSaver for individuals
2. Employer KiwiSaver contributions for 16 and 17-year-olds
From 1 April 2026, employers will be required to make KiwiSaver employer contributions for eligible employees aged 16 or 17, if they are KiwiSaver members and meet the eligibility rules.
This is a change from current settings and may affect businesses that employ younger staff, particularly in retail, hospitality, and entry-level roles.
Inland Revenue guidance: KiwiSaver for employers
What if an employee wants to stay at 3%?
Employees who are currently contributing 3% and don’t want their rate to increase can apply for a temporary rate reduction.
What to know:
Applications open from 1 February 2026
- Applications are made by the employee through their myIR account
- Inland Revenue issues a certificate
- The certificate must be given to the employer (or payroll provider)
- The reduced rate applies for 3 to 12 months
- Employees can reapply if they still need it
*This option isn’t available if the employee already has an active KiwiSaver savings suspension.
More information from Inland Revenue: KiwiSaver for individuals
What employers should do now
To stay ahead of the changes, we recommend that employers:
- Review payroll systems and contribution settings
- Identify any 16 or 17-year-old KiwiSaver members on the payroll
- Let staff know about the upcoming changes early
- Put a process in place for handling rate reduction certificates
Clear communication and early preparation will make the transition much smoother.
How we can help
If we run your payroll, we’ll:
- Update contribution rates to the new 3.5% default
- Apply any valid rate reduction certificates you provide
- Help ensure everything is compliant from April 2026
If you run your own payroll, we’re happy to:
- Review your setup
- Answer questions
- Or talk through whether outsourcing payroll could save you time and stress
KiwiSaver and payroll compliance don’t need to feel overwhelmed. With the right support, they can be simple and well managed.
Get in touch or book a chat to make sure you’re ready well before April 2026.
