KiwiSaver 1 April 2026 Changes

What every NZ Bookkeeper needs to know

There I was, helping a new client with their March payroll run, double-checking that everything was ready for the new financial year – when Bam! – they asked, “Hey, what’s actually changing with KiwiSaver from 1 April next year?”

I’d been tracking the Budget 2025 changes, but this was the moment it clicked: we Bookkeepers don’t just need to know this stuff – we need to master it for our clients.

From KiwiSaver contribution rate shifts to eligibility updates and temporary rate options, some subtle but important changes are landing 1 April 2026. Let’s walk through them in a way that makes sense for your payroll planning, client conversations and compliance checklists.

The big shift: contribution rates rise (but not all at once)

From 1 April 2026, the default KiwiSaver contribution rate for both employees and their employers increases from 3% to 3.5% of before-tax earnings. (ref: Inland Revenue)

That’s right – employers will also need to increase their matching contributions in the next payroll year. For many Kiwis, that means:

• slightly less take-home pay (that 0.5% can be noticeable),
• but more regularly going into their KiwiSaver – which adds up over time,
• and a longer-term boost to retirement savings for your clients and their staff.

Then from 1 April 2028, the minimum rate lifts again to 4% – so this is part of a longer-term staged increase. (ref: NZ 2025 Budget)

Temporary rate reductions: a flexible option for members

Not all employees will want – or be able – to jump straight to 3.5%. That’s why Inland Revenue is introducing a temporary rate reduction option.

From 1 February 2026, KiwiSaver members can apply for a temporary reduction to stay at 3% instead of increasing to 3.5% on 1 April 2026. (ref: Inland Revenue)

A few key things Bookkeepers and employers should know:

• The reduction applies only from the first pay on or after 1 April 2026.
• Employees can choose temporary reductions for 3 months up to 12 months and can reapply.
• If an employee opts for the reduced rate, employers can match it, so both contributions stay at 3%. (ref: Business.govt.nz)
• When the reduction period ends, contribution rates default back to the higher level unless the employee reapplies or chooses a new rate. (ref: Inland Revenue)

This flexibility is sometimes overlooked – but for Bookkeepers advising small business clients with tighter payroll margins, it’s a gold mine for proactive planning.

New opportunities for younger workers

Here’s some good news: from 1 April 2026, 16- and 17-year-olds who are KiwiSaver members and are earning a wage will now be eligible to receive employer contributions (as long as they meet normal eligibility criteria). (ref: Inland Revenue)

That’s a great step forward in helping younger New Zealanders start saving earlier – and it’s one more detail you will want to flag in client communications or onboarding guides.

A quick review: what’s already changed (before 1 April 2026)

A couple of related KiwiSaver changes have already taken effect in 2025 – and they matter when you’re explaining the whole picture to clients:

• From 1 July 2025, the Government contribution was cut from 50 cents to 25 cents for every dollar contributed (max annual contribution dropped too).
• Also from mid-2025, high-income earners above roughly $180,000 a year no longer qualify for the Government contribution.

These earlier updates mean the KiwiSaver incentives landscape has shifted – so the extra half-percent going in from 2026 is now even more significant. (ref: NZ 2025 Budget)

Lesson for Bookkeepers

Here’s where the story turns into the lesson you can use right now:

Don’t treat KiwiSaver changes as ‘just another number’ – they affect payroll budgeting, cashflow, employment agreements, remuneration benchmarking and client forecasting.

Whether you’re doing year-end reviews or planning payroll runs into the new financial year, make this a standard tick in your checklist:

• Update default KiwiSaver contribution settings in payroll systems
• Communicate changes to employers and employees early
• Flag rate reduction options for staff who may need them
• Revisit remuneration packages with these extra costs in mind

What this means for your business

Clients will look to you not just for accuracy, but for clarity. Instead of fielding queries week-by-week next March, you can be the advisor who pre-emptively explains these changes – and helps clients avoid surprises when those first payruns hit April 2026.

A simple email or toolkit now demonstrates value beyond compliance.