Secondary tax in New Zealand is not a special extra tax; it is just PAYE deducted at a rate based on your total expected income from all jobs, using specific “secondary” tax codes so you do not end up with a big bill at the end of the year.

What “secondary tax” actually is

When you have more than one job or source of PAYE income, only one job uses your main tax code (usually M or ME), and any additional job uses a secondary tax code so Inland Revenue can tax your total income at the right marginal rate.

The secondary tax rate is therefore just your normal marginal tax rate applied to that extra job, not an extra layer of tax on top.

Current secondary tax rates (NZ)

For the 2025–2026 income year, secondary tax codes and their rates (before ACC) are:

  • SB – total income from all jobs up to $15,600: 10.5%
  • S – total income $15,601 to $53,500: 17.5%
  • SH – total income $53,501 to $78,100: 30%
  • ST – total income $78,101 to $180,000: 33%
  • SA – total income over $180,000: 39%

These rates match the standard income tax brackets; the “secondary” label only indicates this is not your main job.

How to know which rate applies to you

  • Estimate your total income from all jobs for the tax year (1 April to 31 March).
  • Use that total to pick the matching secondary code for your second (or third) job, using the table above or IRD’s guidance.
  • If too much tax is deducted through your secondary job, you can usually get a refund after the end-of-year square-up by IRD.

Common misconceptions and forum chatter

Many Kiwis think secondary tax means you “get hammered” on your second job, but in reality the system just tries to tax all your income at the progressive rates you would pay anyway.

On NZ personal finance forums, experienced posters often stress that there is “no special secondary tax”, only marginal tax applied via different codes so that low earners are less likely to owe money at year end.

Information gathered from public forums or data available on the internet and portrayed here.