Student Loan for a New Zealand employee is like STSL (in Australia), it can help finance an employee’s tertiary studies. A Student Loan must be repaid once an employee earns over a certain threshold. For more information on Student Loans in New Zealand refer to the Inland Revenue Department's website:
The Annual Loan Threshold for Financial Year 2025/2026 is $24,128. The loan repayment rate is 12%. MicrOpay will apply the threshold to the standard loan repayment and Student Loan CIR for Employees on a Main tax scale. Student Loan BOR, Student Loan Rate and Employees on a Secondary tax scale won't have the threshold applied.
If the IRD advice that Student Loan needs to be repaid at a different rate, e.g. 3% instead of 12% taking into account the Threshold, use Manual Calculation to enter the Employee's pay and overwrite the Student Loan value.
In MicrOpay, the parameters are held in the Tax Parameters, Maintenance, Tax, Tax Parameters.
To view the Student Loan fields on an Employee, go to Payroll, Maintenance, Employees, Employees and select Tax Details.
The table below explains each of the Student Loan fields:
Student Loan (SL) | Standard Loan Rate, i.e., 12% |
Student Loan Rate | Optional to select a higher percentage |
Student Loan CIR (SLCIR) | Commissioner deductions are extra deductions required by IRD. The maximum rate will be 5% on gross income. The Student Loan threshold will apply. |
Student Loan BOR (SLBOR) | The borrower (employee) can elect to pay more. This can be a percentage or an amount. The Student Loan threshold will not apply. There is no maximum. |
These values will show separately on the Pay Advice, Transaction Report, and Employee Enquires.
When reviewing Payday Filing, all Student Loan values will be on the Print Report and the Employment Information (EI) file that you upload to the IRD as separate columns. However, SLCIR, SLBOR, and ESS (Employee Share Scheme) do not appear in the Employment Information Grid that you access by clicking Employment Information in the Payday Filing window. The grid will only display Student Loan.
Student Loan Deduction in detail
SLBOR Borrower deduction is when an employee requests a voluntary extra deduction. The employee will advise the percentage or amount for these additional payments.
SLCIR Commissioner compulsory deductions are required to make additional student loan repayments. The Inland Revenue Department (IRD) will advise the deduction percentage. The IRD notice will provide the additional deductions that you must make from the employee's earnings and the total recoverable amount. A maximum of 5% additional deduction can be made.
The IRD will advise the SLCIR percentage as a percentage of the Student Loan percentage. For example, they will advise 8.33% which is 8.33% of 12% which calculates to 1%. You enter the result of the calculation into the SLCIR Tax Rate field on the employee record in Tax Details. Use the table below to find the SLCIR Tax Rate to use.
IRD Percentage | Calculations | SLCIR Tax Rate |
8.33 % | 8.33% x 12% | 1% |
16.67% | 16.67% x 12% | 2% |
25% | 25% x 12% | 3% |
33.33% | 33.33% x 12% | 4% |
41.67% | 41.67% | 5% |
The Student Loan and Student Loan Commissioner (SLCIR) repayment deductions occur each pay if the employee's gross earnings for the period exceed the threshold. The threshold is not applied to SLBOR, or if an employee is on a Secondary tax scale.
Student loan pay period repayment thresholds
Pay Frequency | Threshold |
Weekly | $464 |
Fortnightly | $928 |
4 Weekly | $1856 |
Monthly | $2010.66 |
Example:
Gross Weekly Salary Before Tax | $700 |
Weekly Threshold for 2024/25 | -$464 |
SL/SLCIR calculation based on | $236 |
Student Loan (12% of $236) | $28.32 |
The Student Loan value will be included in the Total Tax value.
The Student Loan threshold does not apply to a Lump Sum Payment, if you have already applied the threshold to regular wages and paid those separately, do not apply it to the lump sum. In this case, deduct 12% from the entire lump sum. The above calculation avoids this situation by combining regular pay and any extra pay.