From 1 April 2026, the KiwiSaver default rate is increasing from 3% to 3.5%. This means that you need to update both the employer and employee contributions for employees who currently contribute 3% before processing your first pay in the new financial year. As the payment date is the trigger for the change, it needs to be in place for the first period paid on or after 1 April 2026. Therefore, if your pay period includes hours worked in March but is paid in April, the new rate applies to the entire pay.
Employees can apply for a temporary rate reduction if they want to continue to contribute 3%.
To update the employer contribution, use the KiwiSaver Percentage Change feature in Change Tax Year available in version 9.5. The process will create a new 3.5% KiwiSaver employer contribution and replace the existing 3% contributions linked to active employees.
For the employee contribution, either:
Create a new employee contribution and attach your employees.
Or update the existing employee contribution.
Important:
This information relates to clearing the 2025-2026 financial year to move to the 2026-2027 financial year.
To use the KiwiSaver Percentage Change feature, you must upgrade to version 9.5 before Change Tax Year is run.
Back up your database before completing the Change Tax Year process.
Change Tax Year
Change Tax Year is used to close the current tax year and open the new one. When the tax year is changed, period end dates for the previous tax year are cleared, and only the first period end date for the new financial year is displayed.
After the tax year is changed, pay period values for previous tax years can still be accessed through selected reports.
Using the KiwiSaver Percentage Change feature in Change Tax Year reduces the amount of work you need to do. It also ensures that the new contributions are created after payroll processing for the current financial year is complete and before processing for the new year commences. To change the tax year:
Go to Payroll, Transactions, End of Year, Change Tax Year.
The Current Tax Year will show as Start Date, 1/4/2025 and End Date, 31/3/2026.
Tick Create for each KiwiSaver Employer Contribution you want to copy.
Enter a Code and Description.
Click OK to complete the process.
The Current Tax Year will update to show 1/4/2026 to 31/3/2027.
Confirm the Change Tax Year
To confirm you have changed the tax year, go to Payroll, Maintenance, General, General Parameters and select the Tax Year tab. After the change tax year has been completed, the details are updated to 2026-2027, ready for your new financial year.
To check you have the correct pay end date for the first pay in the new financial year, go to Payroll, Maintenance, General, Pay Frequencies. All previous financial year period end dates have been cleared and the first pay for the new financial year will be available. This date should be 1 April 2026 or later. If necessary, edit the frequency, update the Period End Date and click OK to save.
KiwiSaver Employee Contributions
To update the employee contribution, either:
Option One - Create a new employee contribution and attach your employees.
Slightly more work, as you will need to attach the deductions to the funds
Retain a description that matches the contribution percentage that was current at the time of the deduction.
Will maintain a 3% deduction for employees who apply for a temporary rate reduction.
Option Two - Update the existing employee contribution.
Less initial setup work.
Consider the description and how it affects deductions from previous years. E.g. if you change the description to include 3.5%, the updated description, including the percentage, will display on reports for deductions made in previous years at the old 3% rate.
Will need to create a 3% deduction for employees who apply for a temporary rate reduction.
For the changes to take effect from the first period paid in April, you will need to update your employee records after completing the last pay in the 2025-2026 financial year but before entering transactions for the first pay in the 2026-27 financial year.
To find employees affected by this change, run the IQB-Emp007 - Payroll Employee Superannuation Details (Report) from Common, IQ.
Option One - Create a new Employee Contribution Deduction
Go to Payroll, Maintenance, General, Additions and Deductions.
Select the existing 3% contribution, right-click and Copy.
Update the Code, Shortcut Key and Description.
Leave Percent blank. You specify this on the employee record.
Make any required changes and ensure Employee Contribution is ticked.
Click OK to save the new contribution.
Repeat these steps for each 3% deduction.
Attach the Deduction to the Super Fund
Go to Payroll, Maintenance, Superannuation, Fund.
Edit the fund.
On the Employee Contributions tab, click Select.
Select the new Code from the grid and click OK.
Click OK again to save.
Repeat these steps for each fund that has a 3% employee contribution.
Attach the Deduction to the Employee's Superannuation Details
Go to Payroll, Maintenance, Employees, Employees.
Edit the Employee.
Select Superannuation Details.
Highlight the fund at the top of the screen and then click Add under the Superannuation Contributions section.
Select the Employee radio button.
From the Employee Contribution dropdown, select the deduction code.
Enter the Percentage.
Click OK to save the contribution.
Highlight the old contribution and click Delete. Delete will only be available if the deduction hasn't been used in the current financial year.
Then click OK to save the employee record.
Repeat for each employee.
Option Two - Update the existing Employee Contribution Deduction
Go to Payroll, Maintenance, General, Additions and Deductions.
Edit the existing 3% contribution.
Update the Description.
Leave Percent blank. You specify this on the employee record.
Make any required changes and ensure Employee Contribution is ticked.
Click OK to save the new contribution.
Repeat these steps for each 3% deduction.
Attach the Deduction to the Employee's Superannuation Details
Go to Payroll, Maintenance, Employees, Employees.
Edit the Employee.
Select Superannuation Details.
Highlight the employee contribution at the bottom of the screen and then click Edit under the Superannuation Contributions section.
Update the Percentage.
Click OK to save the contribution.
Then click OK to save the employee record.
Repeat for each employee.