Home/ Tax & Pay/ Paid Parental Leave
Tax Calculator

Free Paid Parental Leave Calculator for New Zealanders

NZ Paid Parental Leave is paid at the lesser of your average weekly pre-leave earnings or the statutory cap ($788.66/week for 2026/27). It is taxable and runs for up to 26 weeks.

Your parental leave

$1,200
$
$300$3k
26
026
After-tax total
$16,914
Over 26 weeks

Based on $1,200/week earnings, capped at $788.66/week, over 26 weeks.

Weekly entitlement (capped)$789
Gross total$20,505
Tax (M code, 17.5%)$3,588
After-tax total$16,914

About our Paid Parental Leave Calculator

NZ Paid Parental Leave caps at $788.66 per week gross for 2026/27, paid by Inland Revenue for up to 26 weeks. For employees earning under about $41,000 a year, PPL pays close to their normal weekly earnings. For higher earners, the cap creates a meaningful income gap that some employers fill with a contractual top-up.

The calculator returns the weekly amount, total over the eligible weeks, and the after-tax figure. Employer top-ups, where they exist, are added on top.

How to use it

Enter your annual gross income (or your average weekly earnings for the 26 weeks before the leave starts, if income is irregular). The calculator returns the weekly PPL, the total over the eligible weeks, and the after-tax landing figure.

Why use it

Knowing the gap between PPL and normal income helps with budgeting around the leave period. Many couples plan to share the leave, take partial leave, or supplement with savings, and the calculator gives the dollar figures to plan against.

The maths behind it

Formula: Weekly PPL = min(Average weekly earnings, Statutory cap)

Paid Parental Leave (PPL) pays the lesser of your average weekly earnings (over the 26 weeks before the leave starts) and the statutory cap. The 2026/27 cap is $788.66 per week gross. PPL runs for up to 26 weeks. PAYE applies the same way as ordinary wages; ACC and KiwiSaver also apply during the leave.

Worked example

Tania, midwife in Cromwell, taking 26 weeks PPL on her usual $76,000 salary.

Tania’s average weekly pre-leave earnings: $76,000 ÷ 52 = $1,462. The 2026/27 PPL cap is $788.66, well below her earnings.

Weekly PPL: $788.66 (the cap). Over 26 weeks, the gross PPL total is $20,505.

After PAYE (at her ordinary tax bracket rate of 17.5% on this slice), ACC, and KiwiSaver, she takes home around $15,800 over the 26 weeks. Her usual salary at $76,000 would have produced about $30,000 of take-home over the same period; PPL fills roughly half the income gap.

Things to keep in mind

  • Cap can bite for higher earners. PPL is capped at $788.66/week (2026/27). For employees earning more than $41,010/year, the cap reduces the weekly payment below their average earnings. Higher-earning parents experience a larger gap between PPL and their normal pay.
  • 26 weeks maximum. The maximum PPL period is 26 weeks. Some employers top up PPL with paid parental leave from their own funds; others do not. Check the employment agreement for any contractual top-up.
  • Eligibility requires 26 weeks employed. PPL eligibility requires having been employed (with the same or different employers) for at least 26 of the 52 weeks before the leave starts. New employees may not yet meet the test.
  • KiwiSaver continues if elected. Employee KiwiSaver contributions can continue to be deducted from PPL if requested. The employer match also applies to PPL pay if the employee continues contributing.

NZ-specific notes

IRD
PPL rates 2026/27. Weekly cap of $788.66 (gross), payable for up to 26 weeks. The cap is reviewed annually each 1 July.
Source
Employment NZ
Eligibility and process. Employees apply through Inland Revenue. The employer is notified through the IRD payday-filing process; the employer does not pay PPL out of their own funds (IRD pays directly).
Source
IRD
Self-employed PPL. Self-employed people who meet the work-test (average 10+ hours/week over 26 of the 52 pre-leave weeks) can also claim PPL, calculated on their pre-leave business income.
Source
Work and Income
Best Start Tax Credit. BSTC pays an additional $73/week for the first year of a child’s life regardless of income, on top of PPL. After the child’s first birthday, BSTC continues with abatement above $79,000 family income.
Source

FAQs

How long does PPL run?

Up to 26 weeks. The weekly amount is capped at $788.66 gross for 2026/27. Employees can take PPL in one block or split between partners (with conditions).

Is PPL taxed like ordinary wages?

Yes. PAYE, ACC, KiwiSaver, and student loan all apply. The take-home figure is the gross PPL minus the same deductions you would face on regular pay.

Can I add my employer’s top-up?

Some employers offer a contractual top-up (e.g., bringing PPL up to 100% of normal pay for the first 6 weeks). Check your employment agreement; the top-up is paid from the employer’s own funds, on top of the IRD-paid PPL.

Can I work during PPL?

Limited "keeping in touch" days (up to 64 hours over the 26 weeks) are allowed without forfeiting PPL. More than that risks the leave being treated as ended.

References & sources

  1. Inland Revenue, "Paid parental leave (employer info)". ird.govt.nz
  2. Employment NZ, "Parental leave". employment.govt.nz
  3. Inland Revenue, "Self-employed parental leave". ird.govt.nz
  4. Work and Income, "Best Start Tax Credit". workandincome.govt.nz

Last reviewed

✓
Reviewed 6 May 2026, current to the 1 July 2025 PPL cap of $788.66/week, with the next review due 1 July 2026

Share your numbers

Tax & Pay Working for Families Family tax credits including BSTC. Tax & Pay Holiday Pay Annual leave during/around PPL. Tax & Pay Take-Home Pay Pre-PPL income comparison. Tax & Pay PAYG Holiday Pay 8% PAYG method. Tax & Pay Employer PAYE All-in employer cost. Tax & Pay NZ Super Income-replacement after retirement.
Disclaimer: This calculator is for information only and is not financial advice. Real PPL outcomes depend on the eligibility test, employer top-up arrangements, and any KiwiSaver continuation election. Calculator.org.nz is not a registered Financial Advice Provider. For specific PPL questions, contact Inland Revenue or check Employment NZ.