Question 1

What are the PIR tax rates 2027?

Accepted Answer

The Prescribed Investor Rate (PIR) has three tiers for NZ residents: 10.5% (income up to NZ$14,000 with PIE income ≤NZ$48,000); 17.5% (income NZ$14,001-48,000 with PIE income ≤NZ$70,000); 28% (everyone else and non-residents). Choosing the wrong PIR can cost you tax — too low you pay more at year-end; too high you can't get a refund.

Question 2

How do I choose the correct PIR?

Accepted Answer

Use the IRD two-year income test. Look at your taxable income (excluding PIE) in BOTH of the past two years. Take the LOWER of the two years. Then test: if income ≤ NZ$14,000 and PIE income ≤ NZ$48,000 = 10.5% PIR; if income ≤ NZ$48,000 and PIE+income ≤ NZ$70,000 = 17.5% PIR; otherwise 28% PIR. Tell your KiwiSaver / fund provider to update.

Question 3

What happens if my PIR is wrong?

Accepted Answer

If your PIR is too LOW (you should be on 28% but are on 17.5%), at year-end IRD will issue a tax bill for the underpayment. If your PIR is too HIGH, IRD CANNOT refund the overpayment for income years 2020 onward — overpaying is a permanent loss. Always err on the side of slightly lower PIR within IRD's rules to avoid the no-refund trap.

Question 4

Does the PIR apply to all KiwiSaver providers?

Accepted Answer

Yes — KiwiSaver schemes are PIEs and tax investment income at your declared PIR. Other PIEs include retail unit trusts, managed funds, listed PIEs (LPF), and superannuation schemes. Term deposits are NOT PIEs — they use Resident Withholding Tax (RWT) at your normal marginal rate (10.5/17.5/30/33/39%).

Question 5

Are PIE distributions taxed when paid out?

Accepted Answer

No — PIE investment income is taxed inside the fund at your PIR. When you withdraw or receive a distribution, it is tax-free (already taxed). For KiwiSaver retirement withdrawal at 65, no further tax applies. This is one of the main attractions of PIE-structured funds — final tax treatment, no need to declare in IR3 if PIR is correct.

Question 6

What is PIE income for the PIR test?

Accepted Answer

PIE income is the investment income attributed to you from PIE funds — KiwiSaver returns, managed fund returns, listed PIE distributions. It is reported to IRD by your provider. Your PIR test uses PIE income + other taxable income to determine which bracket applies. PIE distributions you've already received are part of this calculation.

PIR 2027 Calculator (NZ PIE Tax Rate)

What is the Prescribed Investor Rate (PIR)?

How the IRD two-year test works

Example: part-time worker with KiwiSaver

How to use this PIR calculator