NZ Student Loan Repayment Calculator
Project NZ student loan repayments using 2026 thresholds: 12% of every dollar above NZ$24,128 income.
NZ Student Loan Repayment Basics
New Zealand's student loan system is income-contingent — you repay 12% of every dollar you earn above the annual threshold (NZ$24,128 for 2026, or NZ$464 per week). Repayments are deducted automatically via PAYE for employees, and via provisional tax for self-employed. NZ-based borrowers pay 0% interest on the loan balance — only inflation-tied write-down (currently nil).
Overseas-based borrowers (away from NZ for 184+ consecutive days) face: (1) interest at 4.4% on the balance for 2026, and (2) fixed annual repayment schedule based on loan size (NZ$1,000-$5,000 depending on balance tier), not income-contingent. Source: ird.govt.nz Student Loan 2026. Last updated: May 2026.
2026 Repayment Thresholds
| Period | Threshold |
|---|---|
| Annual | NZ$24,128 |
| Weekly | NZ$464 |
| Fortnightly | NZ$928 |
| Monthly | NZ$2,011 |
| Repayment rate | 12% of excess |
Voluntary Extra Repayments: There Is No Longer a Bonus
New Zealand did once pay a bonus on voluntary extra repayments — 10% on payments of NZ$500 or more above your obligation, introduced 1 April 2009. It was repealed from 1 April 2013 by the Student Loan Scheme (Budget Measures) Amendment Act 2012, on the finding that it was not producing faster repayment — take-up came mostly from borrowers who were already paying their loans down quickly. Any calculator or blog still promising you a repayment bonus is more than a decade out of date, so do not plan around one.
Extra repayments are still worth making, for a different reason: NZ-based borrowers pay 0% interest, so every voluntary dollar reduces principal one-for-one with nothing accruing against it. There is no penalty for early repayment. The trade-off is purely opportunity cost — against a 0% loan, money invested instead will usually out-earn prepayment over a long horizon, so prepayment is mainly a case for people who want the balance gone. If you are overseas-based and paying 4.4% interest, prepaying is a guaranteed 4.4% return and the calculus flips. Updated 2026-07-31.
NZ Student Loan Repayment Calculator: Salary Examples and Years-to-Payoff
How long until your NZ student loan is paid off? It depends entirely on salary above the threshold. At NZ$50,000 salary with a NZ$30,000 starting balance, compulsory PAYE deductions are 12% × ($50,000 − $24,128) = NZ$3,105/year, paying off in ~9.7 years (interest-free if NZ-based). At NZ$70,000 salary, deductions jump to NZ$5,505/year, payoff in ~5.5 years. At NZ$100,000 salary, deductions are NZ$9,105/year, payoff in ~3.3 years. Add a NZ$1,000/year voluntary repayment and it comes straight off principal, shaving roughly 3-4 months off any of these scenarios (there is no bonus credit — that scheme ended in 2013). Per the IRD Student Loans portal, the median NZ graduate takes 7.4 years to clear their loan — those who voluntarily prepay clear it faster. This calculator's "Total Interest if Overseas" output shows the cost difference if you leave NZ mid-payoff (4.4% interest kicks in after 184 days away). The break-even point for "should I prepay or invest" sits near the 4.4% overseas-borrower rate; for NZ-based 0% borrowers, an index-fund return on the same money will usually beat prepayment over 10+ years.
Two Jobs, SL Tax Codes and the End-of-Year Bill Nobody Expects
The NZ$24,128 threshold is applied per pay period, per employer — not once across your total income. That single detail produces most of the surprise student-loan bills in New Zealand. Work one job and PAYE deducts 12% of what you earn above the pro-rated threshold in each pay, and the year ends square. Add a second job on an SL secondary tax code and the threshold is not applied again, so 12% comes off from the first dollar of that income — you over-pay through the year. Leave the SL off the secondary code and the opposite happens: the deduction never starts, and Inland Revenue issues a significant under-deduction assessment after year end for the shortfall.
Neither outcome is a penalty for doing something wrong; both are just the mechanics of a per-pay threshold meeting a two-job reality. What you can do is ask Inland Revenue for a special deduction rate so the correct percentage is applied across both incomes during the year, or a repayment deduction exemption if your total income sits below the annual threshold even though one pay period crossed it. Both are requested through myIR before the income is earned, not afterwards.
Two practical checks. If your income is uneven — seasonal work, variable shifts, a bonus month — a single large pay can push one period over the threshold and trigger a deduction even when your annual income is under it; that money is refundable, but only if you file. And if you are moving overseas, tell Inland Revenue before you go: the switch from income-based repayments to the fixed overseas-based obligation is what triggers the interest and the fixed annual amounts, and being assessed late is how borrowers end up in default. Current rules and thresholds are on the Inland Revenue student loans pages. Updated 2026-08-26.
Overseas-Based Borrowers: The 4.4% Interest Trap
If you leave NZ for 184+ consecutive days, you become overseas-based for student loan purposes. Consequences: (1) interest of 4.4% accrues on your balance, (2) repayment becomes a fixed annual schedule (not income-contingent), (3) compliance is enforced — failure to pay can result in arrest warrants at NZ borders, asset freezes, and credit-record damage.
If you plan to live overseas long-term, consider paying off the loan AGGRESSIVELY before leaving. Bringing the balance to zero stops all interest and reporting obligations. Otherwise the loan compounds even when you can't see it.
Overseas-Based Fixed Annual Repayment Schedule (2026)
Once you become overseas-based, NZ IRD switches you from income-contingent PAYE to a fixed annual repayment schedule keyed to your loan balance. The amount is not negotiable and does not consider your overseas income. Check the table below before booking your one-way flight — a NZ$60,000 balance suddenly costs NZ$3,000/year regardless of whether you are underemployed or earning six figures overseas.
| Loan Balance | Fixed Annual Repayment (2026) | Interest (4.4%/yr) | Net Balance Reduction/yr |
|---|---|---|---|
| Under NZ$1,000 | Full balance | Minimal | Full payoff |
| NZ$1,000 – 15,000 | NZ$1,000 | Up to NZ$660 | NZ$340 – 1,000 |
| NZ$15,000 – 30,000 | NZ$2,000 | NZ$660 – 1,320 | NZ$680 – 1,340 |
| NZ$30,000 – 45,000 | NZ$3,000 | NZ$1,320 – 1,980 | NZ$1,020 – 1,680 |
| NZ$45,000 – 60,000 | NZ$4,000 | NZ$1,980 – 2,640 | NZ$1,360 – 2,020 |
| Above NZ$60,000 | NZ$5,000 | NZ$2,640+ | NZ$2,360 – 2,360- |
A NZ$45,000+ balance can barely keep up with the 4.4% interest at the mandatory NZ$4,000/year — you may pay for a decade and still owe the original balance. Overseas-based borrowers earning well should voluntarily prepay beyond the minimum to actually shrink the loan. Verified against IRD Student Loans — Going Overseas. Updated 2026-07-15.
Frequently Asked Questions
What is the NZ student loan repayment threshold for 2026?
NZ$24,128 annually (NZ$464 per week). Every dollar you earn above this threshold attracts 12% loan repayment, deducted automatically via PAYE. Below NZ$24,128 income, you have zero compulsory repayment for the year.
Does NZ student loan accrue interest?
Not for NZ-based borrowers — interest rate is 0% as long as you remain resident in NZ. Overseas-based borrowers (away 184+ consecutive days) face 4.4% interest in 2026. This makes NZ one of the best student loan deals in the developed world for those who stay home.
How do I make extra repayments to NZ student loan?
Log into myIR via the IRD website or app and make a voluntary payment toward your loan. You can also pay via direct deposit using your IRD-issued bank reference. There is no bonus on voluntary repayments — the 10% bonus was repealed from 1 April 2013 by the Student Loan Scheme (Budget Measures) Amendment Act 2012. Extra payments are still useful because NZ-based borrowers accrue 0% interest, so every voluntary dollar comes straight off principal.
What happens if I move overseas with NZ student loan debt?
After 184 consecutive days overseas you become overseas-based: 4.4% interest accrues on the balance, repayments become fixed-schedule (not income-contingent), and there are stricter enforcement mechanisms. Notify IRD before leaving and confirm your obligations. Failure to repay can lead to enforcement action at NZ borders on return.
Can NZ student loans be written off?
Generally no — there's no time-based forgiveness (unlike US PSLF or AU after age 65). Loans are written off only on death (the loan is written off, debt doesn't transfer to estate) or in rare cases of permanent disability under strict criteria. Most borrowers fully repay over 10-20 years.
Should I prepay my NZ student loan or invest the money?
If NZ-based with 0% interest: investing typically wins long-term (S&P 500 historical average ~10% vs 0% loan cost). There is no prepayment bonus to tip the scales — the 10% voluntary-repayment bonus was repealed from 1 April 2013 — so the case for prepaying is the psychological freedom of being debt-free rather than any credit from IRD. If overseas-based at 4.4% interest, prepayment usually beats taxable investing — guaranteed return equal to the rate.
How many years until my NZ student loan is paid off?
It depends on salary. With a NZ$30,000 starting balance: at NZ$50,000 salary, payoff is ~9.7 years (NZ$3,105/year compulsory). At NZ$70,000 salary, ~5.5 years (NZ$5,505/year). At NZ$100,000 salary, ~3.3 years (NZ$9,105/year). Add a NZ$1,000 voluntary repayment and it comes straight off principal, shaving roughly 3-4 months off these figures. There is no bonus on voluntary repayments — the 10% bonus was repealed from 1 April 2013 by the Student Loan Scheme (Budget Measures) Amendment Act 2012. NZ-based borrowers pay no interest, so every repayment dollar reduces principal directly.
Does the NZ student loan repayment calculator handle PAYE deductions automatically?
Yes — for NZ-based employees, the calculator models the 12% PAYE deduction on income above the NZ$24,128 threshold, exactly as IRD applies it through your employer's payroll system. Enter your annual salary and the calculator shows weekly/fortnightly/monthly deductions matching your payslip. For self-employed borrowers, repayments are paid through provisional tax — the same 12% rate applies but you remit it yourself. The calculator's output equals the compulsory amount; you can add voluntary extras on top, which reduce principal directly. There is no bonus on voluntary repayments — the 10% bonus was repealed from 1 April 2013 by the Student Loan Scheme (Budget Measures) Amendment Act 2012.
How much do overseas-based NZ student loan borrowers repay each year?
Overseas-based borrowers pay a fixed schedule based on loan balance, not income: NZ$1,000/year for balances under NZ$15,000, NZ$2,000 for NZ$15,000-30,000, NZ$3,000 for NZ$30,000-45,000, NZ$4,000 for NZ$45,000-60,000, and NZ$5,000 above NZ$60,000. Add 4.4% interest per year on the balance. Loans above NZ$45,000 barely shrink at the minimum — many overseas borrowers voluntarily prepay above the minimum to actually reduce the balance. Source: IRD Student Loans overseas guidance.
Is it worth prepaying my NZ student loan while on 0% interest?
The math usually favours investing over prepayment for NZ-based (0% interest) borrowers. A NZ index fund averaging 7-9% long-term beats a 0% loan by a wide margin. There is no bonus on voluntary repayments — the 10% bonus was repealed from 1 April 2013 by the Student Loan Scheme (Budget Measures) Amendment Act 2012. With no bonus and no interest, prepayment for an NZ-based borrower returns exactly 0% in financial terms, so investing wins on the maths. The behavioural argument still stands — being debt-free before age 30 makes career risk-taking (founding something, a sabbatical) easier than a lingering balance does. A reasonable split: pay the compulsory PAYE amount, invest the surplus, and prepay only if the balance genuinely bothers you. If you move overseas and start paying 4.4% interest, prepay first.
Why did I get a student loan bill when PAYE already deducted repayments?
Because the NZ$24,128 threshold is applied per pay period and per employer, not once across your total income. On a second job with an SL secondary tax code, 12% comes off from the first dollar, so you over-pay; leave the SL off that code and nothing is deducted at all and Inland Revenue issues a significant under-deduction assessment after year end. Ask Inland Revenue through myIR for a special deduction rate so the right percentage applies across both incomes during the year.
My income is uneven — can one big pay trigger a repayment I do not owe?
Yes. Because the threshold is pro-rated per pay period, a single large or seasonal pay can push one period above it and trigger a 12% deduction even if your annual income finishes below the threshold. The over-deduction is refundable, but only if you file, so check your end-of-year assessment rather than assuming PAYE settled it. A repayment deduction exemption requested in advance avoids the problem for borrowers who expect to stay under the annual threshold.