Government Contribution — $260.72 Per Year

What Is the Government Contribution?

The Government pays up to $260.72 into your KiwiSaver account each year. This is formally called the Member Tax Credit (MTC). Since 1 July 2025, the Government matches 25 cents for every dollar you contribute yourself — halved from the previous 50 cents and $521.43 maximum. It is still one of the best risk-free returns available in New Zealand.

How the $260.72 Is Calculated

The Government matches 25% of your own contributions, up to a maximum of $260.72 per year. To get the full amount, you need to contribute at least $1,042.86 of your own money during the contribution year (1 July to 30 June).

• Your contribution: $1,042.86 per year
• Government adds: $260.72 (25% match)
• Total extra: $1,303.58 in your account

Contribute less and you still get 25 cents per dollar — e.g. $500 of your contributions earns $125 from the Government. Every little bit counts.

Do I Qualify? (2026 Rules)

You qualify for the government contribution if you:

• Are aged 16 or over (lowered from 18 on 1 July 2025)
• Earn an annual taxable income of $180,000 or under (new income cap from 1 July 2025)
• Are a New Zealand resident (normally living in NZ)
• Have made contributions to your KiwiSaver account during the year
• Have not yet reached 65 and started withdrawing

If you join, turn 16, or turn 65 part-way through the year, your entitlement is calculated pro-rata based on the days you were eligible.

How to Get the Full $260.72

Most employees earning at least $29,796 per year at the 3.5% contribution rate will automatically exceed the $1,042.86 threshold. If you earn less, work part-time, or are self-employed, you may need to make a voluntary top-up contribution before 30 June to reach the threshold.

When Is It Paid?

The government contribution is calculated at the end of each contribution year (30 June) and typically paid into your KiwiSaver account by the end of August. You don't need to apply — it's automatic.

Important Notes

• The cap is $260.72 regardless of how much you contribute above $1,042.86
• The contribution doesn't carry over — use it or lose it each year
• Only your own employee and voluntary contributions count toward the $1,042.86 threshold — employer contributions, past government contributions, and Australian-scheme transfers do not
• Members earning over $180,000 receive nothing, no matter how much they contribute

Common Mistakes

• Assuming the old $260.72 is still available — the maximum has been $260.72 since 1 July 2025.
• Making voluntary contributions after 30 June and expecting them to count — they roll into the next contribution year.
• Counting employer contributions toward the threshold — only your personal contributions count.
• High earners assuming they qualify — if your taxable income exceeds $180,000, you're not eligible at all.

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