July 16, 2026

Secondary tax codes NZ: how to choose the right one

BusinessTax

Secondary tax in NZ ranges from 10.5% to 39%, depending on your total income from all sources. The right code (S, SH, ST, SB, or SA) makes sure you’re paying the right rate and not getting a year-end surprise. Here’s how to choose.

If you’ve picked up extra hours, a second job, or seasonal work, the PAYE tax can feel punishing. You just want a simple answer to “how much should I be paying?” The good news: it isn’t additional tax. Secondary tax codes help keep PAYE deductions accurate across every source of income.

Quick summary

Secondary tax codes apply to any income source that isn’t your highest-paying job. Inland Revenue sets five codes: SB, S, SH, ST and SA, with flat rates from 10.5% to 39%. The correct tax code depends on your total income from all sources, not just what the second job pays.

Using the right code means you pay the right amount of tax through the year. And you don’t pay more tax overall than someone earning the same total from one job.

Secondary tax codes explained

A secondary tax code tells the payer of your second income how much PAYE tax to deduct, based on your total income. Inland Revenue publishes five codes, each matching a flat secondary tax rate between 10.5% and 39%.

New Zealand taxes income in layers, so your income is taxed at rising rates as it climbs the brackets. Your main employment income already uses up the lower layers. Any second source of income lands straight in the higher tax brackets, so it’s taxed at a higher rate from the first dollar. That may feel a bit steep on payday, but it’s simply about paying the right amount of tax.

The most common tax code for your main job is M. Everything else has its own. This includes a benefit, NZ Super, paid parental leave, or an ACC payment.

Secondary tax codes and rates for the 2026 tax year

For the 2026 tax year, secondary tax codes range from SB at 10.5% to SA at 39%. Which code applies comes down to one number: your expected total income for the tax year.

Inland Revenue’s tax codes and rates table sets these thresholds.

Total annual income (all sources)	Secondary tax code	Rate
$15,600 or less	SB	10.5%
$15,601 to $53,500	S	17.5%
$53,501 to $78,100	SH	30%
$78,101 to $180,000	ST	33%
Over $180,000	SA	39%

Rates exclude the ACC earner levy. The SB tax code is for when total income is very small. The ST tax code that NZ earners commonly use covers most full-time salaries plus a solid second income.

If you have a student loan, then add SL to your code. There are also special codes, like EDW for election day workers, and tailored tax codes when the flat rates don’t fit.

Choosing the correct tax code takes three steps

There’s no single best secondary tax code: the right one matches your total income. Simply follow three steps, drawn from Inland Revenue’s IR330 tax code declaration:

Add up your expected total income for the tax year, from every source.
Find your band in the table above.
Give your payer a completed IR330 so the code applies from your next pay.

Three worked examples:

Full-time plus part-time. You earn $60,000 in your main job and $10,000 from weekend work. Total income is $70,000, so the second job uses SH at 30%.
Full-time plus seasonal work. You’re on $62,000 and expect $9,000 from kiwifruit season. That’s $71,000, still the SH band.
NZ Super plus part-time work. Your Super and wages total $48,000. The part-time job uses S at 17.5%.

A wrong tax code catches up with you at year-end

Use the wrong tax code and the gap lands on you after 31 March, when Inland Revenue squares up the tax year. Too low means a tax bill you weren’t budgeting for. Too high means you’ve been overpaying income tax all year.

Checking just takes minutes. Inland Revenue lists every tax code for secondary income NZ workers can use. An accountant can confirm your pick in one short chat.

Frequently asked questions

What is the secondary tax code in NZ?

It’s the code your second payer uses to deduct PAYE at a flat rate matched to your total income. There are five secondary tax codes NZ uses: SB, S, SH, ST and SA.

What is the tax code for secondary tax?

The code matches your total annual income band: SB up to $15,600, S to $53,500, SH to $78,100, ST to $180,000, and SA above that.

What tax code should I use for the second job?

Use the code that matches your combined income from both jobs, not the second job’s pay alone. A $60,000 main job plus $10,000 second job means $70,000 total, so SH.