Summary
ACC (Accident Compensation Corporation) is New Zealand’s universal no-fault accident insurance scheme — covering medical costs, income replacement and rehabilitation for anyone injured in New Zealand, regardless of fault — established under the Accident Compensation Act 2001, ACC is unique globally: it covers all residents and visitors to New Zealand for personal injury from any cause — whether the accident was your fault, someone else’s fault or nobody’s fault; in exchange, New Zealanders and those covered by ACC give up the right to sue for personal injury in most circumstances. To better understand this system, it’s important to know what is ACC New Zealand.
The ACC earner’s levy for 2026-27 is 1.75% of your gross earnings up to $156,641 — giving a maximum levy of $2,741.22 per year — this is an increase from 2025-26 (1.67%, capped at $152,790, maximum $2,551.59); the levy is deducted automatically through PAYE alongside income tax; on most payslips, it is embedded within the single PAYE figure rather than shown as a separate line; self-employed people are invoiced by ACC directly after filing their IR3 tax return
ACC covers four accounts funded by four separate levies — the earner’s levy (paid by employees and the self-employed) covers non-work injuries; the work levy (paid by employers) covers work-related injuries; the motor vehicle levy (paid via rego and petrol) covers road accidents; and the working safer levy (paid by employers) funds WorkSafe NZ; as an employee, you only see the earner’s levy come out of your pay — the other levies are paid by your employer or through other mechanisms
If you have looked at a New Zealand payslip and wondered why the PAYE deduction is slightly higher than expected — ACC is part of the answer. The earner’s levy is embedded in PAYE alongside income tax and is not always shown as a separate line. Understanding what it is, what it covers and what you get in return is useful for anyone working in New Zealand.
What is ACC?
The Accident Compensation Corporation (ACC) is a New Zealand Crown entity that administers New Zealand’s universal accident compensation scheme.
What makes it unusual globally: Almost every other country with a public healthcare system still requires injured people to prove fault and sue for compensation in order to recover income replacement and rehabilitation costs from accidents. New Zealand’s ACC system eliminates this entirely — it does not matter how you were injured or who was responsible. If you are injured in New Zealand and the injury is covered, ACC pays.
The trade-off: By accepting ACC coverage, New Zealanders and those covered by the scheme give up the right to sue for personal injury in most circumstances. This is embedded in the Accident Compensation Act 2001.
Who is covered: All New Zealand residents, including migrants on most visa types, and visitors to New Zealand, are automatically covered from the moment they arrive. You do not apply for ACC coverage — it is universal and immediate.
The four ACC accounts and levies
ACC is funded through four separate accounts, each with its own levy:
| Account | What it covers | Who pays the levy |
|---|---|---|
| Earners’ Account | Non-work injuries for employed and self-employed people | Employees and self-employed |
| Work Account | Work-related injuries | Employers (and self-employed separately) |
| Motor Vehicle Account | Road accident injuries | All via rego and petrol levy |
| Working Safer Levy | WorkSafe New Zealand operations | Employers |
As an employee, the only ACC levy you see deducted from your pay is the earner’s levy — the others are paid by your employer or through vehicle registration and fuel.
The ACC earner’s levy — rates and how it works
2026-27 rate (from 1 April 2026)
| 2026-27 | 2025-26 | |
|---|---|---|
| Levy rate | 1.75% | 1.67% |
| Maximum liable earnings | $156,641 | $152,790 |
| Maximum annual levy | $2,741.22 | $2,551.59 |
The levy is a flat percentage applied to your earnings up to the maximum liable earnings threshold. Earnings above $156,641 are not levied — the cap exists because weekly ACC compensation is itself capped, so ACC stops levying at roughly the point it stops insuring.
How it is calculated
Formula: Annual levy = min(gross earnings, $156,641) × 1.75%
Examples:
- Earning $50,000: $50,000 × 1.75% = $875 per year (~$16.83 per week)
- Earning $100,000: $100,000 × 1.75% = $1,750 per year (~$33.65 per week)
- Earning $200,000: $156,641 × 1.75% = $2,741.22 per year (capped)
How it appears on your payslip
For most employees, the ACC earner’s levy is not shown as a separate line on your payslip — it is embedded within the total PAYE deduction. Inland Revenue’s instruction to employers is clear: “PAYE includes ACC earners’ levy already, so no extra calculations are needed.”
You can see the levy broken out in IRD’s published PAYE tables and in some payroll software that itemises it separately — but most standard payslips show a single combined PAYE figure.
Self-employed
Self-employed people pay the earner’s levy differently. IRD calculates the levy based on your taxable income from your IR3 return and ACC invoices you directly — typically after your tax return is filed. Self-employed people also pay a separate work levy on top of the earner’s levy, at a rate that varies by industry (reflecting the injury risk of different types of work).
What ACC covers
If you are injured in New Zealand and the injury is covered by ACC, it can pay for:
Medical treatment costs:
- GP visits, specialist consultations, hospital treatment
- Surgery and follow-up care
- Physiotherapy, occupational therapy and other rehabilitation
- Prescription medicines related to the injury
Income replacement (weekly compensation):
- If your injury means you cannot work, ACC can pay 80% of your pre-injury income from the second week of incapacity
- Weekly compensation is capped at $2,466.20 gross per week (2026)
- The first week of incapacity is not covered (employers are generally required to pay for this under the Holidays Act)
Rehabilitation:
- Home modifications if required
- Vocational rehabilitation — retraining if you cannot return to your previous occupation
- Social rehabilitation — support returning to daily activities
Death — survivors’ support:
- Lump sum payment to surviving spouse or partner
- Weekly compensation for surviving dependent children
- Funeral grant
What ACC does NOT cover
ACC covers personal injury by accident — it does not cover everything:
Not covered:
- Illness and disease (unless caused or materially contributed to by work — some occupational diseases are covered)
- Mental injury caused by a gradual process (though mental injury caused by a sudden traumatic event may be covered)
- Self-inflicted injuries (in most circumstances)
- Injuries that occurred outside New Zealand (some cover may apply for NZ residents temporarily overseas)
Workplace injuries from gradual process — repetitive strain injuries and gradual-onset conditions have more complex coverage rules; ACC assesses these individually.
For illnesses not covered by ACC, New Zealand’s public health system (funded through general taxation) provides healthcare through district health board hospitals and subsidised GP visits.
How to make an ACC claim
Making an ACC claim is straightforward for most injuries:
- See a health provider — a GP, A&E department, physiotherapist or other relevant provider
- The provider lodges the claim — in most cases, your health provider completes and submits the ACC claim on your behalf; you do not need to lodge it yourself
- ACC assesses the claim — most standard injury claims are accepted quickly; ACC may request further information for complex cases
- Treatment and compensation begin — once accepted, ACC pays for covered treatment directly to providers; weekly compensation is paid to you if you cannot work
If your claim is declined: ACC’s decisions can be reviewed. You can request a review from ACC, and if still declined, appeal to the District Court.
ACC and migrants — what you need to know
You are covered immediately. ACC coverage is automatic — you do not apply for it. From the moment you are legally in New Zealand, whether on a work visa, student visa, working holiday or any other valid status, you are covered for accidents.
You pay the earner’s levy from your first payslip. The levy is deducted through PAYE from the first day you are employed in New Zealand — and coverage begins from that same moment.
Visitors are covered too. Even tourists visiting New Zealand are covered by ACC for injuries that occur during their visit.
Cannot opt out. ACC is compulsory and universal — there is no opt-out option. The levy is a non-negotiable PAYE deduction.
Private insurance still available. ACC covers accidents but not illness; many New Zealand workers take out private health or income protection insurance alongside ACC to cover illness, disease and other gaps.
FAQs (frequently asked questions)
What is ACC in New Zealand?
The Accident Compensation Corporation — New Zealand’s universal no-fault accident insurance scheme. Covers medical treatment, income replacement and rehabilitation for anyone injured in New Zealand, regardless of who was at fault. Funded through earner, employer, motor vehicle and working safer levies.
What is the ACC earner’s levy for 2026-27?
1.75% of gross earnings up to $156,641 — maximum levy of $2,741.22 per year. Deducted through PAYE alongside income tax.
Why can’t I see ACC separately on my payslip?
For most employees, the earner’s levy is embedded in the total PAYE figure. IRD instructs employers that “PAYE includes ACC earners’ levy already.” Some payroll systems do show it separately.
Does ACC cover illness?
Generally no — ACC covers personal injury by accident, not illness or disease (with some exceptions for occupational diseases caused by work). Illness is covered through the public health system and, optionally, private health insurance.
Do I have to pay ACC as a migrant?
Yes — the earner’s levy is deducted from all salary and wages earned in New Zealand regardless of visa type. Coverage is also automatic and immediate.
What does ACC pay if I cannot work?
80% of your pre-injury gross income from the second week of incapacity, capped at $2,466.20 gross per week.
Is ACC the same as health insurance?
No — ACC covers accidents only, not illness. It is not a substitute for health insurance. Many New Zealanders hold private health insurance alongside ACC to cover non-accident medical needs.
Related guides
- What is KiwiSaver? →
- What is an IRD number? →
- What is GST in New Zealand? →
- What is Working for Families? →
This guide is for general information only. ACC levies, rates and coverage rules change — always verify at acc.co.nz and ird.govt.nz. Last updated September 2026.
Sources: calculate.co.nz — NZ ACC Levy Rates 2026/27 (June 2, 2026) | nztax.tools — ACC Earner’s Levy 2026-27: New 1.75% Rate (June 7, 2026) | nztax.tools — ACC Earner’s Levy Explained (April 5, 2026) | kiwiworth.co.nz — ACC Earner Levy NZ Explained 2026-27 (June 17, 2026) | quotehub.co.nz — ACC Earner’s Levy NZ (1 month ago) | moneybalance.co.nz — ACC Levy Guide NZ 2026 (June 26, 2026) | bettermoney.co.nz — ACC Levy Explained | ACC — Accident Compensation Corporation (acc.co.nz official)
