The 2026 KiwiSaver Changes, Explained
Since 1 April 2026 the minimum KiwiSaver contribution rate has risen to 3.5%, with a further rise to 4% due in April 2028. Government contributions have also been halved since 1 July 2025, and 16 and 17 year olds are now eligible for both government and employer contributions. Here is what the changes mean for your contributions, your government top up, and what you can do next.
What changed, and when
The Taxation (Budget Measures) Act 2025 introduced the biggest set of KiwiSaver changes since the scheme launched in 2007. Higher minimum contribution rates, reduced government support, and new eligibility rules have been phasing in since mid-2025, with the last change due in April 2028. If you have a KiwiSaver account, several of these changes already affect your pay slip and your annual government top up.
Timeline of the KiwiSaver changes
| Date | Change | Impact |
|---|---|---|
| 1 July 2025 | Government contribution halved | Maximum annual government contribution dropped from $521.43 to $260.72 |
| 1 July 2025 | $180,000 income cap introduced | Members earning above $180,000 no longer receive government contributions |
| 1 July 2025 | 16 and 17 year olds became eligible for government contributions | Younger members can now receive the government top up |
| 1 February 2026 | Temporary rate reduction applications opened | Members could apply via myIR to stay at 3% from 1 April |
| 1 April 2026 | Default contribution rate rose to 3.5% | Both employee and employer minimum contributions increased |
| 1 April 2026 | Employer contributions became compulsory for 16 and 17 year olds | Employers must now contribute for younger KiwiSaver members |
| 1 April 2028 | Default contribution rate rises to 4% | Second scheduled increase, for both employee and employer |
Source: Inland Revenue, KiwiSaver changes.
Your contribution rate has risen to 3.5%
From 1 April 2026, the minimum KiwiSaver contribution rate for both employees and employers rose from 3% to 3.5%. If you were contributing at the old 3% minimum, your rate increased automatically, you did not need to do anything.
A further increase to 4% is scheduled for 1 April 2028. If you already contribute at 4%, 6%, 8%, or 10%, none of this affects you, the increase only applies to members on the minimum rate.
| Rate | Employee contribution | Employer contribution | Combined annual |
|---|---|---|---|
| 3% (previous minimum) | $2,100 | $2,100 | $4,200 |
| 3.5% (current minimum) | $2,450 | $2,450 | $4,900 |
| 4% (from April 2028) | $2,800 | $2,800 | $5,600 |
On a $70,000 salary, the increase from 3% to 3.5% adds about $700 a year in total, split evenly between you and your employer. That works out to roughly $6.75 a week extra from your own pay, plus a matching amount from your employer. By 2028, once the rate reaches 4%, the combined increase reaches $1,400 a year compared with the old 3% rate.
Cannot afford the increase? You can apply for a temporary reduction
If the increase is not affordable right now, or you would rather direct your money elsewhere for a while, you can apply through myIR for a temporary reduction back to 3%. Applications opened on 1 February 2026, though the reduced rate could not start before 1 April 2026.
- The reduction can run for 3 to 12 months (a minimum of 92 days)
- You can apply again once a reduction period ends
- Your employer may choose to match your reduced rate, but is not required to
- You apply through myIR, receive a certificate, and show it to your employer
- You cannot apply if you already have an active KiwiSaver savings suspension
This option is designed as a safety valve for genuine affordability pressure, not a default choice, since a lower contribution rate now generally means a smaller balance later.
Government contributions have been cut in half
Since 1 July 2025, the government contribution to KiwiSaver has been reduced. The matching rate dropped from 50 cents to 25 cents for every dollar you contribute, and the maximum you can receive each year fell from $521.43 to $260.72. To get the full match you now need to contribute at least $1,042.86 over the year, about $20.06 a week.
A new income cap also applies. If you earn more than $180,000 a year, you no longer qualify for any government contribution at all.
16 and 17 year olds are now included
Two changes affect younger members. Since 1 July 2025, 16 and 17 year olds have been eligible for the government contribution, where previously the threshold was age 18. Since 1 April 2026, employers have also had to make compulsory contributions for employees aged 16 and 17. Starting contributions two years earlier gives younger members more time for compounding to work in their favour.
What has not changed
Several parts of KiwiSaver are unchanged by this round of reforms:
- Withdrawal rules for a first home or retirement are the same as before
- You can still choose a higher voluntary contribution rate of 4%, 6%, 8%, or 10%
- Savings suspensions (contribution holidays) are still available
- You can still switch providers at any time
- You keep full control over which fund your money is invested in
What you can do now
These changes are a good prompt to check in on your KiwiSaver generally, not because any single response suits everyone. Worth checking: whether your current contribution rate still matches your goals and budget, whether your fund choice suits the amount now going in and your timeframe, and whether a temporary rate reduction is genuinely the right call for your situation or a short term fix that could cost more later.