Company tax rate: 28% flat rate
Salary, wages, or other income (excluding dividends)
Cash Dividend
$144,000.00
Imputation Credit
$56,000.00
Personal Tax
$12,919.50
Effective Rate
34.5%
Net to Shareholder
$131,080.50
Profit Breakdown
Everything you need to know about dividend imputation in New Zealand
What are Imputation Credits?
Imputation credits represent company tax already paid on profits distributed as dividends. New Zealand's dividend imputation system prevents double taxation by allowing shareholders to offset their personal tax with imputation credits attached to dividends. The company tax rate is 28%.
How Imputation Credits Work
When you receive a dividend with imputation credits, you include the grossed-up amount (dividend + imputation credit) in your tax return. You pay tax on the grossed-up amount at your marginal rate, then receive a tax credit equal to the imputation credit. If the credit exceeds your tax, you may receive a refund.
Imputation Credit Account (ICA)
Companies maintain an Imputation Credit Account (ICA) to track tax credits available for attaching to dividends. The ICA is credited when the company pays income tax and debited when imputation credits are attached to dividends paid to shareholders.
Low Income Earners
If your marginal tax rate is below the company tax rate of 28%, the imputation credits will exceed your tax on the dividend, resulting in a tax refund. This is particularly beneficial for retirees and low-income shareholders.
IRD-Aligned: This calculator uses official IRD tax rates and imputation credit rules for the 2025-26 income year. Consider consulting a tax professional for complex dividend structures.
Disclaimer: This calculator provides estimates based on current HMRC rates and thresholds for the 2025/26 tax year. It does not constitute professional tax, financial, or legal advice. Your actual liability may differ depending on your individual circumstances. Always consult a qualified accountant or tax adviser before making financial decisions. Read our terms