Accident Compensation (ACC) – No Lawsuits Allowed
In New Zealand you cannot sue someone for causing you injury.
- If you’re injured in New Zealand, regardless of cause or blame, the ACC scheme entitles you to:
Free medical care. - Payment of a proportion of your salary – up to 80 percent – while you recover.
- Payment of lump-sum compensation, if appropriate.
The ACC scheme replaces the right to sue for damages.
The ACC scheme is funded by a small tax paid by employees, employers and self-employed people on earnings.
If you are an employee, you pay a levy of 1.39 percent on your earnings to fund ACC. The employee or ‘earners’ levy is charged at a flat rate, which can change each year.
There is a maximum amount of salary that earners’ levy is charged on. Any amount of salary or wages earned over this maximum isn’t liable for earners’ levy.
Rate of Earners Levy
| Tax year | Rate (%) | Maximum Levy ($) |
|---|---|---|
| 01/04/2020 to 31/03/2021 | 1.39 | 1,819.66 |
| 01/04/2019 to 31/03/2020 | 1.39 | 1,785.73 |
| 01/04/2018 to 31/03/2019 | 1.39 | 1,755.37 |
| 01/04/2017 to 31/03/2018 | 1.39 | 1,724.33 |
| 01/04/2016 to 31/03/2017 | 1.39 | 1,696.67 |
| 01/04/2015 to 31/03/2016 | 1.45 | 1,741.01 |
| 01/04/2014 to 31/03/2015 | 1.45 | 1,713.76 |
| 01/04/2013 to 31/03/2014 | 1.7 | 1,973.51 |
| 01/04/2012 to 31/03/2013 | 1.7 | 1,934.05 |
| 01/04/2011 to 31/03/2012 | 2.04 | 2,278.04 |
| 01/10/2010 to 31/03/2011 | 2.04 | 2,244.36 |
| 01/04/2010 to 30/09/2010 | 2.04 | 2,200.36 |
| 01/04/2009 to 31/03/2010 | 2.00 | 1,810.04 |
| 01/04/2008 to 31/03/2009 | 1.7 | 1,440.91 |
| 01/04/2007 to 31/03/2008 | 1.4 | 1,297.61 |
The ACC Motor Vehicle Account covers claims for all injuries involving motor vehicles on public roads in New Zealand. It is funded by a levy included in the price of petrol and the motor vehicle licensing fee.
Self-employed individuals also pay an ACC levy for annual personal injury cover. The amount payable depends on the type of business and the amount of taxable profits earned. If you work in a high accident industry you can expect to pay substantially more in ACC premiums compared to low risk occupations. Self-employed ACC premiums typically range from $1,000 to $3,000 per annum.
ACC does not cover illness, stress, hurt feelings or injuries related mainly to ageing. For example, if you break a tooth while playing sport you are covered by ACC for dental treatment. However, if you were eating a toffee and you broke your tooth while chewing it, then you are unlikely to be covered by ACC.
ACC also provides automatic cover to visitors who are injured whilst staying in New Zealand.