Long story short, I'm working as an independent contractor in New Zealand (no leave, no super).
Thinking of moving back to Aussie and I'm trying to workout a salary in Australia that would be equivalent to my current income.
Does anyone have a formula or know of one that I can use? Things that might factor in 11% super, leave, exchange rate, tax etc… in Aussie as currently I am on no leave and no kiwisaver. Tried googling it but it doesn't really help :-/
Thanks in advanced.
I figure everything in Aussie is cheaper than here (Auckland) anyway so an equivalent income would do me just fine.
I obviously don't know how much things cost in NZ but it's pretty expensive here. When I lived there for a year in 2006 the wages were pretty low, I was on $10 per hour for labouring and then I found a job that got me all the way up to $14.
Let's just say petrol is NZD$2.5 a litre and egg is about NZD$10 for a dozen at the moment.
@Craze: regular. The free range go up to $11.5 for a dozen.
https://www.newworld.co.nz/shop/product/5281154_ea_000nw?nam…
I have been spending one week on (in Auckland) and one week off (in Sydney) for almost the last year and the cost of living (housing, food, transport, recreation) is slightly higher (<5%) in Sydney. There may be some things that are cheaper, like your petrol and eggs examples, but overall, Sydney is slightly more expensive, from my sample size of one. This is also backed up by various indices that are updated annually;
https://www.weforum.org/agenda/2022/12/world-most-expensive-…
https://www.mercer.com/insights/total-rewards/talent-mobilit…
What kind of formula are you talking about? Some of the "things" you've mentioned are very different from each other. At best, you can probably make an Excel sheet outlining your current and future salary in AUD, as well as factors you might want to take into account. Cost of living, etc. As a start, it might be helpful to let us know what sorts of salary you're looking for or are currently on. Then based on our uneducated guess, we might give you a rough estimate
Currently on NZD 178k contracting (No leave, no super).
So say if I move to Aussie and get a 110k job, add super, add leave, add or subtract tax differences, factor in the exchange rate (anything else I miss?). Would it be an equivalent ? Chur
I just did a quick calc (very high level), and noted the following to get to an equivalent net return of a $178k gross income:
| Info | NZ | AUS | |
|---|---|---|---|
| Income | $ 178,000.00 | $ 136,000.00 | |
| Add: Superannuation | 11.00% Applied to Income | $ 14,280.00 | |
| Add: 4 Weeks Annual Leave | 4 Weeks / 52 Applied to Income | $ 10,461.54 | |
| Add: 0.8 Weeks Long Service Leave Accrued | 0.8 Weeks / 52 Applied to Income | $ 2,092.31 | |
| AUD Equivalent Gross Income (based on 0.92 NZD to AUD) | $ 163,760.00 | $ 162,833.85 | |
| Taxation on Income | $ 49,660.00 | $ 48,758.00 | |
| Net Income | $ 114,100.00 | $ 114,075.85 |
Noting though that this is very high level and LSL Accrual is only if you stay for >10 years at the employer. So probably looking at equivalent salary of approx $138-$140k Full Time AUD.
Also excludes differences in Cost of Living as mentioned below, very dependent on circumstances.
Gee man. I know ozbargainer is helpful but you might be the star. Thanks! I'll pop these into a spreadsheet and keep adding to it!
@tomleonhart: Happy to help :) Although I just realised there was an error in the calculation of income tax, should be applied on the base salary. So overall, it should actually be approx $127,500 AUD gross income similar to the table above (resulting in $34.5k tax vs $44k (had to update to AUD equivalent also) above).
Screenshot of calc to not clog the comments with big tables.
Noting also that 15% tax on superannuation is applied also when going into your super fund.
One thing I didn't realise also is that you seem to be able to just transfer between Aus and Kiwi super funds without any issue if you go home permanently again.
@doweyy: The 4 weeks annual leave is only that additional value if you don't take any time off and get paid out on leaving the company isn't it?
If you work 48 weeks and take 4 weeks leave it's the same pay as if you worked 52 weeks surely? (just with the addition of leave loading).
The same would apply to LSL too wouldn't it?
I see it as basically being paid at the same rate but not having to attend work - ie same amount per annum but less hours worked.
@Grunntt: That’s correct, but it’s still an additional monetary benefit on top of your normal salary. As a contractor you’re entitled to no leave, whereas as a Full time employee you get a 4 week accrual, regardless of how much you take. So if you take zero leave for a year, that’s where the example would work.
Forgot about leave loading in the example too, thanks for noting that.
But in normal circumstances people would take to take leave generally during the year, so yeah overall not as a bit of a benefit as noted for a normal employee but still a benefit.
It’s more of a benefit for “free time” if you take leave, compared to an additional cash benefit I guess. Only really comes to fruition as an additional benefit if you get paid out.
It’s more of a benefit for “free time” if you take leave, compared to an additional cash benefit I guess. Only really comes to fruition as an additional benefit if you get paid out.
So, for the purpose of calculation of comparable annual income, should your calculation only use the dollar value of the leave loading as income rather than the total as it is the same amount per annum if taken?
I don't think it is accurate or practical to annualise the amount of leave not taken (that is left at the end of any employment) and use that for the purpose of your calculation.
It results in extra income per annum of ~$1830 (using a typical rate of 17.5%) rather than the $10461 in your calculation. Which, in turn makes a significant difference to the rest of the calculation of annual income for comparison uses.
Good start but you forgot to include personal/sick leave and public holidays as well.
Your calculation is wrong as contracting income allows for annual leave as well as other leaves inbuilt into the income.
Normal contractor in Australia work up to 221 days per annum based on below calculation obviously they can go up to 261 if not taking any leave in between
365 - (20 annual leave) - (10 sick leave) - (10 public holiday) - (104 weekend days) = 221.
so basically 178k for contract role includes all leaves and same for 136k for permanent employee who will get paid leave but doesn't mean permanent employee get paid more $$$ if he/she doesn't take leave so it is misguided calculation to say that person should put $$ value against the leave days when comparing permanent vs contract employment. One may argue that if permanent employee doesn't take annual leave (public holiday in most instance compulsory unless front line where shift work requires on holiday) then they can cash out 20 annual leave so it has some value in that regards but remember maximum cash out is limited to 20 annual leave one may put $$ value against annual leave. sick leave on other hand can't be cash out same as weekend days.
On the hand for the business they have to allow for $$ value against each leave they are providing (as long as they are running business on those days) as they have to arrange alternative employee for those days …. ! so same calculation works differently for employer… !!
The key reason contractor paid high is for the RISK they take by engaging in to contractual arrangement where their employment can be terminated without cause and with as small as 1 day notice period … nothing else…. !!!!! that is why some people use 1.25 time permanent wages as thumb rule for contractual employment as additional 25% probably cover payment for leave.
Nowadays labor also following liberal trend in Australia by converting many permanent employment opportunity in government from permanent employment to fixed term contract which fall between real contract and permanent employment and it was created to manipulate fair work nothing else in my opinion by the government themselves…. in my opinion…. lol 😂 😂
Was recently in NZ. Eating out is cheaper in NZ.
I liked that lots of things in New Zealand embrace Indigenous culture and the Maori language is widely used everywhere. Australia is decades behind in this regard.
House prices in Auckland are cheaper than Sydney and stamp duty is not a factor there.
Everything else is similar.
Is there a dominant aboriginal language in Australia like Maori in NZ? I always thought that here in Australia there are heaps and heaps of different languages without a clear dominant.
You are 100% right there is no dominate aboriginal language, and I don’t think there ever will be as there has been countless arguments between the different groups as to which one is used so it’s highly likely we will never adopt this.
Māori language is just the single language taught.
There is nothing stopping local areas embracing it more. For example in Sydney: councils, Sydney Trains & businesses could use the local one. Even NZ has regional differences, but that hasnt stopped them.
where did you eat lol ? A pasta is upward of $30 and bowl of Vietnamese Pho is $21 at the moment.
Yes, I remember having Thai in Auckland decades ago where dishes were $20 each when in Australia it was half that.
Same. 2014, $18.5 NZD in Auckland for Pad Thai at lunch time while I could get the same thing for $8.5 in Mascot, NSW.
Australia is decades behind in this regard.
More than decades, because NZ has essentially always had that because the Māori fought so hard and united from the get-go.
Also while there's only about 3 Māori dialects, there is about 800 aboriginal ones, so having a universal second language here is not feasible.
New Zealand is a much smaller country than Australia that why the Maori language is widely used. In Australia there are more than 250 Indigenous languages including 800 dialects how can you compare?
So NZ doesn’t have compulsory super? I'm astonished.
They have kiwisaver, it's a voluntary thing. If you choose to opt in, you can pay anywhere from 3-10% from your before tax pay, and then your employer will pay 3% also.
If you don't opt in, your employer doesn't have to pay anything.
How barbaric! I can see why so many head this way. It's quite a poor indictment on NZ society.
they have some pros.. they pay no CGT on sales of shares, and they don't pay stamp duty on housing.
@bohn: Interesting. I naively assumed the differences between our two countries were similar to those between our states. Except for their anthem which shits over our funereal dirge.
Is this a joke? How could you possibly think oz superannuation is a good thing?
I'd setup a SMSF but the rules around what you can't invest in (certainly not your PPOR), auditing and costs involved make it a basically pointless exercise.
Want to pay off your house quicker? No, (profanity) you, pay some middle-men pricks admin fees so he can stick it in an index and make you eat losses in a recession. Great.
@ssfps: I remember reading about SMSF about 10 years ago. Don't you need like 200k saved up before any meaningful gain can be made by managing yourself ?
@tomleonhart: That sounds about right. Even then, it's a lot of work for the benefit when all the investments need to be beyond arms reach.
That would be a lot of kiwis saved
Have a look at a few of the expat 'cost of living' sites eg https://livingcost.org/cost/australia/new-zealand (there are a few others so look around, but make sure they are using recent data and not, for example, 2019 data which is now significantly out of date)
Most show that the cost of living in Australia is higher than in NZ, although obviously it depends on what you spend your money on.
Do anyone other than kiwis refer to Australia as Aussie? I mean the country rather than the people.
Yep, can tell he wasn't raised in Australia
It's one way to spot..
my international student friend does that
And I haven't bother
Bothered*
I've never heard Australia referred to as "Aussie"
ye me either.. you'd reckon they'd say 'Thinking of moving back to Aus'
My step dad refers to Australia as Aussie which I find cringeworthy and hugely embarrassing. And he's 7 generations. They exist.
*STRAAYYA
I was thinking the same question..
Aussie = australian
uber driver?
Interested to know your current position to see if your projected equivalent rate is actually achievable or not. Might also depend on the state.
It also depends on where you are, and where you plan to move to. Just like there is a huge difference in IT salaries and rental costs between Tāmaki Makaurau and Kirikiriroa (Auckland and Hamilton), the same is true between Sydney and Brisbane for example.
LMAO NZ
just did. doesn't look very right to me :-/
on what basis ? the calculator tells you what equivalent salary you need considering cost of living, taxes etc in another country. obviously no one knows how accurate this calculators are .. !
now there is another one of similar type which mostly use by companies when they transfer employee from say UK to US or UK to Australia but can't find the link at the moment.
there are many calculator like that and hard to work out which one is perfect … ! but always use calculator that uses cost of living as a factor because value of 150k in New Zealand is worth less in California for similar life style .. !
https://app.figures.hr/global-salary-converter/paris/berlin/…
Hi I moved from Auckland to Brisbane last year so have been actively comparing the 2 places. Apart from what others mentioned here are something you might be interested…
These are strictly personal feelings. If you don't agree then don't agree.
pro NZ
- medical expense seems to be cheaper. Prescriptions are almost always free. Although I don't see doctor a lot.
- ACC covers all medical cost due to accidents
- House are generally newer and in better conditions
- Environment is better, less dusty. Council done a great job with all these beautiful parks and well maintained grass
- Cars are cheaper, although lots of lemons came from, you know, Australia, among other places
- No stamp duty
pro AU
- Cheaper groceries
- Cheaper Gas
- Great Credit Card Deals
- Gift Card deals
- 10% GST (comparing to 15%) refundable under certain circumstances. That means if you time it nicely you can get 9% off phones and laptops etc.
- Cheaper flights to most of the oversea destinations
- House are generally cheaper, but conditions varies a lot
- Not as high interest rate
- OzBargain
Income Tax rate are more or less similar, unless you are in the top 45% bucket of AU in which case you probably don't need to worry about the other stuff.
Also have to factor in cost of living, rent, food, bills etc. I don't think there's a formula that will calculate everything for you.