Can I reduce my ACC bill?

Yes — switching from ACC's standard cover (CoverPlus) to CoverPlus Extra (CPX) is the most common way for self-employed people to reduce or better manage their ACC costs.

Understanding your standard ACC cover (CoverPlus)

By default, all self-employed people in New Zealand are automatically on ACC CoverPlus. Under this scheme:

• ACC covers you for lost income if you're injured and can't work
• Your levy is based on your actual liable income (your profit) as reported to IRD
• If you're injured, ACC pays you 80% of your previous year's earnings
• You have no say in the amount of cover — it's calculated from your income

The problem for many sole traders is that CoverPlus uses last year's income as the basis, which may not reflect your current situation — and the levy cost can feel high relative to what you'd actually need if you were unable to work.

What is CoverPlus Extra (CPX)?

CoverPlus Extra is optional cover that lets you choose how much income you want ACC to cover. Instead of ACC basing your levy (and your payout) on your actual profit, you agree on a fixed level of cover upfront.

Key features:

• You set your own agreed level of cover — from a minimum amount up to the ACC maximum
• Your levy is then calculated based on that agreed amount, not your actual profit
• If you're injured and can't work, ACC pays 100% of your agreed cover (minus tax), as weekly payments
• If you return to work at 50% capacity, compensation reduces to 50%
• Compensation stops when you're working at least 30 hours per week

How CoverPlus Extra can reduce your bill

If your agreed level of cover is lower than your actual income, your levy will be lower than under standard CoverPlus. This is particularly useful if:

• Your income varies year to year and last year's earnings were high
• You have other income, savings, or insurance that would cover you if injured
• You're working part-time and don't need full income replacement

Example:

Your actual profit last year was $90,000. Under CoverPlus, your levy is based on $90,000. Under CoverPlus Extra, you agree to cover of $50,000 — your levy is based on $50,000 instead, reducing your cost.

⚠️ If you're injured, your compensation is limited to your agreed amount — so don't set it lower than you could realistically manage on.

Who is eligible for CoverPlus Extra?

To qualify you must be:

• Self-employed (including sole traders) or a non-PAYE shareholder-employee
• Working full-time (more than 30 hours per week on average), or
• Working part-time (30 hours or less per week) with earnings above the current CPX minimum

How to apply

You can apply for CoverPlus Extra:

• Online through MyACC for Business
• By contacting ACC directly at acc.co.nz

Use the ACC CoverPlus Extra Calculator to estimate your levy under different cover levels before applying.

CoverPlus vs CoverPlus Extra — quick comparison

Source: acc.co.nz — CoverPlus Extra (CPX) | acc.co.nz — Cover for self-employed | business.govt.nz — ACC levies