Headline salary is the easy number. Borrowing power is built on income a lender believes will still be there when rates are higher and the bonus season is quieter. Overtime, allowances, commission and bonuses can lift a payslip without lifting the assessment by the same amount. If you plan a purchase on the full package, you are planning on a figure many credit policies will not use.
Base salary is the floor they trust
Permanent base pay, evidenced by a letter and payslips, is what almost every New Zealand lender starts with. KiwiSaver at the default employee rate of 3.5% and PAYE at the 2026-27brackets decide how much of that base arrives as cash, which is what serviceability tests. A calculator that lets you type gross income is only as honest as the gross you choose. Typing base plus last year's bonus as if it were salary is the usual way the range gets ahead of the bank.
Overtime and allowances need a history
If overtime is structural — healthcare, emergency services, rostered industry — lenders often average a year or more of payslips and count some or all of it. If it is a temporary project or a quiet-roster spike, they may ignore it. Allowances that are contractual and regular (shift, on-call) fare better than reimbursements and one-off payments. The test is repeatability: would this still be here if you were ill for a month, or if the extra shift disappeared?
Bonuses are averaged and often halved
A common pattern is to take two years of bonuses, average them, then apply a discount — 50% is widely used — unless the bonus is guaranteed in the employment agreement, which most are not. A single bumper year after a zero year averages down hard. A sign-on or retention payment is usually treated as non-recurring. Commission roles follow the same logic with more volatility haircut. None of this is in the published DTI formula; it is credit policy on top of the Reserve Bank limits.
A practical way to use the calculator
Run the borrowing range twice. First with base salary only. Second with a conservative add-on — for example half of the lower of the last two bonuses, plus overtime you would still expect on a normal roster. If the price you want only works on the second run, you are in policy-sensitive territory: one lender may accept the add-on, another may not, and a rate rise will hit you on the full loan either way. Keep the first run as your private ceiling when you shop listings.
DTI still sees the debts, not the bonus story
Debt-to-income caps apply to the income the bank puts in the file, not the income on your LinkedIn profile. Credit-card limits, student loans and hire purchase reduce the room under that cap regardless of how strong last year's bonus was. If variable pay is a large share of the household, reducing card limits and other consumer debt often does more for borrowing power than arguing about bonus treatment. The range tool lets you test both levers; a broker can tell you how a specific bank writes the bonus rule.