New Zealand's justice minister resigned on Monday after being arrested in relation to a car crash the previous day, the fourth minister to quit the cabinet in as many months in an election year.

Kiri Allan has resigned from all her portfolios immediately, Prime Minister Chris Hipkins said, after she was taken into police custody over the accident in the national capital of Wellington on Sunday.

Allan was charged with careless use of a motor vehicle and refusing to accompany a police officer, and issued with an infringement notice for returning an excess breath alcohol reading, Hipkins told a press conference.

"She understood that retaining her ministerial warrant was untenable, especially for a justice minister to be charged with criminal offending," Hipkins said.

"While her actions are inexcusable, I was given information that she was experiencing extreme emotional distress at the time of the incident."

Allan is the fourth minister to resign since March from the centre-left Labour government and ahead of an election in October. Opinion polls suggest a close contest with the main opposition National Party.

Hipkins said Allan's "recent personal struggles with mental health have been well documented and it appears some of those issues came to a head yesterday."

Allan, who was also minister for regional development, minister of conservation, and minister for emergency management, returned to parliamentary duties last Monday after taking some days off due to mental health issues.

Once touted as a potential successor to previous prime minister Jacinda Ardern, Allan said she will take time to consider her future in politics.

"Over recent weeks, I've faced a number of personal difficulties. I took time off to address those, and believed I was okay to juggle those challenges with the pressure of being a Minister. My actions yesterday show I wasn't okay," Allan said in a statement.