KPMG's summary/guide to New Zealand tax residence, PIEs, foreign currency accounts, tax returns, provisional tax, offshore share investments.
If you are a New Zealand tax resident, you will generally be subject to tax in New Zealand on your worldwide income. Non-residents are subject to tax in New Zealand on income only if it has a New Zealand source.
Many people are not aware of the specific requirements for triggering or losing their New Zealand tax residence status.
Download your copy of New Zealand Tax Residence.
Many New Zealand managed funds are now registered with the Inland Revenue Department as PIEs or Portfolio Investment Entities. Usually the tax paid by PIEs is the final tax, and you do not need to include anything in a tax return for these investments. However there are a few things that you need to be aware of, and to communicate to your fund manager.
Download your copy of Investing in PIEs
Bank accounts or loans in a foreign currency are subject to the financial arrangement rules. This means any foreign exchange gains are, or will become, taxable. Many people do not realise they have an obligation to report these gains to Inland Revenue.
Download your copy of Foreign Currency Bank Accounts.
When you go overseas on assignment or hold offshore investments, you will be required to file a return with Inland Revenue. To do this, there’s certain financial information you’ll need to keep.
Download your copy of Keeping Information for Tax Returns.
A provisional taxpayer is required to pay instalments of income tax (called provisional tax) during the income year, rather than at the end of the year when a tax return is filed. This obligation to pay provisional tax can arise in addition to the taxpayer’s employer deducting tax from salary payments.
If you are a provisional taxpayer, it is important that you make adequate provisional tax instalments during the year in order to minimise penalties and interest that may be imposed. However it can be difficult to know how much provisional tax to pay.
Download your copy of Provisional Tax for Individuals
New Zealand residents with investments in overseas shares need to consider their tax position each year. The timing of transactions, particularly around 31 March each year, can also have a significant impact on your tax position.
Download your copy of Offshore Share Investments
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The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavour to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation.