New Zealand Taxation
One of the most competitive tax systems in the world.
The New Zealand tax system
In this matter, simplicity is key. Our tax system is predictable, fair, and competitive for both earnings and assets, making New Zealand an obvious choice of country to live and invest in.
No taxes on…
What you will NOT be taxed on includes:
- inheritance tax
- general capital gains tax, although it can apply to some specific investments.
- local or state taxes apart from property rates levied by local councils and authorities
- social security
- health care, apart from a very low levy for New Zealand’s ‘accident compensation injury insurance scheme
What will I pay tax on, then?
The most common tax is our Goods and Services Tax (GST), applied to consumer goods. At 15%, it is used to fund services for New Zealanders. It does not applied to residential rents and financial services. Businesses may also recover the GST they pay.
For personal income tax, the top rate is 33% for income over NZ$70,000. At the other end of the scale, the tax rate is 10.5% on income up to $14,000.
For companies and corporates, there is flat tax rate of 28%.
Will I pay double tax if I move to New Zealand?
Income from overseas investments or pensions can be exempt from New Zealand tax for your first 4 years living here, providing you are eligible for ‘transitional tax resident’ status. This is a big incentive to make the move!
See the IRD website about tax exemption
If you are taxed by your home country after moving to new Zealand, you may be eligible for credits for tax paid overseas on the part of your income that is also subject to taxation in New Zealand. There are also international agreements for business to avoid double taxation.
See the IRD website about Double Tax Agreements (DTAs)
|Personal income||33% from $70,000|
30%: $48,001 to $70,000
17.5%: $14,001 to $48,000
10.5%: $0 to $14,000
|Tax credits||Working for Families credits for low and middle income earners.|
|Capital gains||Capital gains: generally not on New Zealand investments but applies to foreign debt and equity investments.|
|Dividends||Imputation system to avoid double tax.|
|Gift duty||Not since 2011.|
|Tax on savings||Little tax relief on contributions to New Zealand retirement schemes, but saving is not compulsory. Tax paid at normal income levels at source but distributions are tax free. No mortgage interest tax benefits except for investment property.|
|Fringe benefit tax||Paid by employer, up to a rate of 49.25% for employer provided cars, low interest loans, medical insurance premiums, foreign superannuation contributions etc. FBT is tax deductible so employer cost is effectively the same as paying cash remuneration.|
|Sales & excise tax||Goods and services tax (GST) of 15% on most things.|
Excise tax paid on petrol, tobacco, alcohol.