New Zealand tax information for individuals and couples: Domestic and foreign bank interest, stocks and bonds, dividends, investment funds, ETFs, CIVs, and PIEs

10 Pages Posted: 18 Oct 2022 Last revised: 24 Jun 2024

See all articles by Timothy Falcon Crack

Timothy Falcon Crack

University of Otago - Department of Accountancy and Finance

Date Written: June 24, 2024

Abstract

These notes are suitable for retail investors and university-level students. They provide information (but not advice) on New Zealand taxes for individuals and couples on domestic and foreign bank interest, stocks and bonds, dividends, investment funds, and PIEs. Domestic taxes due on direct and indirect ownership, respectively, of domestic interest-bearing and domestic dividend-bearing investments, respectively, are discussed. Resident withholding taxes (RWT) and prescribed investor rates (PIR) are compared and contrasted. Direct ownership is compared with indirect ownership via funds which might be portfolio investment entities (PIE). Multi-rate PIEs (MRP) are discussed and compared and contrasted with listed PIEs (e.g., NZX Smartshares exchange traded funds [ETFs]). Domestic taxes due on direct and indirect ownership, respectively, of foreign interest-bearing and foreign dividend-bearing investments, respectively, are also discussed. The foreign investment funds (FIF) reporting regime is discussed along with the de minimis hurdle for individual or joint ownership. Collective investment vehicles (CIVs) are discussed. KiwiSaver taxes, KiwiSaver employer superannuation contribution tax (ESCT), KiwiSaver employee contributions, and KiwiSaver employer contributions are discussed. Taxes on domestic and foreign bank accounts, term deposits, term funds, stocks, bonds, Treasury bonds, and mutual funds are discussed. Foreign retirement savings schemes and foreign balance dates are also discussed.

Keywords: New Zealand Taxes, FIF Regime, Multi-Rate PIE, Listed Pie, de minimis hurdle, KiwiSaver, Resident Withholding Tax (RWT), Prescribed Investor Rate (PIR), Employer Superannuation Contribution Tax (ESCT), NZX Smartshares, Exchange Traded Funds (ETFs)

Suggested Citation

Crack, Timothy Falcon, New Zealand tax information for individuals and couples: Domestic and foreign bank interest, stocks and bonds, dividends, investment funds, ETFs, CIVs, and PIEs (June 24, 2024). Available at SSRN: https://ssrn.com/abstract=4218351 or http://dx.doi.org/10.2139/ssrn.4218351

Timothy Falcon Crack (Contact Author)

University of Otago - Department of Accountancy and Finance ( email )

Dunedin
New Zealand

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