Legalities and tax in New Zealand

The New Zealand Government is committed to attracting investors into the country, so many rules and tax laws have been simplified in recent years. This means more opportunity for your success. 

Regulations

An ‘open market economy' 

Investment from overseas is supported by regulatory limitations that are often no more than the normal legislative business framework for local business.

There are incentives in some industries (such as the Film Industry, and Research and Development), and we have a well-developed financial markets sector to assist your business growth.

Note that the Overseas Investment Office administers the government’s foreign investment policies. For more information, refer to the Overseas Investment Office website.

Entrepreneurial culture 

Kiwis generally like to get stuck in and try things differently. This filters down to business level, which can be seen in the global success of many innovative start-ups.

There’s flexibility in labour and licencing laws, and no minimum capital required to actually register a company. 

Aspects like this make things easier for new businesses with limited capital and big ideas.

 

Tax

Tax is a complex area in many countries. But New Zealand is known to have a system that’s relatively easy to navigate. 

Advantages for new investors 

Unlike many other countries, New Zealand has no inheritance, payroll, social security taxes. Aside from some local rates paid to local authorities, there are no state taxes either. 

Four year concession: 

A tax concession on foreign investment income and pensions is available for your first four years of living here. Only your New Zealand sourced income is liable to income tax for that period.

Note that after the four year exemption period, tax will then apply to realised and unrealised gains on overseas portfolios (including exchange gains). To be eligible for the 4 year exemption, a migrant cannot have already been a tax resident of New Zealand.

Double Taxation: 

If you are concerned about paying tax here as well as in another country, New Zealand may provide credits for income tax paid overseas (that is also subject to New Zealand tax). 

New Zealand also has double tax agreements with many of our main trading and investment partners which reduces some forms of double taxation.

Inland Revenue Department (‘IRD’) 

The IRD is a Governmental Department set up to collect tax revenue (and they also administer a number of social support programmes). 

The best place to start with any tax query is on their comprehensive website:

http://www.ird.govt.nz

Tax advice 

No matter where you are in the world, tax can sometimes be a mine field. We recommend getting professional advice from tax specialists.