New Zealand tax guide
New Zealand tax rates
As of 1 April, 2009, the New Zealand tax rates (excluding ACC earner’s levy) are:
- 12.5 cents of every dollar for income up to $14,000
- 21 cents of every dollar for income from $14,001 and $48,000
- 33 cents of every dollar for income from $48,001 to $70,000
38 cents of every dollar for income of $70,001 and over
The New Zealand tax year
The standard New Zealand tax year runs from 1 April to 31 March.
Non-residents & visitors
Depending on your tax residency status, different taxes may apply. As a tourist you will pay GST on your purchases. If you earn wages or a salary, income tax will apply. Withholding tax may apply to contractors, sports people, entertainers and performing artists visiting New Zealand.
Are you a New Zealand resident for tax purposes?
You will need to establish if you are a New Zealand resident or non-resident for tax purposes. You'll be a:
- New Zealand resident if you're overseas for less than 325 days in a 12-month period, or
- a non-resident if you're overseas for more than 325 days in a 12-month period, and you don't have an enduring relationship with New Zealand.
The Inland Revenue Department’s New Zealand tax residence guide (IR292) explains the residency rules in full detail.
Your IRD number
You will need an IRD number before you start a job, or if you want to open a bank account. You must apply for an IRD number before you can receive income from work.
Foreign income tax rule
Since 1 April 2006, people arriving to live in New Zealand may qualify for a temporary tax exemption on most types of foreign income.
KiwiSaver – New Zealand's work-based savings initiative
Since 1 July 2007, most New Zealand residents and people entitled to be in New Zealand indefinitely (who are aged 18 years or older) are automatically enrolled in KiwiSaver when they start a new job.
KiwiSaver is a voluntary retirement savings scheme – you can opt out any time from two to eight weeks after beginning employment. The minimum contribution for a worker enrolled in KiwiSaver is 2% of the worker’s gross pay, though most people contribute 4% of their gross pay.
Are you entitled to tax credits?
Working for Families tax credits, formerly called family assistance, is financial help for families who have financially dependent children aged 18 years or under. The amount of Working for Families tax credits you may receive depends upon:
- how many children aged 18 years or younger you have in your care
- how much you and your partner earn
- from where you receive your income (i.e. employment or a benefit)
The four kinds of Working for Families tax credits are:
- Family Tax Credit, paid to low and middle-income families for each child who is aged 18 years or younger
- In-work Tax Credit, a payment for families who work a minimum number of hours each week
- Minimum Family Tax Credit, to bring a family's income up to at $355 per week after tax. To receive this assistance, at least one parent in the family must be working for salary or wages
- Parental Tax Credit, for the first 56 days of a baby's life.
Independent earner tax credits are available to New Zealand tax residents earning between $24,000 and $48,000 per tax year. You are ineligible if you already receive Working for Families tax credits, an income tested benefit, NZ Super, a veteran’s pension or any foreign equivalent of these.
Source: Inland Revenue Department
