Living in New Zealand can be so exciting that, one thing is for sure – the last thing at forefront of your mind is tax. Here’s a handy guide with everything you need to know:
Quick tax facts to keep in mind:
1. One of the biggest factors affecting what you’ll pay is your residency status.
You’ll be considered a non-resident for tax purposes if you stay for 183 days or less in any 12-month period. Non-residents are only taxed on their New Zealand sourced income.
However if you remain in the country more than 183 days you’ll become a tax resident from the date you arrived and be taxed on your worldwide income.
2. If you want to work in New Zealand, you should apply for an IRD number so your employer will tax you correctly. Without one, your income will be taxed at the highest rate.
3. New Zealand has a number of tax treaties in place to help residents of certain countries avoid double taxation, so you should find out if any apply to you when filing your tax return.
4. To claim your tax back you’ll need:
- Summary of earnings or final payslip
- A copy of your ID
- IRD number
5. The New Zealand tax year runs from April 1st to March 31st of the following year.
For example, if you worked any time between 1-April-2017 and 31-March-2018, you can apply for a tax return for the time worked between those dates after 31-March-2018.
The due date for income tax returns is on or before July 7th.
6. There is no payroll tax in New Zealand.
There is also no social security tax, no inheritance tax and no state/local tax.
There is no capital gains tax (only on certain particular forms of investments) and no healthcare tax (only a very low levy for the New Zealand accident compensation scheme).
7. You can do your tax refund yourself through the MyIR website.
Backpacker Guide NZ have a really handy manual for do-it-yourself tax refunds and plenty of information about how to submit a printed copy if you are leaving the country.
8. Or you can use the help of a tax agent like Taxback.com
Tax agents will ensure that your return is filed correctly. You would need to submit one of their New Zealand application forms, after which someone from their team will come back to you with a free estimation of your refund. If you’re happy with their proposal, they will prepare your tax return and submit it to the IRD. You will receive your tax refund straight to your bank account and in the currency of your choice.
If you have further questions about your IRD number, tax return, IR3 form or anything at all tax-related then you should contact IRD directly:
- +64 3 951 2020 from overseas
- 0800 227 774 in New Zealand