Everything you need to know about moving to NZ

New Zealand operates a comprehensive taxation regime under which New Zealand Tax Residents are subject to income tax on their worldwide income - in the simplest terms, any money you earn is taxed. New Zealand has a Double Tax Agreement with the UK, so you will not be taxed twice on any UK income. 

New Zealand Income Tax

New Zealand operates a self-assessment system where taxpayers are responsible for completing and filing their own tax returns if required. Employees have income tax deducted from their earnings as they are paid by their employers. The tax is paid to the Government under a system known as "pay as you earn" (PAYE).

Taxpayers who derive their income from sources such as businesses, rental or investments pay tax in three instalments during the year with a fourth annual square-up payment. This is referred to as the provisional tax regime.  

If you are earning a wage in NZ, you'll find that approximately the same amount of your income disappears automatically to the tax man as in the UK. The main difference is that there is no personal allowance; but on the up-side, there are no stamp duties, estate duties, or National Insurance contributions.

New Zealand Capital Gains Tax

There is also no comprehensive New Zealand Capital Gains Tax regime. However, in certain situations income tax (based on the tax rates of the person or company in question) can apply to certain types of capital gains generated - the most common example of this to affect individuals in New Zealand (rather than companies) is the capital gains tax on residential property investment. There is also a tax payable on some offshore investments which has a capital gains element. This is capped at 5% of the value of the investment. 

As in the UK, the New Zealand tax year runs from April 1st to March 31st.

The income levels at which income tax is assessed are:

Individuals (from 1st October 2008):

• up to NZ$14,000, the rate is 12.5%
• betweeen NZ$14,001 and NZ$40,000, the rate is 21%
• between NZ$40,001 and NZ$70,000 the rate is 33%
• over NZ$70,000 the rate is 39%

Companies:

• all income is subject to the flat rate of 30%

Complying Trusts:

• income retained by the Trust is subject to the flat rate of 30%
• income distributed to beneficiaries (with 6 months of balance date) is taxed at the rates for the individual beneficiaries (as listed above)