NEW ZEALAND TAX RESIDENCE

You are a New Zealand tax resident if:

The 183 days need not be consecutive.   If you are in New Zealand for only part of a day, this is counted as being a full day.   This means that the days on which you depart are treated as days present in New Zealand. 

To decide whether you have an enduring relationship with New Zealand, Inland Revenue Department looks at your circumstances, and in particular:

DOUBLE TAX AGREEMENTS

You may be a tax resident in both New Zealand and another country.   This means that you are resident in two countries under the tax laws of each of these countries.   If both countries tax their residents on worldwide income you could be taxed twice on the same income.   Double tax agreements have been negotiated between New Zealand and many other countries to decide which country has the first or sole right to tax specific types of income.   These countries have double tax agreements with New Zealand: 

 If you are away from New Zealand for more than 325 Days in any 12 month period, you become a non resident if you do not have an enduring relationship with New Zealand.   The 325 days need not be consecutive.   If you are here for only part of a day it is counted as a whole day. 

If you are a New Zealand tax resident you are taxed on your worldwide income.   You must state your income from all sources. Including that from overseas, in an individual tax return (IR3).   You are normally allowed a tax credit for any tax paid overseas so you will need to be able to produce records which show the overseas tax you paid.   The New Zealand tax year is 1 April to 31 March, so you may need to apportion your overseas income to fit the New Zealand tax year. 

If you will no longer be a tax resident and will not be receiving income from New Zealand from the date you leave, you will need to complete an individual tax return up to the date of departure.   You can file your return before the end of the tax year.   Income you received from all sources to the date you leave New Zealand should be included in the return.   IRD will process the return quickly if they are aware that you are leaving New Zealand permanently.   You can state that you are leaving New Zealand permanently by filling in an IR 50 form and proof of departure and sending these with your return. 

PAYING TAX AS A NON RESIDENT

If you are a non resident you are taxed only on income you receive from a New Zealand source.   If your only income from New Zealand is interest, dividends, and the correct amount of non resident withholding tax (NRWT) is deducted, you will not need to file a non resident return.   The law is different for industrial royalties and interest paid to associated persons.   You will be required to file a non resident return if you receive such income. 

Let your bank know your overseas address and that you are non-resident.   This will make sure that the correct amount of NRWT is deducted. 

Any other income such as rental, business or farming income is subject to New Zealand tax at the normal rates.   You must include it in your non resident tax return. 

You should complete a non resident income tax return (IR 3NR) if you are non resident for the full year and you have continuing income from New Zealand. 

If you have been a non resident then return to New Zealand and become a tax resident again, you may need to request a personal tax summary or file an individual return covering the period from 1 April before your arrival to the end of the tax year, the following 31 March.   Contact IRD to clarify this.   If you are required to complete a tax return, include your New Zealand income earned while overseas and your worldwide income received after the date of your arrival for the income year.   Show clearly the breakdown of income you received before and after you arrived. 

RESIDENCE RULES FOR COMPANIES

A company is resident in New Zealand if it meets any one of the following criteria:

NOMINATING A REPRESENTATIVE

You are able to give someone else (such as a parent or friend) authority to act on your behalf while you are overseas. To do so you must advise IRD. 

Your representative can make enquiries on your behalf and all IRD correspondence can be sent to this person. 

You will still be responsible for your own tax affairs, so you’ll need to make sure that any returns are filed and tax is paid by the due date.

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