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New Zeland

New Zealand, a country located in the South Pacific, comprises two major islands stretching north and south and separated by Cook Strait. Its capital city is Wellington. The two languages are English and Māori, and the currency is the New Zealand dollar (NZD).




CIT = Corporate Income Tax 

SSC = Social Security Contribution  (Employee + Employer)


New Zealand's real gross domestic product (GDP) decreased by 0.3% in the September 2023 quarter. Unemployment increased slightly at 3.9% in the September 2023 quarter, while the consumer price index (CPI) decreased to 5.6%. Annual inflation is therefore outside the Reserve Bank of New Zealand's target range of 1% to 3%.  

Image by Liam Shaw



Taxation of individuals

A resident of New Zealand is subject to tax on worldwide income. A non-resident is subject to tax only on income from sources in New Zealand.

Personal income tax rates

Individual tax rates are currently as follows:



Social Contribution  

KiwiSaver scheme

KiwiSaver is a voluntary workplace-based superannuation savings scheme. It was introduced from 1 July 2007. The KiwiSaver scheme is voluntary for all employees over the age of 18, both full and part-time. All New Zealand residents over the eligible age are able to join KiwiSaver, but membership is not compulsory.

The minimum rate for both member and employer contributions is 3%.

Employers must contribute to KiwiSaver for those of their employees who are KiwiSaver members.

Employers must calculate employer superannuation contribution tax (ESCT) at a rate equivalent to an employee’s annual salary and wage plus the employer’s annual gross contribution.

Employer superannuation contribution tax (ESCT)

Employer contributions to approved superannuation funds (such as KiwiSaver) are subject to ESCT, formally known as ‘specified superannuation contribution withholding tax’. 

ESCT rates are based on the employee’s annual salary and wage, plus the employer’s gross contributions. Additionally, the method for determining the employee’s annual salary and wage is dependent on how long the employee has worked for the employer. 

Contributions to other funds may be subject to fringe benefit tax (FBT).

Accident compensation levies

A statutory-based scheme of accident insurance is funded in part by premiums payable by employers and employees.

Premiums paid by employers (including the self-employed) fund insurance for work-related accidents. Employers are liable to pay a residual claims levy and an employer levy. Premiums are payable at a rate set for the industrial category on leviable earnings up to these amounts.

Non-work accident insurance is funded by premiums paid by employees and the self-employed. For the 2022/2023 year, the premium is a flat rate of NZD 1.46 per NZD 100 including goods and services tax (GST) on taxable earnings up to a maximum of NZD 130,911. This rate is expected to increase to NZD 1.53 per NZD 100 (including GST) from April 2023.

Fringe benefits tax (FBT)

FBT is payable by employers when a fringe benefit (non-cash benefit) is provided to an employee or an associated person of the employee as a result of their employment relationship with the employer. The value of fringe benefits provided is not included in the gross income of employees.

The FBT quarters end with the last day of June, September, December, and March. Returns are due within 20 days of the end of the relevant quarter, except for the fourth quarter return (March), which is due 31 May. Any employer who has provided a fringe benefit is required to file a return setting out the fringe benefits received or enjoyed by employees in the quarter and a calculation of the amount of FBT payable on those benefits. 

Employers with pay-as-you-earn (PAYE) and employer superannuation contribution tax deductions not exceeding NZD 1 million per annum for the previous tax year can pay FBT on an annual basis, or if the employer was not an employer in the previous tax year. An income year basis is also available for a company that provides fringe benefits to shareholder-employees.

Employers can pay FBT at either a single rate of 63.93% or use an alternate rate method (whereby benefits are attributed to employees). If the 63.93% single rate is used in all of the first three quarters, the employer may use an alternate rate calculation in the fourth quarter or continue to pay FBT at 63.93%. 

There are currently three alternate rate methods: the full alternate rate, the short-form alternate rate, and the new pooled alternate rate.

Under the full alternate rate method, the applicable FBT rate depends on the net remuneration (including fringe benefits) paid to the employee. For employees who received attributed fringe benefits in any quarter during the year, the employer must calculate the employee’s fringe benefit inclusive of cash remuneration. The attribution calculation, which is performed in the fourth quarter, treats the fringe benefit as if it was paid in cash and calculates FBT as the notional increase in income tax that would otherwise have arisen.

The short-form alternate rate applies at a rate of 49.25% to all non-attributed benefits and a rate of 63.93% to all attributed benefits. In general, a benefit is attributable to an individual if it is principally assigned to, used, or available for use by that employee. However, there are other specific attribution rules to consider, such as the attribution rules for unclassified benefits.

The new pooled alternate rate calculation method has been introduced effective for the FBT year beginning 1 April 2021. The calculation of FBT to pay under this method is determined as follows.

  • Attribute benefits are returned at:

    • 49.25% for employees who receive less than NZD 160,000 in gross cash pay and less than NZD 13,400 in attributed benefits.

    • 49.25% for employees who receive more than NZD 160,000 in gross cash pay or more that NZD 13,400 in attributed benefits but have 'all-inclusive pay' of under NZD 129,681.

    • 63.93% for all other employees.

  • Non-attributed benefits are returned at 49.25% (or 63.93% for shareholder employees).

A de minimis exemption may apply to exempt unclassified benefits from FBT. The thresholds for exempting unclassified benefits under the de minimis exemption is two-fold: 

  • NZD 300 per employee per quarter. 

  • NZD 22,500 per employer per annum.

Where the NZD 22,500 threshold is breached, FBT must be returned on all unclassified benefits. Where only the NZD 300 threshold is breached, FBT needs to be returned only on those amounts. 

Examples of benefits subject to FBT are as follows:

  • Motor vehicles.

  • Employment-related loans.

  • Employer contributions to medical insurance.

  • Employer contributions to employee superannuation funds.

  • Employer contributions to certain superannuation schemes (including foreign schemes).

FBT also applies to benefits received by an employee from a third party where there is a special arrangement between the employer and the third party. Generally, FBT does not apply to discounted goods or services received by an employee from a third party if the price paid by the employee is not less than the price that would be charged to other groups of people.

Benefits that are not subject to FBT include specified superannuation contributions (which are separately taxed), the provision of accommodation by an employer (which is subject to PAYE), and the use of a business tool such as a mobile telephone or laptop (provided the tool is used primarily for business purposes and the cost of the tool does not exceed NZD 5,000, GST inclusive). 

FBT is generally a tax-deductible expense. The effective FBT cost is intended to align with the receiving employee’s marginal tax rate.

FBT exemptions 

Three new FBT exemptions have been introduced in relation to self-powered and low-powered vehicles, vehicle-share services for self-powered and low-powered vehicles, and public transport.

Taxation of legal persons

New Zealand resident companies are taxed on their worldwide income, and non-resident companies (including branches) are taxed on their New Zealand-sourced income, subject to any applicable DTA.

The New Zealand corporate income tax (CIT) rate is 28%.

Value Added Tax

Goods and services tax (GST)

GST is a form of value-added tax (VAT) that applies to most supplies of goods and services, including low-value imported goods, services, and intangibles supplied remotely by an offshore supplier to New Zealand resident consumers. The narrow category of exempt supplies includes financial services. The rate applied to taxable supplies is currently 15% or 0%.

The 0% rate applies to a few supplies only, including exports and financial services supplied to other registered businesses. The 0% rate also applies to a supply that includes an interest in land between two GST-registered parties if the purchaser acquires the land with the intention of using it to make taxable supplies and the land is not intended to be used as a principal place of residence for the purchaser or an associate, or in relation to the sale of a business as a going concern.

There is also a ‘reverse charge’ mechanism that requires the self-assessment of GST on the value of certain services imported by GST-registered persons.

GST is also imposed on remote services provided by non-residents to New Zealand private consumers. The concept of 'remote services' is wide and includes streamed and downloaded digital products (e.g. music, movie, and game downloads, e-books, e-magazines) as well as remotely provided webinars, software, web design and publishing, insurance, gambling, consulting, IT, and professional services. Offshore sellers are also required to register and account for GST at 15% on supplies of low-value imported goods (LVIGs) if sales to New Zealand private consumers in a 12-month period exceed NZD 60,000. The NZD 60,000 threshold is the same GST registration threshold that applies to domestic businesses and offshore suppliers of cross-border remote services.

Non-residents who do not make taxable supplies in New Zealand can register for GST, provided they meet certain criteria, allowing them to claim a refund for their input GST costs.



Our office in Auckland count on the support of a firm of Accountants and Auditors founded in 2008 made up of 2 Partners as well as a staff of 12 people who work daily in the areas of auditing, payroll processing, accounting, tax assistance and compliance.  

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