On this page, you’ll learn:
• if you need to register for tax in New Zealand • how to register for tax • New Zealand’s income tax rates
• how income tax rates have fallen in recent times • what documents you need to file • when to pay the tax you owe
New Zealand’s IRD
Tax collection is carried out by New Zealand’s Inland Revenue Department, which prefers to be known as ‘IRD’ not ‘the IRD’.
If you have to contact them, you’ll usually do this by phone. The staff you’ll talk to are trained to be friendly and helpful; but they’re definitely not infallible.
As you might expect from any large organisation, the quality of information you get can vary. If you’re in any doubt about anything you’ve been told by phone, call again and speak to another IRD representative – it’s free.
Also, if you have any doubts about what you’ve been told, ask whoever you’re dealing with to send you a booklet about your particular query. If you write with your query, and request a written response, you should get a written answer – but it will take longer. IRD prefers telephone or online transactions.
Registering with IRD
If you live in New Zealand and you earn income, you must register with IRD for tax.
To do this you need an Inland Revenue Department Number (IRD Number). You don’t pay to get this.
Income Tax Rates In New Zealand
New Zealand’s tax year runs from the 1st of April to the 31st March. Here are the tax bands:
Income Tax Rates 2016 – 2017
|Your Income||Tax You Pay|
|$0 – $14,000||10.5%|
|$14,001 – $48,000||$1,470 plus 17.5% of any income in the range $14,001 – $48,000|
|$48,001 – $70,000||$7,420 plus 30% of any income in the range $48,001 – $70,000|
|$70,001 upwards||$14,020 plus 33% of income over $70,000|
A little more information
- If you have children, you may qualify for assistance – see Family Assistance.
- If you live overseas and have a bank account in New Zealand, the tax rate on the interest is 10% or 15% depending on where you live.
- All employees are taxed under the Pay as you Earn (PAYE) system, which means that the correct amount of tax is deducted from your wage before you get it.
- To ensure you pay the correct tax during the year, your employer will give you a tax code. For your main source of employment or sole employment your tax code should be ‘M’ or ‘ME’. You can check that you are on the correct tax code by using this IRD tax code flowchart.
- Employees will also have a small levy called an ACC earners’ levy deducted from their wages. For 2016-17 the rate is 1.39% of earnings. Self-employed people may have to pay a higher ACC levy.
- New Zealanders currently pay 10.5% tax on the first $14,000 of income; this is the lowest rate for over twenty years.
New Zealand tax rates have varied over the past few decades. The top rate of tax has remained below 40%. Currently New Zealanders pay 10.5% tax on the first $14,000 of income and a maximum of 33%; this is the lowest overall rate for over twenty years.
Will I need to file any documents with IRD?
Usually, you are not required to file if:
- You had no income during the tax year, or
- The income paid by your employer and/or your bank has already had the correct amount of tax deducted during the year, and
- You or your partner have not received any family assistance payments
If you need to file with IRD, it will be either a Personal Tax Summary (PTS) if you are a salary/wage earner or an IR3 if you receive other income.
When Do I Pay My Tax?
If you receive a PTS and have income tax to pay, the due date is the 7th February following the end of the tax year. For example, for the 2016 tax year ending on 31 March 2016, income tax must be paid by 7 February 2017.
If you’re unable to pay all of the tax you owe, Inland Revenue may agree to payments by instalments. It is best to contact Inland Revenue before the date your tax is due to set up an instalment arrangement, as this reduces any extra charges.
Did you know?
There is no gift duty in New Zealand, so any gifts received, including money, are not taxable and do not have to be declared to Inland Revenue.
New Zealand also has no death duties, inheritance taxes or stamp duties on property or share purchases.
Last Updated: June 2016