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Thread: Tax on UK£ Income when resident in NZ

  1. #1
    Join Date
    Jul 2006
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    Default Tax on UK£ Income when resident in NZ

    Does anyone have any experience of working for a UK company and being paid £ sterling after they have moved to NZ? Specifically how taxation is dealt with.

    My husband has been asked whether he would be willing to do some consultancy work for the company he is leaving. Whilst it would be useful for us to have some £'s coming in whilst we look for work I am a bit worried that it will end up complicating matters.

    My understanding is that UK-NZ have a double taxation agreement meaning he won't be taxed twice but I am assuming the UK company will deduct from source, which we will have to claim back as we will not be resident in UK, and NZ will then require tax to be paid on the income when we submit a tax return as we will be NZ residents.

    If anyone can confirm this or advise otherwise I'd appreciate it.

    Thanks,
    Melissa

  2. #2
    Join Date
    Jul 2006
    Location
    Dairy Flat, Auckland
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    Hi Melissa, First off welcome to the forum
    I think you will find this lead might help you
    http://www.ird.govt.nz/yoursituation...reign-inc.html
    We had a question we wanted answered and we contacted nz inland rev and they were extremely helpful.
    We used this email address and they responded in about a week nonres@ird.govt.nz

    Kindest regards


    Dave and Caroline
    Last edited by Dave in NZ; 18th October 2006 at 04:33 AM.

  3. #3
    Join Date
    Mar 2006
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    Wellington (from Beds, UK)
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    unfortunately the 4 year tax exemption does not apply to earned income.

    warney - we're in the process of considering this too but are probably a bit further away from having to make any decisions yet.

    the centre for non residents at HMRC may be able to help you - their details are here http://www.hmrc.gov.uk/menus/helpline.htm

    my initial take on it is that you'll have to pay uk tax and have it set against your nz tax return. let me know if you do get in touch with the CNR - i'd be interested in what they say.

  4. #4
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    Jul 2005
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    Bucklands Beach, Auckland
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    Quote Originally Posted by Trigirl
    my initial take on it is that you'll have to pay uk tax and have it set against your nz tax return.
    That is also my understanding of the situation. I too would be interested in any response from HMRC as I may be in a similar position to you.

  5. #5
    Join Date
    Jul 2006
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    Thanks everyone for the really quick responses, appreciate your help.
    I'll look into it further and post back when we have a confirmed answer from the powers that be.

  6. #6
    Join Date
    Feb 2005
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    New Plymouth - here to stay!
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    Worth popping into local tax office. They were very useful when i went in to find out about how i would be taxed on rent earned on a property in the UK while living abroad. There is a whole dept of the tax office that deals with these sorts of queries. You are right, there is a dual tax agreement that means you wont be charged twice on same income. I was told by tax office that i would be taxed in UK on income earned in UK (e.g property rental) which is great as you then make use of your £5k personal tax free allowance (which you don't get in NZ). Not sure how this work for living in NZ earning money from work for a UK company though. I guess if you are paid in sterling into a UK bank acct then the same rules would apply - you are taxed on UK income. I'd be interested to know what you find out.

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