Introduction to taxation

Taxation in New Zealand is designed to be simple and fair.

Personal Income

33% from $70,000

30%: $48,001 to $70,000

17.5%: $14,001 to $48,000

10.5%: $0 to $14,000

Company income

28%

Tax credits

Working for Families credits for low and middle income earners.

Social security & insurance levies etc 

Social security and health: Covered by general tax, though many people have private health insurance.
ACC (New Zealand’s unique accident compensation scheme): Earners pay 1.39% up to a maximum of $126,286 in earnings (2018/19 tax year). Motorists pay a levy with their annual car registration. Employers pay insurance cover based on industry risk.

Capital gains

Capital gains are usually not on New Zealand investments, but applies to foreign debt and equity investments

Dividends

Imputation system to avoid double tax.

Tax on savings

Little tax relief on contributions to New Zealand retirement schemes, but saving is not compulsory. Tax paid at normal income levels at source, but distributions are tax free. No mortgage interest tax benefits, except for investment property.

Fringe benefit tax (FBT)

This is paid by employer, up to a rate of 49.25% for employer provided cars, low interest loans, medical insurance premiums, foreign superannuation contributions etc. FBT is tax deductible so employer cost is effectively the same as paying cash remuneration.

Sales & excise tax

Goods and services tax (GST) of 15% on most things.
Excise tax paid on petrol, tobacco, alcohol.