2.5 Are you entitled to a 4-year temporary tax exemption
If you qualify as a transitional tax resident, you can be temporarily exempted from most types of oversea income including FIF (See 2.4) income. Please refer to 2.5.1 for more details.
You are a transitional tax resident if you:
- are a new migrant or New Zealander returning home
- are qualified as a New Zealand tax resident on or after 1 April 2006
- were not a tax resident at any time in the 10 years before you qualified
You are automatically entitled to the exemption if you qualify, and you can only be exempted once.
Your exemption will end earlier if:
- you opt out of it
- you or your partner apply for Working for Families Tax Credits
- you become a non-resident taxpayer.
2.5.1 Overseas income that is exempt when you are entitled to a 4-year temporary tax exemption
This income is exempt:
- Income attributed under New Zealand's foreign investment fund rules (FIF rules).
- Income attributed under New Zealand's controlled foreign company rules.
- Withdrawals from foreign superannuation schemes.
- Overseas income subject to non-resident withholding tax or approved issuer levy.
- Income arising from the exercise of overseas employee share options.
- Accrual income from overseas financial arrangements.
- Foreign-sourced beneficiary income from foreign and non-complying trusts.
- Rental income from overseas.
- Overseas interest and dividends.
- Royalties from overseas.
- Income you earned from working overseas before you came to New Zealand.
- Gains on sale of overseas property, held on revenue account.
- Overseas business income not related to the performance of service.
This income is not exempt,
· Foreign-sourced employment income.
· Foreign-sourced income relating to services.
Disclaimer: The content of this page is for educational purposes only. It is designed to help you understand the potential tax obligations that may apply to you when investing in financial products. Tiger Broker does not provide any advice, including tax advice, and is not responsible for providing any guidance, opinions, or suggestions about tax for you. If you have any questions about your personal circumstances and tax obligation, we suggest you contact your tax advisor directly for more information.