· If you qualify by establishing a place where you habitually live in New Zealand. Your exemption starts on the day you establish that place.
The exemption period ends on the earlier date of:
· 4 years after the end of the month in which you have been in New Zealand for more than 183 days in any 12-month period.
· 4 years after the end of the month you established a permanent place of abode in New Zealand.
Also the 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
Under the transitional tax residency rule, most foreign sourced income is exempted, which covers foreign business income not related to the performance of services by the transitional residents, foreign interest and dividend income, rental and pension income derived from overseas, income from foreign-sourced royalties, as well as income attributed under the New Zealand CFC and FIF tax rules. However, foreign-sourced employment income and foreign-sourced income relating to services are not part of the exemption and will be taxed in New Zealand.
I would recommend migrants seek professional advice as early as possible even before their arrival in New Zealand so they understand how New Zealand tax laws apply to their financial positions and discuss with their accountants regarding best structure for their affairs after their move.
If you need assistance, contact Ingham Mora today and schedule a consultation with Gracy Qian. Let our experienced Tauranga accountant guide you through the complexities of New Zealand tax laws and ensure a smooth financial transition on your journey to New Zealand.