Tax

The information provided here is intended to provide an overview only. For specific advice on your own tax affairs, please see the New Zealand Inland Revenue Department (IRD) or contact a tax advisor.

Taxation

Most people who work for an employer in New Zealand are paid a wage or salary directly into a bank account on a weekly, fortnightly or monthly basis.

Employers usually deduct income tax from employee wages and send the tax payment to the New Zealand Inland Revenue Department.

Applying for an IRD Number

An IRD number is a unique identifying number that you use for all your contacts with Inland Revenue.You will need an IRD number before you start a job or open a bank account.

If you do not have an IRD number your employer or bank will deduct tax from your salary at the 'no declaration' rate. This rate is much higher than the standard deduction rates and will significantly reduce the net income you receive.

To apply for personal number you need to complete the appropriate application form (IR 595) and return it to the Inland Revenue along with identification such as a copy of your birth certificate or passport.

Personal taxation

Income tax on earnings is required to be paid to the New Zealand government. Most people pay their taxes as they earn, and their employer deducts tax on their salary/wages. This is known as PAYE (Pay As You Earn) tax.

Banks and other financial institutions deduct Resident Withholding tax on interest as it is earned.The following types of income are taxed:

  • Salary and wages;
  • Business and self-employed income;
  • Most social security benefits;
  • Income from investments, rental income;
  • Profit from selling capital assets - but this does not usually apply to personal assets income you earn from overseas.

Goods and Services Tax (GST) of 12.5% is placed on everything you buy in New Zealand, except for financial services and the rent or purchase price of residential property.

Price tags in shops always include GST, so you needn't add anything to the display price.

If you are in New Zealand in 2005/2006 you will pay tax on your personal income as follows:

  • $0 - $38,000: 19.5%
  • $38,001 - $60,000: 33%
  • $60,001 upwards: 39%

In addition to these payments, you also pay 1.2% of your wage for accident insurance (ACC levy).

WINZ 

The New Zealand Government's social security agency, Work and Income, provides free job-seeking services for unemployed residents.

WINZ can assist unemployed New Zealand residents with all aspects of finding a job, including job search preparation, careers advice, and support once a jobseeker gets a job.

WINZ offices are throughout many city suburbs and major country centres.

Qualification & Skills 

The job training market is competitive and some employers may not recognise overseas qualifications and training.

If your qualifications are not recognised, jobseekers may have to consider extra study or retraining to get the job they want.

Some occupations have special requirements. This may include registration or licencing with a government authority and/or membership of a professional or industry association.