1. The "Welcome Home" Gift (TRE)
New migrants or returning residents (who were absent for >10 years) get a massive tax break. You are a Transitional Resident for 48 months.
What is Tax-Free?
- ✓ Foreign Interest: NRE/NRO FD Interest is exempt in NZ.
- ✓ Foreign Dividends: Indian stock dividends are exempt.
- ✓ FIF Income: No FIF tax on Indian Mutual Funds.
The 48-Month Window
After Month 48, you become a standard Tax Resident.
2. The Foreign Investment Fund (FIF) Trap
The most complex rule for Kiwis with Indian Stocks/Mutual Funds.
If the total cost (not current value) of your foreign shares/funds exceeds NZD $50,000, you fall under FIF rules.
The "Fair Dividend Rate" (FDR) Method
You pay tax on 5% of the Opening Market Value (April 1st) of your portfolio, regardless of actual dividends or profit.
Example: Portfolio worth $100k on Apr 1. Taxable Income = $5,000. Tax to pay (~33%) = $1,650. Even if the market crashed!
Am I caught by FIF?
3. Income Stream Matrix
NRE Interest
🏦NZ (TRE): Exempt.
NZ (Resident): Fully Taxable. The "Tax Free in India" status is ignored by IRD.
India: Tax Free.
Indian Rental
🏠Taxable in Both.
You claim a tax credit in NZ for the taxes paid in India (TDS).
KiwiSaver / EPF
🥝Withdrawals:
Indian EPF withdrawals after becoming NZ resident might be taxable under the "Foreign Superannuation" rules (schedule method).
4. The Perfect Sync
Unlike the US (Jan-Dec) or Australia (Jul-Jun), New Zealand and India share the exact same tax year.
- New Zealand: April 1 - March 31
- India: April 1 - March 31