Taxes Affecting Retirees In New Zealand

Taxes affecting retirees in New Zealand are higher than the taxes most expats pay. Factor annual taxes in New Zealand and the United States into your retirement budget.

Income Tax Rates in New Zealand

Income tax rates in New Zealand range from 10 percent to 33 percent, depending on your income. To be eligible for the retirement visa, you must have an annual income of at least $60,000 which means you’re taxed at 30 percent. If you make over $70,000, your taxes will increase to 33 percent (Inland Revenue, 2011).
If you’re not in New Zealand on the retirement visa and have a total income under $14,000, your tax is added at 10 percent. If your income is between $14,000 and $48,000, your tax rate is 17.5 percent. If your income falls between $48,000 to $70,000 your tax rate is 30 percent (Inland Revenue 2011).
Any international income you receive is subject to New Zealand’s income tax, unless you’re not a legal tax resident. Non-residents are only liable for tax on income from New Zealand.
All tax forms are available to download from the Inland Revenue website. Non-residents must fill out a different form called the IR3NR Non-resident tax form.

Double Taxation in New Zealand Affecting American Retirees

Individuals who are tax residents in more than one country may be liable to pay income tax to both countries, though New Zealand has agreements in place with various nations that protect some residents from double taxation.
If after moving to New Zealand you have further questions about the Double Tax Agreement (DTA) and how it affects you, check with the United States Embassy or the New Zealand Department of Inland Revenue. Both departments provide up to date information on the taxes you’re required to pay.

Other Taxes in the New Zealand Taxation System Affecting American Retirees

Any profits made from real estate or other levies are subject to a Goods and Services Tax (GST). GST is added to all taxable goods at a rate of 15 percent (Inland Revenue, 2011). Exempt items and services include any interest received, rent income from a private home, donated goods and certain forms of income.
Unless otherwise stated, all goods and services have the GST of 15 percent added into their value. Cafes and other establishments may charge an additional 15 percent tax on all national holidays.
Taxes affecting retirees can be very expensive, so factor them into your projected cost of living in New Zealand.