Tax Figures
Income Tax Rates
Monthly Taxable Income.
Expats are able to offset their taxable income with relevant business expenses.
Note that married people are taxed separately not jointly on all types of income.
- 0 – 14,000: 10.5%
- 14,000 – 48,000: 17.5%
- 48,000 – 70,000: 30%
Time to prepare and Pay Taxes
152 hours
Employers Social Security and statutory contributions
There is no Compulsory Social Security Scheme in NZ but employers are required to pay a levy towards the Comprehensive no fault Accident Compensation Scheme. Levies are payable on income up to NZD 118,191 for year ending 31 March 2015. Rates are dependent on industry.
Employees Social Security and statutory contributions
There is no Compulsory Social Security Scheme but employees are required to pay a levy towards the Comprehensive no fault Accident Compensation Scheme. Levies are payable on income up to NZD 118,191. Rates are 1.45% from April 2014.
Payroll
There are specific rules for payroll and taxation in New Zealand, depending upon whether your company employs foreign nationals or local New Zealand employees. A state-operated social welfare system provides benefits during sickness, unemployment, disability and retirement and is funded by general taxation.
The primary concerns for a foreign company that needs to comply with tax laws in New Zealand are: individual income tax (IIT) for employees in New Zealand, social security costs, payroll tax, sales tax, withholding tax, business tax and permanent establishment concerns.
Remote Payroll
A remote payroll in New Zealand is where a foreign company, i.e. a non-resident company, payrolls a resident employee in New Zealand. This applies to both local and foreign employees. The foreign company will need to register a branch, apply for an IRD and then register as an employer with the Inland Revenue. One option for a non-resident company to payroll its employees (local and foreign) in New Zealand is to use a fully outsourced service like a GEO which will employ and payroll the staff on their behalf.
Local Payroll Administration
In some cases, a company will register their business in New Zealand under one of the forms available, (Branch Office, Limited Liability Company, or Limited Partnership) but prefer to have another company administer its payroll. This can be accomplished through a payroll provider. It is important to note that the company, as the Employer of Record, is still fully responsible for compliance with employment, immigration, tax and payroll regulations. But the payroll calculations, payments and filings can all be outsourced to the payroll provider.
Internal Payroll
Larger companies with a commitment to New Zealand may wish to run their own local payroll for all employees, foreign and local. In order to accomplish this, they will have to complete incorporation, register the business and then hire the necessary staff. There will be a need for in country human resources personnel who have the background needed to manage a New Zealand payroll, and can fulfill all tax, withholding, and payroll requirements.
This approach carries significant cost and requires some knowledge of local employment and payroll regulations. The company will need a local accounting firm and potentially legal counsel to ensure full compliance with New Zealand employment laws.
Currency
New Zealand Dollar (NZD)
