NZ - 2 simple(?) tax questions
Oct 20th 2002, 3:09 pm
#1
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Thread Starter
Joined: Oct 2002
Posts: 405
NZ - 2 simple(?) tax questions
Hello!
Just can't seem to get the answers for these 2 questions from NZ IRD website. Can anyone help? Thanks!
1) When both husband & wife work, how is their salary taxed, jointly or individually? (ex: say each earns $60,000)
2) If I decide to keep and rent out my USA home, will I have to pay any NZ tax on the rent income if I'm also paying US tax on it? (presumably answer would be same if rental home were in UK?) If the answer involves anything to do with any reciprocal agreement between NZ & USA, how/where can I get information about this?
Oh, and this would be with us on a PR visa...
THANKS!
TA
Just can't seem to get the answers for these 2 questions from NZ IRD website. Can anyone help? Thanks!
1) When both husband & wife work, how is their salary taxed, jointly or individually? (ex: say each earns $60,000)
2) If I decide to keep and rent out my USA home, will I have to pay any NZ tax on the rent income if I'm also paying US tax on it? (presumably answer would be same if rental home were in UK?) If the answer involves anything to do with any reciprocal agreement between NZ & USA, how/where can I get information about this?
Oh, and this would be with us on a PR visa...
THANKS!
TA
Oct 20th 2002, 5:00 pm
#2
Banned
Joined: Aug 2002
Posts: 7,613
Re: NZ - 2 simple(?) tax questions
1. Individuals are taxed as individuals. Low earning familires get extra help (http://www.ird.govt.nz/familyassista...finitions.html) but you will probably earn too much to qualify.
2. NZ taxes residents on worldwide income but has a double taxation agreement in place with USA - see http://www.taxpolicy.ird.govt.nz/int...roleofdta.html .
Cheers - Don
2. NZ taxes residents on worldwide income but has a double taxation agreement in place with USA - see http://www.taxpolicy.ird.govt.nz/int...roleofdta.html .
Cheers - Don
Oct 21st 2002, 4:23 am
#3
Guest
Posts: n/a
Re: NZ - 2 simple(?) tax questions
On Sun, 20 Oct 2002 15:09:09 +0000, The American
wrote:
>Hello!
>Just can't seem to get the answers for these 2 questions from NZ IRD
>website. Can anyone help? Thanks!
>1) When both husband & wife work, how is their salary taxed, jointly or
> individually? (ex: say each earns $60,000)
Individually.
>2) If I decide to keep and rent out my USA home, will I have to pay any
> NZ tax on the rent income if I'm also paying US tax on it?
> (presumably answer would be same if rental home were in UK?) If the
> answer involves anything to do with any reciprocal agreement between
> NZ & USA, how/where can I get information about this?
We are faced with the same. We are selling two properties and
retaining two more [1 lot and the house we currently live in which we
will rent out].
At this time, I am writing a letter to an old business friend in
Christchurch who now happens to own his own accountacy business.
I am hopefull he will be able to give us some heads up on this.
In the meantime:
United States of America
1982 Agreement
Status: In force
Signed: 23 July 1983
In force: 2 November 1983
Effective: In New Zealand: Income subject to withholding tax, from 1
April 1984; other provisions, from the income year beginning 1 April
1984.
In the United States: Income subject to withholding tax, from 1
January 1984; other provisions, from the taxable year beginning 1
January 1983. (refer Article 27)
Legislation: Double Taxation Relief (United States of America) Order
1983
Protocol to the 1982 Agreement
Status: In force
Signed: 23 July 1983
In force: 2 November 1983
Effective: In New Zealand: Income subject to withholding tax, from 1
April 1984; other provisions, from the income year beginning 1 April
1984.
In the United States: Income subject to withholding tax, from 1
January 1984; other provisions, from the taxable year beginning 1
January 1983. (refer Article 27)
Legislation: Double Taxation Relief (United States of America) Order
1983
As far as the IRS, I haven't done my taxes yet so will enquire from my
CPA when I have to contact him re filing.
Now what would be nice is the current situation where you can claim
expenses related to checking on the properties if you live out of
state.....
Cath
wrote:
>Hello!
>Just can't seem to get the answers for these 2 questions from NZ IRD
>website. Can anyone help? Thanks!
>1) When both husband & wife work, how is their salary taxed, jointly or
> individually? (ex: say each earns $60,000)
Individually.
>2) If I decide to keep and rent out my USA home, will I have to pay any
> NZ tax on the rent income if I'm also paying US tax on it?
> (presumably answer would be same if rental home were in UK?) If the
> answer involves anything to do with any reciprocal agreement between
> NZ & USA, how/where can I get information about this?
We are faced with the same. We are selling two properties and
retaining two more [1 lot and the house we currently live in which we
will rent out].
At this time, I am writing a letter to an old business friend in
Christchurch who now happens to own his own accountacy business.
I am hopefull he will be able to give us some heads up on this.
In the meantime:
United States of America
1982 Agreement
Status: In force
Signed: 23 July 1983
In force: 2 November 1983
Effective: In New Zealand: Income subject to withholding tax, from 1
April 1984; other provisions, from the income year beginning 1 April
1984.
In the United States: Income subject to withholding tax, from 1
January 1984; other provisions, from the taxable year beginning 1
January 1983. (refer Article 27)
Legislation: Double Taxation Relief (United States of America) Order
1983
Protocol to the 1982 Agreement
Status: In force
Signed: 23 July 1983
In force: 2 November 1983
Effective: In New Zealand: Income subject to withholding tax, from 1
April 1984; other provisions, from the income year beginning 1 April
1984.
In the United States: Income subject to withholding tax, from 1
January 1984; other provisions, from the taxable year beginning 1
January 1983. (refer Article 27)
Legislation: Double Taxation Relief (United States of America) Order
1983
As far as the IRS, I haven't done my taxes yet so will enquire from my
CPA when I have to contact him re filing.
Now what would be nice is the current situation where you can claim
expenses related to checking on the properties if you live out of
state.....
Cath
Oct 21st 2002, 4:26 am
#4
Guest
Posts: n/a
Re: NZ - 2 simple(?) tax questions
On Sun, 20 Oct 2002 15:09:09 +0000, The American
wrote:
>Hello!
>Just can't seem to get the answers for these 2 questions from NZ IRD
>website. Can anyone help? Thanks!
The Role of Double Tax Agreements
Income derived across an international border can potentially be
subject to double taxation as a result of two countries taxing the
same income. New Zealand relieves double taxation by unilaterally
granting its residents credits for foreign tax paid on income that is
also subject to New Zealand tax.
In addition, New Zealand has a network of 26 double tax agreements
(DTAs) with its main trading and investment partners which eliminate
certain forms of double taxation.
The focus of DTAs is wider than the elimination of double taxation.
They are aimed at reducing tax impediments to cross-border trade and
investment and assisting tax administration. This is achieved by:
* eliminating certain forms of double taxation
* reducing withholding taxes on cross-border investments
* prescribing how certain profits are to be calculated
* exempting certain short-term activities in the host state from
income tax
* providing certainty of treatment
* providing dispute resolution procedures; and
* enabling information to be exchanged between tax
administrations.
New Zealand's DTA network is targeted to include countries where real
benefits are likely to accrue. Benefits are likely to be limited if
there are low levels of trade and investment between New Zealand and
the other country or if the tax system in the other country does not
produce tax problems that a DTA would be expected to remedy.
For example, if income is not taxed in the other country or
withholding tax rates are at levels ordinarily set under DTAs, little
benefit is likely to accrue. Therefore, the emphasis of a DTA is on
resolving tax problems that are impediments to trade and investment
between two countries.
http://www.-
taxpolicy.ird.govt.nz/international/DTA/roleofdta.html
wrote:
>Hello!
>Just can't seem to get the answers for these 2 questions from NZ IRD
>website. Can anyone help? Thanks!
The Role of Double Tax Agreements
Income derived across an international border can potentially be
subject to double taxation as a result of two countries taxing the
same income. New Zealand relieves double taxation by unilaterally
granting its residents credits for foreign tax paid on income that is
also subject to New Zealand tax.
In addition, New Zealand has a network of 26 double tax agreements
(DTAs) with its main trading and investment partners which eliminate
certain forms of double taxation.
The focus of DTAs is wider than the elimination of double taxation.
They are aimed at reducing tax impediments to cross-border trade and
investment and assisting tax administration. This is achieved by:
* eliminating certain forms of double taxation
* reducing withholding taxes on cross-border investments
* prescribing how certain profits are to be calculated
* exempting certain short-term activities in the host state from
income tax
* providing certainty of treatment
* providing dispute resolution procedures; and
* enabling information to be exchanged between tax
administrations.
New Zealand's DTA network is targeted to include countries where real
benefits are likely to accrue. Benefits are likely to be limited if
there are low levels of trade and investment between New Zealand and
the other country or if the tax system in the other country does not
produce tax problems that a DTA would be expected to remedy.
For example, if income is not taxed in the other country or
withholding tax rates are at levels ordinarily set under DTAs, little
benefit is likely to accrue. Therefore, the emphasis of a DTA is on
resolving tax problems that are impediments to trade and investment
between two countries.
http://www.-
taxpolicy.ird.govt.nz/international/DTA/roleofdta.html
Oct 21st 2002, 5:29 pm
#5
BE Enthusiast
Thread Starter
Joined: Oct 2002
Posts: 405
Re: NZ - 2 simple(?) tax questions
THanks Don and Cath. Do either of you actually understand the info and its implications re double taxation agreements on NZ IRD site? Just wondering! I sure don't... 
Just about to refinance our home, w/ intention to rent it out, and want to be sure that even after NZ taxes the rent income will pay the mortgage (it would after USA taxes, but then NZ wants its share too if I understand correctly, and that's where things get fuzzy- i.e. how much DO they want? ). The exact numbers are not concerning us, just trying to get rough idea of how it works to be sure our NZ salary won't have to cover any costs for the USA home - would be pointless then to keep the house, as we'd have an investment yes, but *no life* in NZ.
Guess I need professional advice (yeah yeah!)
Cath, love to hear from you when your NZ accountant friend has gotten back to you.
Ciao, TA
Just about to refinance our home, w/ intention to rent it out, and want to be sure that even after NZ taxes the rent income will pay the mortgage (it would after USA taxes, but then NZ wants its share too if I understand correctly, and that's where things get fuzzy- i.e. how much DO they want? ). The exact numbers are not concerning us, just trying to get rough idea of how it works to be sure our NZ salary won't have to cover any costs for the USA home - would be pointless then to keep the house, as we'd have an investment yes, but *no life* in NZ.
Guess I need professional advice (yeah yeah!)
Cath, love to hear from you when your NZ accountant friend has gotten back to you.
Ciao, TA
Oct 21st 2002, 8:42 pm
#6
Guest
Posts: n/a
Re: NZ - 2 simple(?) tax questions
On Mon, 21 Oct 2002 17:29:28 +0000, The American
wrote:
>THanks Don and Cath. Do either of you actually understand the info and
>its implications re double taxation agreements on NZ IRD site? Just
>wondering! I sure don't...
>Just about to refinance our home, w/ intention to rent it out, and want
>to be sure that even after NZ taxes the rent income will pay the
>mortgage (it would after USA taxes, but then NZ wants its share too if I
>understand correctly, and that's where things get fuzzy- i.e. how much
>DO they want? ). The exact numbers are not concerning us, just trying
>to get rough idea of how it works to be sure our NZ salary won't have to
>cover any costs for the USA home - would be pointless then to keep the
>house, as we'd have an investment yes, but *no life* in NZ.
>Guess I need professional advice (yeah yeah!)
>Cath, love to hear from you when your NZ accountant friend has gotten
>back to you.
Yep - I have another couple of Americans in the same situ so will keep
ya'll in touch....
There was another page to the IRD pages I posted - follow the links
and you should pick it up.
US taxes are confusing period - when we moved from CA to TX, the State
of CA sent us an income statement for the period we were there which
we were to declare on the next tax filing.
Cath
wrote:
>THanks Don and Cath. Do either of you actually understand the info and
>its implications re double taxation agreements on NZ IRD site? Just
>wondering! I sure don't...
>Just about to refinance our home, w/ intention to rent it out, and want
>to be sure that even after NZ taxes the rent income will pay the
>mortgage (it would after USA taxes, but then NZ wants its share too if I
>understand correctly, and that's where things get fuzzy- i.e. how much
>DO they want? ). The exact numbers are not concerning us, just trying
>to get rough idea of how it works to be sure our NZ salary won't have to
>cover any costs for the USA home - would be pointless then to keep the
>house, as we'd have an investment yes, but *no life* in NZ.
>Guess I need professional advice (yeah yeah!)
>Cath, love to hear from you when your NZ accountant friend has gotten
>back to you.
Yep - I have another couple of Americans in the same situ so will keep
ya'll in touch....
There was another page to the IRD pages I posted - follow the links
and you should pick it up.
US taxes are confusing period - when we moved from CA to TX, the State
of CA sent us an income statement for the period we were there which
we were to declare on the next tax filing.
Cath
Oct 23rd 2002, 7:05 am
#8
Guest
Posts: n/a
Re: NZ - 2 simple(?) tax questions
On 22 Oct 2002 05:53:18 GMT, [email protected] (Mimi Forsyth) wrote:
>Cath-
>who is your accountant? Please email me at [email protected]
>www.mimiforsyth.com
I don't have one in NZ as yet.
We live in TX but use a CPA in CA.
I'd have to dig deep to find the name as we have only used him once
since our regular CPA gave up her business due to ill health.
Cath
>Cath-
>who is your accountant? Please email me at [email protected]
>www.mimiforsyth.com
I don't have one in NZ as yet.
We live in TX but use a CPA in CA.
I'd have to dig deep to find the name as we have only used him once
since our regular CPA gave up her business due to ill health.
Cath
