Kija

Thanks Genesis if we manage to sell our house we will have that to keep us going, but I'm very scared of eating into our savings that way. So far the plan is to put it into an account and use the interest to help us till we get jobs, we would also have rent money from a flat we rent out here in Cairo but I understand all these things are taxed. Do you (or anyone) have an idea of how much tax they take on savings accounts and rent/income from overseas? Any help in this is much appreciated as I am completely clueless with these things

NakiMan

In principle, NZ income tax is payable on ALL income worldwide. This applies even if the income is never brought into NZ. I don't know about Egypt, but there is an arrangement with many countries, that tax paid overseas is deducted from the amount payable in NZ.

As a new migrant, there is a special concession whereby overseas income is not taxed in NZ for the first 4 years.

Genesis

As from April 2006 ((that's the date I think) there is a 4 year amnesty for all new emigrees in respect to their overseas income. This means that you don't have to pay ANY tax on the aforementioned for the 1st 4 yrs in NZ. After that date you are charged at you prevailing tax rate which are 19.5% at the bottom and about 39% at the top. BUT if you take this offer you CANNOT claim for working for family tax credits (Thanks Lardyl) thats the manet from the govt. in respect to how many kids you have and what you earn..ie the less you earn and the more kids you have the more you get. Anyways when you arrive in NZ check with the www.ird.govt.nz to see if this offer is still in place. I am sure it will be. Which will be nice for you.

Kija

Thanks again Genesis! We won't need the working for family tax credits as we don't have any children, so the 4 year exemption would be terrific in our case.

Kija

Didn't know that, thanks very much NakiMan. So it would make more sense to bring in our capital from the house sale to New Zealand then I guess. Gosh it's all so complicated for me never was much good at these things

Kija

Thanks Lardyl Well (assuming we get there!) we'd probably be renting for at least a year till we settle in an area and get to know the place well before buying, but I've always liked investing in property, hence my lack of knowledge of banky things

This may sound daft but Egypt has only started implementing the mortgage system this year and I'm not very familiar with how it works, question is, which is better: if you have the capital to buy a house and pay for it fully, or to put a deposit on it and put the rest of the money in the bank to collect interest and use that to pay the mortage?

Jan n Neil

Mortgage interest is higher than savings interest. Usual advice is to pay off your mortgage as quickly as you can to bring those interest payments down. However if you need capital for other things then a mortgage is a cheaper way of borrowing than, say, a personal loan.

NakiMan

Depends what you want to do with your capital. If you're just going to bring it in to invest in NZ, then it generates interest in NZ and that becomes NZ income.

You will pay tax at 19% on the interest you earn.

Kija

Thanks Jan, Neil & NakiMan! I really appreciate the advice and I'm learning a lot here It's starting to make sense.