Tax help with Abdul Tax exemption for new migrants Did you start living in New Zealand on or after 1 April 2006? If you did, I have some good news! You may qualify for a temporary tax exemption on certain types of overseas income. If you think you may qualify for an exemption your urgent attention is required as any Abdul Rafik is Inland Revenue’s election is subject to time restrictions which limit Migrant Liaison Officer retrospective claims. Background Normally, if you’re a New Zealand resident, you must pay tax on your worldwide income. This rule sometimes discouraged people from settling in New Zealand. To help solve the problem, a new exemption has been introduced to reduce tax costs faced by new migrants. Who qualifies for the exemption? Two types of people: 1. new migrants, and 2. returning New Zealanders. A “returning New Zealander” is someone who has been a non-resident (for tax purposes) for at least ten years. What income is exempt? Certain types of income you earn from overseas, including: • interest • dividends • rental income. Exceptions? You must pay tax on: • a salary or wage from an overseas employer, and • services income you receive from overseas. How long does the exemption last? The exemption starts when you arrive in New Zealand, and finishes when you’ve been here for 48 months (four years). Important message about Working for Families Tax Credits Working for Families Tax Credits is a financial assistance package for families with children. You can’t claim the exemption for new migrants and Working for Families Tax Credits. You can only claim one or the other. If you qualify for both, I recommend you consider each option carefully, and claim the one that offers you the most benefit. Do you have any questions? You can get more information about the exemption at www.ird.govt.nz by going to “Non-residents & visitors/For non-residents & visitors/Moving to New Zealand”.