Yahoo Finance Helping with your tax questions
What is the best savings account re interest, to open for my NZ based grandchildren. I live in the UK and wonder where best to invest NZ or UK?
The Financial Advisers Act 2008 restricts who can give specific advice on investments in New Zealand. I am not a financial adviser so I am limited to giving general advice as I am an accountant. To be more specific, I am a Chartered accountant. Many people ask “what is the difference between an ‘accountant’ and a ‘chartered accountant’?”. Basically, a chartered accountant is a member of the New Zealand Institute of Chartered Accountants which has its own legislation. The institute is self governed and has a code of ethics and members have continued professional development requirements. An accountant is simply ‘somebody suitably qualified’ of which I am not aware of a legislative definition. This means that a wide range of people could use this term, while the chartered accountant designation is reserved by law for institute members. When it comes to financial advice, you may need to have both an accountant and financial adviser to get both specific and general advice, unless your accountant is also a financial adviser. In terms of general advice I can discuss tax implications and other areas such as risk and return. Generally the higher the risk, the higher the return is required and vice-versa. What this means is that regardless of where in the world the investment is, you need to weigh up risk factors of losing part or all of your investment versus how much you will make if the investment matures. Taxes can also be a factor in your net return, and this is where advice may need to be obtained especially where more than one country is involved.
Can you claim as an expense sharebrokerage fees?
Not if you are holding the shares for long term investment in which any gains or losses in share values is generally not taxable. If you are a share trader then you would claim the fees, but of course your share gains and losses would also be taken into account for income tax as you would need to file a tax return.
How does a Capital Gains Tax operate in NZ and is the Labour Party's CGT any different?
I won’t specifically discuss any party’s tax policies. What I will say is that we already have a number of effective capital gains taxes in NZ. For example there is the Foreign Investment Fund (FIF) regime and if you are a builder or property developer then you may be liable for tax on capital gains on investment property through land tax. In my opinion it is only a matter of time before more capital gains taxes are introduced into our tax system.
I receive a small pension from the uk. I also receive an Australian pension. My Australian pension is reduced because of the UK pension. In NZ I have to pay tax that reduces my pension to a point that it is not possible to live on it. How can this be justified?
I suggest that you have a look at the Work and Income website to see if the Special Banking Option would be appropriate for your situation. If it is appropriate, then you would probably be on a level playing field with every other New Zealander receiving New Zealand superannuation.
Here is a tax residency head scratcher for you, it doesn't come much greyer than this! I have been overseas working on superyachts for over 15 years. I am only ever in NZ to visit family on average once per year for a few weeks at most. I do not own property/furniture or vehicles in New Zealand. I belong to maybe 2 clubs or associations joined well before I left NZ. In essence, only my mail goes to a NZ address which I collect on the odd occasion when I am home. I have an old NZ bank account still but cannot remember the last time money went into it or a withdrawal was made, the balance would be lucky to reach 4 figures and because of the account type, it no longer earns interest so I have not had a withholding tax certificate for many years; in essence I have forgotten about it. The closest thing I maintain to a connection with NZ would be a health insurance policy. Meanwhile, at the other end, yacht crew are generally permanently domiciled on the global-travelling vessels they work on which in many cases, are never based in any jurisdiction long enough to even vaguely qualify for tax residency. Yacht crew pay is generally in USD or EUR via the boat's owning company (not USA or EU-sourced income in my case to clarify) and is normally banked in offshore accounts. In my case, the bank interest rate has steadily decreased to zero over the years so I am not actually earning on these savings and therefore not liable for even withholding tax on the account either.
So my question is: where would somebody like me fit into the system?? I guess the next question is: once I hang up my sea boots and should I decide to return to reside in NZ, how do I fit back into the Kiwi system once again?
Probably without further information your situation remains unclear. It could be argued that you have never lost NZ tax residency through your ‘enduring relationship’ with NZ (family, associations etc.). If you had as many of these relationships overseas then maybe it could be argued that you have lost NZ tax residency through the 325 day rule. I would recommend professional advice.
I work permanent full time 40 hrs a week and I do get a interest on the amount in the bank in the form of term deposit. What should be my tax code? It says ME on my pay slip.
Please refer to https://nz.finance.yahoo.com/blogs/tax-time/what-is-the-independent-earner-tax-credit--ietc---233444584.html You should check out the IRD form 330 which has a flow chart to guide you to the correct tax code.
The IRD tax form asks if you have received income from an estate or trust. My mother's estate was finally distributed between siblings after three years of waiting for property to be sold. The estate paid taxes during this time. Do I declare the share of final distribution as income?
The key here is whether you received income or capital (or both) from the estate. Most likely is that an estate normally retains the income and pays tax on this and then distributes the after tax income as capital. Assuming this estate was in NZ, you do not need to declare the capital in a tax return. If for some reason the distribution is income, then this would need to be included in your personal tax return along with any tax credits available. The same situation applies to trusts.
if someone goes to Australia to live but has a student loan here do they still need to pay each year if they are not working at all over there?
There is the option for applying for a ‘repayment holiday’ for up to one year (although interest still accrues). Apart from that there are still repayment obligations. See the IRD guide IR223 for more detailed information.
Disclaimer:
Any views the writer has expressed are his own and not necessarily those of Accountants On Elliott LP. The information supplied has been written in general terms only. This information should not be relied upon specifically without also obtaining appropriate professional advice after detailed examination of your particular situation.
