How company tax works in New Zealand
A simple guide to the 28% company tax rate, what taxable profit means, and why company tax planning often connects to GST and imputation credits.
Company tax basics
Most New Zealand companies pay income tax at a flat 28% on taxable profit.
That sounds simple, but the important part is understanding what counts as taxable profit. It is not always the same as your accounting profit, because tax rules can treat some expenses, timing differences, and deductions differently.
A simple example
If a company has taxable profit of $100,000, the starting company tax estimate is:
- Taxable profit: $100,000
- Company tax rate: 28%
- Estimated company tax: $28,000
This is why a simple company tax calculator is useful for planning and budgeting, even before final accounts are complete.
What to watch carefully
- Losses carried forward can change the final result.
- Shareholder drawings are not the same as company tax.
- Provisional tax can affect cash flow during the year.
- Imputation credits matter later when dividends are paid.
When this matters most
This kind of estimate is useful when you are budgeting for year-end tax, discussing dividend plans, or checking whether your company is keeping enough cash aside for tax.