New Zealand Tax Guide for New Migrants and New Residents 2026
Moving to New Zealand? Learn when NZ tax residency starts, how the transitional resident exemption works, and what to do before you start work.
Updated April 2026
If you have recently moved to New Zealand - or are planning to - your tax obligations can start earlier than most people expect. Once you become a New Zealand tax resident, your worldwide income can become taxable here. But there is a valuable exemption in your first four years that many new migrants miss.
When NZ tax applies to you
You become a New Zealand tax resident when either of these is met:
- You have been in New Zealand for more than 183 days in any 12-month period.
- You have a permanent place of abode in New Zealand - a home you have the right to occupy on an ongoing basis.
The 183-day test is cumulative - the days do not need to be consecutive. Once you cross the threshold, your NZ tax residency is backdated to the first of those 183 days.
Example: Maria arrives in New Zealand on 1 September 2025. By 2 March 2026 she has been here 183 days. She is a NZ tax resident from 1 September 2025 - not from 2 March 2026.
Your first four years - the transitional resident exemption
New migrants who qualify as transitional residents can be temporarily exempt from tax on most types of overseas income. This is one of the most valuable tax benefits available in New Zealand, and many new arrivals do not know it exists.
| Usually covered | Usually not covered |
|---|---|
| Overseas interest and dividends | NZ-sourced income |
| Overseas rental income | Employment income earned in NZ |
| Some overseas capital gains | Income from NZ investments |
| Some foreign trust distributions | KiwiSaver |
The exemption lasts for about 48 months from the date you become a NZ tax resident. During this window, you generally do not need to declare many types of foreign passive income - such as interest, dividends, and rental income earned overseas.
Example: James moves to Auckland from the UK in January 2026. He has rental income from a property in London. Under the transitional resident exemption, he may not need to declare that UK rental income to IRD until the exemption ends. His NZ salary is fully taxable from day one.
You do not need to apply for the exemption - it applies automatically if you qualify. But you should keep clear records of when you became tax resident.
Getting your IRD number
You need an IRD number before you start work in New Zealand. Without one, your employer must deduct tax at the no-notification rate of 45%.
How to get one:
- Apply online through myIR if you have the required NZ identity documents.
- Apply using the IR742 process if you have a foreign passport.
- Have proof of identity and visa details ready if applicable.
Apply before you start work so payroll can use the right tax code from day one.
Picking the right tax code
When you start work, hand your employer an IR330 tax code form. For most new migrants, the correct code is straightforward.
| Situation | Tax code |
|---|---|
| Primary job, no student loan | M |
| Primary job, eligible for IETC | ME |
| Second job | S, SB, SH, ST, or SA |
| NZ student loan | Add SL, such as M SL |
The transitional resident exemption does not change your PAYE tax code - it affects what overseas income you may need to declare, not your payroll deductions.
See the full NZ tax code guide if you are unsure.
KiwiSaver - opt in or out?
KiwiSaver is New Zealand's workplace retirement savings scheme. When you start a new job, you may be automatically enrolled unless you opt out.
| Detail | 2026 setting |
|---|---|
| Default employee contribution rate | 3.5% of gross pay |
| Employer contribution | Minimum 3.5%, subject to eligibility |
| Government contribution | Up to $260.72 if eligible |
| Opt-out window | 14 to 56 days from starting work |
If you are planning to stay in New Zealand long-term, KiwiSaver is generally worth considering because of employer contributions and the government contribution.
If you are here temporarily and plan to leave, check the rules before opting in or out. If you leave New Zealand permanently, you may be able to withdraw your KiwiSaver balance, subject to the withdrawal rules.
Example: Ben starts work in Wellington earning $70,000. He contributes 3.5%, which is $2,450 per year. His employer contributes at least 3.5% before employer superannuation contribution tax, and he may also qualify for the government contribution if he meets the rules.
Overseas income - what to declare
During the transitional resident exemption period:
- NZ income - fully taxable, declared through PAYE or IR3.
- Overseas employment income - may still be taxable in NZ, depending on where the work is performed and treaty rules.
- Overseas passive income - often exempt during the transitional period if you qualify.
After the transitional period ends, worldwide income generally needs to be declared in your NZ tax return.
If you have overseas investments - particularly shares in foreign companies - the Foreign Investment Fund, or FIF, rules may apply. These are complex and worth checking before your transitional period ends.
Double tax agreements
New Zealand has double tax agreements with many countries including Australia, the UK, the US, Canada, and much of Europe. A double tax agreement helps stop the same income being taxed twice.
If you pay tax on income in another country and also need to declare it in NZ, you may be able to claim a foreign tax credit in your IR3 return. Keep evidence of tax paid overseas.
ACC - what it is and what it costs
ACC covers injuries in New Zealand and replaces the ability to sue for most personal injuries.
As an employee, ACC earners' levy is deducted automatically through payroll.
| 2026-27 rate | Earnings cap |
|---|---|
| 1.75% | $156,641 |
You do not need to do anything - it is handled by your employer alongside PAYE. If you are self-employed, ACC invoicing works differently.
FAQs
Do I pay tax on money I bring into New Zealand?
No. Transferring existing savings or capital from overseas into a NZ bank account is not income. Income earned on that money can be different.
What if I am only here temporarily on a work visa?
If you are in NZ for more than 183 days in any 12-month period, you can become a tax resident regardless of your visa type. Your NZ employment income is taxable from day one.
When do I stop being a NZ tax resident?
Usually when you leave New Zealand permanently and no longer have a permanent place of abode here. IRD looks at ongoing ties such as property, family, and regular return visits.
Do I need to file a tax return in my first year?
It depends. If you only have PAYE income and no overseas income to declare, IRD may assess your tax automatically. If you have overseas income, self-employment income, or rental income, you may need to file an IR3.
Can I claim the transitional resident exemption if I was in NZ before?
Only if you meet the eligibility rules, including the prior non-residence requirement. The exemption can generally only be used once.
What is an IRD number and do I need one?
Yes. An IRD number is your NZ tax identification number. You need one to work, open a bank account, and access many government services.
General information only - not tax advice. Sources: IRD tax residency, IRD temporary tax exemption, IRD KiwiSaver changes, and IRD ACC earners levy rates.