Special types of workers: Non-residents

Taxing non-resident employees and contractors

Who is a non-resident?

Generally, a person is taxed as a non-resident if they:

• come to New Zealand, and
• stay less than 183 days in any 12-month period, and
• do not have an "enduring relationship" with New Zealand.

What are the New Zealand tax responsibilities of a non-resident?

A non-resident is liable for New Zealand tax on:

• income for personal services performed in New Zealand
• other payments from New Zealand sources.

Non-resident employees

You must deduct PAYE from wages paid to non-resident employees in the same way as for resident employees. However, a non-resident may be entitled to an exemption from New Zealand tax under either:

• a double taxation agreement>, or
• the 92-day rule>.

Non-resident contractors

Withholding tax needs to be deducted from payments for specified contract activities or services that you make to:

• non-resident individuals who are not your employees
• non-resident companies.

Non-resident entertainers

You must deduct withholding tax from payments to non-resident entertainers, unless payments are for a performance that:

• is part of a New Zealand or foreign government-sponsored cultural programme, or
• forms part of a programme of an overseas non-profit organisation, or
• relates to a game or sport, where the participants are the official representatives of the organisation that administers the game or sport in an overseas country.

Date published: 18 Jan 2007

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