Tax on PIE income
A PIE that is not a:
- company listed on the New Zealand stock exchange, or
- defined benefit fund, or
- portfolio investment-linked life fund
will use your prescribed investor rate (PIR) to calculate the tax on the income from your investment.
The PIR is based on your taxable income in the last two income years, for example, income from salary, wages and any additional sources of income that you would include in your income tax return. You cannot elect a rate or use a "blended" rate.
Tax on PIE income that does not have to be included in your tax return will be paid by the PIE.
Note
A PIE listed on the New Zealand stock exchange may continue to pay dividends. As a New Zealand resident individual investor you can choose whether or not to include the dividends in your tax return.
When your PIE income is derived
If you have a balance date other than 31 March, your PIE income is derived in your income year which includes the end of the PIE's income year. See the following examples.
| If you have a ... | and ... | then ... |
|---|---|---|
|
30 June 2009 balance date which is your 2009 income year |
the PIE you invest in has a 31 March 2009 balance date |
as the end of the PIE's 2009 income year falls within your 2009 income year, your income for the 2009 income year will include the allocated income from the PIE up to 31 March 2009. |
|
31 December 2008 balance date, which is your 2009 income year |
the PIE you invest in has a 31 March 2009 balance date |
as the end of the PIE's 2009 income year falls after the end of your 2009 income year, the allocated income from the PIE for the year ended 31 March 2009 will fall into your 2010 income year. |
Date published: 11 May 2008
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