If you have a company with a PIE investment, you need to give the PIE the correct prescribed investor rate (PIR).
Prescribed investor rates
A company resident in New Zealand is a zero-rated investor and should use a PIR of 0%.
Non-resident companies have a PIR of 28% unless they’re notified foreign investors in a foreign investment PIE.
If your company is no longer a New Zealand resident, use a PIR of 28% from the date that it stopped being a New Zealand resident.
Foreign portfolio investment entity
Income from a multi-rate PIE
All income or loss from a multi-rate PIE must be included in the company tax return.
Your company can also claim tax credits (for example, RWT or imputation credits) in the tax return.
When to include the income in the company return
Your company’s income year may not line up with the PIE’s income year.
Include your company’s PIE income in your company’s return in the same year the PIE passes it on to you if either:
- your company and the PIE have standard 31 March balance dates
- your company’s balance date is later than the PIE’s balance date.
If your company’s balance date is earlier than the PIE’s balance date, the PIE income will be received in the next income year.
Dividends or distributions
Dividends or distributions received from a multi-rate PIE are not included in your company’s tax return.
Dividends or distributions from a listed PIE in excess of the fully credited amount are:
- treated as excluded income
- not included in the company’s tax return.
If a PIE makes an excluded distribution to a company investor and the company passes that distribution on to its shareholders, it is no longer treated as excluded income. Tax is payable on the distribution to the shareholder.