Managing banking, money, and taxes in New Zealand is fairly simple. Kiwi banks are modern, offering comprehensive packages and high-quality customer service. Opening a bank account is generally straightforward; you’ll need only a few documents. EFTPOS debit cards are readily accepted, but not all merchants take credit cards or cash – something to keep in mind when shopping in New Zealand. Even though electronic payments are preferred, ATMs are common and easy to find.
Paying taxes in New Zealand is equally uncomplicated, with clear rules defining tax liability and tax residency status.
Money in New Zealand
The currency in New Zealand is the New Zealand Dollar (NZD), which is divided into 100 cents. It is normally written as NZ$ to distinguish it from other dollar currencies.
- Notes: NZD 5, NZD 10, NZD 20, NZD 50, and NZD 100
- Coins: 10 cents, 20 cents, 50 cents, NZD 1, and NZD 2
Banking in New Zealand
Banking in New Zealand is relatively uncomplicated. The largest banks in New Zealand are ANZ, Bank of New Zealand (BNZ), ASB, and Westpac.
All banks have accessible online banking services that allow account holders to transfer funds or pay certain municipal bills and other services online. Cashless and contactless payments are popular in New Zealand – Kiwi banks provide a range of solutions to help streamline the process.
Opening a bank account
The requirements for opening a bank account in New Zealand vary from bank to bank, but the application process is usually quite simple. Foreign applicants will need identification, proof of residence, and their visa. Conveniently, accounts can be set up quickly, and new bank cards are usually issued on the same day.
It is advisable to research the available banks and their offerings. Some banks may charge fees for certain services, like transactions or monthly statements, while others don’t. Generally, you’ll be offered a choice between a current and a savings account or a package that includes both.
Some banks, such as the Bank of New Zealand, allow expats to apply for an account online before they have even arrived in the country.
Credit cards and ATMs
Bank cards are accepted practically everywhere in New Zealand, with electronic payments being preferred most of the time. It is worth noting that international credit cards, like Visa and MasterCard, are not as readily accepted as EFTPOS cards. When you open a bank account in New Zealand, you’ll typically be given such a card. While these cards are usually free of charge, they are only usable in New Zealand or Australia and can't be used for online payments.
Taxes in New Zealand
New Zealand has simple tax laws, making it a favourable tax environment for investors and expats alike.
Local income tax is calculated on a progressive scale depending on income and is capped at 39 percent. If you are in New Zealand for less than 183 days of any 12-month period, you’ll only pay taxes on locally earned income. On the other hand, you’ll be considered a tax resident if you live in New Zealand for 183 days or more in any 12-month period. This means that you will be liable to pay tax on income earned worldwide. If you’re a tax resident of more than one country, New Zealand offers credits to avoid double taxation.
As a new arrival, you might also qualify for a temporary tax exemption on overseas income and be classified as a transitional tax resident. The exemption lasts for four years and covers numerous sources of international income, including royalties, interest, and rental.
New Zealand's tax system supports foreign investors, with no capital gains, inheritance, estate, or healthcare taxes aside from property rates. That said, it's also important to note that New Zealand has an expanded concept of income compared to many other countries, and these other taxes are generally wrapped into income tax. There is also a blanket Goods and Services Tax (GST) of 15 percent factored into most things that expats buy in New Zealand. Additional taxes are also paid on alcohol, tobacco, and petrol.
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