etf tax nz

You will have tax deducted on the interest when it’s paid, as well as at the end of the tax year (31 March). This is a market capitalisation index of the 40 NZ listed companies below the top 10. 1% of the amount transferred or $500 (whichever is greater). Paying tax on investments and savings in NZ. In NZ - let's say our family who are retired NZers, living in NZ - invest 500,000 into Simplicity balanced fund for arguments sake. The PIR applies to investments that are structured as Portfolio Investment Entities (PIEs). In addition, tax doesn’t just apply when you cash out to NZD, but when you make a disposal that results in a realised gain or loss – such as trading one crypto for another, or a crypto to another fiat currency like USD. Kernel is 100% Kiwi owned and are committed to no-nonsense index funds with low, transparent fees. Whether you decide to invest in index funds, ETFs, or both, there are some smart ways to save money to increase your profits in the short and long-term. Let’s be friends on Facebook, Twitter, or via email so you can keep up with the latest news and posts! Index ETFs. 10 Top Investments for Young New Zealanders, Investing in the US Stock Market from New Zealand, Barefoot Investor-Friendly Financial Products in New Zealand. The main ways that Kiwi investors might come into possession of FIFs are: I’ll focus on how the above FIFs are taxed. Australia has a similar concept known as franking credits. ETFs held for more than a year are taxed at the long-term capital gains rates, which goes up to 23.8%, including the 3.8% Net Investment Income Tax, while those held for less than a … With ETFs you buy units in an investment fund that invests in a basket of securities, like company shares, bonds and other assets – all in one go. I will provide more specific info on each case below as you read along. If you don’t provide your rate to your investment provider, you’re automatically taxed at the top tax rate. You may wish to consult with an authorised financial adviser before making any investment decisions. Capital gains on shares are generally not taxable, that is unless the IRD considers you a “trader”. If you recently got a pay increase, as you can use a tax rate that’s based on a previous year’s income. Free ratings, analyses, holdings, benchmarks, quotes, and news. The purpose of imputation credits is to mitigate double taxation, given dividends are essentially a company’s profits, which they may have already paid company tax on. At Sharesies, we make things easy by paying income tax on your investments for you. If the two holders of a joint account have different RWT rates or PIRs, the investment provider will usually tax the account at the higher rate. In rare instances, a provider will change a price or product before we've had a chance to update our information; double check prices first before making any decision. You can deduct expenses that relate to the rental from your income, such as insurance, rates, maintenance, and property management fees. Bank ETFs. As an investor, the rate at which you are taxed at depends on what kind of fund it is. PAYE and RWT) you may have made during the year. The most common method to convert foreign amounts to NZD is to use the actual exchange rate on the day of each transaction. This level playing field, means that investors can simply focus on fees. Withholding tax on dividends can get trapped in an offshore investment entity (i.e. Further Reading:IRD – Questions & answers: Cryptocurrency and tax. InvestNow Tip: Use the ‘Fund Type’ dropdown on InvestNow’s Fund Search page to filter funds by type. If you buy an ETF in a non-NZD currency, the value of your investment in New Zealand Dollars will change as the exchange rate goes up and down. LOWER COSTS The funds keep costs down because in most cases we do not need to make active investment decisions, which may require spending on research and analytical expertise. Your KiwiSaver provider will handle all the taxes for you, so you don’t have to do anything apart from making sure they have your correct PIR. ETFs are bought on a sharemarket, which means you'll pay brokerage and face bid/offer pricing (the difference between the price available to purchase at and the true value of the units in the fund). Given the fixed RWT rate of 33%, those on a lower tax rate may be able to file a tax return to claim back their excess tax paid. For example, if your annual income is $30,000, the most appropriate RWT rate for you would be 17.5%. Source: nzx.com/instruments/MZY (please note prices will have changed). Once you have selected a method, and calculated your taxable income, you will need to pay tax on that income at your marginal tax rate. You must apply FIF tax rules if you hold over $50,000 in FIF investments. Estimated revenue for an ETF issuer is calculated by aggregating the estimated revenue of the respective issuer ETFs with exposure to New Zealand. Which means you could be taxed on capital gains that you wouldn’t usually be taxed for! Index ETFs offer low-cost and tax efficient access to diversified portfolios. You bought the property with the intention to resell it for a profit, You have a history of buying and selling property which could see you considered a property dealer, You are in or associated with the building industry, The ‘Bright-Line test’ – You sell within 5 years of purchase. ... (ETFs). Further Reading:IRD – IRD numbers for individuals. More funds = less diversification? If you don’t need to file a tax return, there are some cases where it may be beneficial for you to still do so. If you invest in certain ASX listed Australian companies (typically those who pay franking credits with their dividends), the FIF tax rules do not apply to them. Learn everything about iShares MSCI New Zealand ETF (ENZL). Entry fee. It’s important to give your fund manager or fund platform your correct PIR, as you can’t claim back any overpaid tax with MRPs. Funds contain assets like shares and bonds, which generate taxable income (such as dividends, interest, foreign income) and tax credits. We link to other websites throughout this website, but take no responsibility for the content they publish. Tax on residential property is a step up in terms of complexity, so this is just an extremely basic and simplified overview – there are heaps of rules and caveats I won’t cover here. Most salary and wage earners do not have to complete a tax return, as all of their taxable income will be covered by the above Income Tax Assessment. ETFs are simply funds in which you can buy and sell their units on the sharemarket (in the same way as shares in an ordinary company) – hence the name Exchange Traded. Index funds and ETFs have some key differences when it comes to tax and buying and selling costs, as we outline below: Tax - New Zealand ETFs are classed as listed PIEs, which means the tax rate is fixed at 28%.If you pay a lower tax rate, you'll have to claim the overpaid tax from the IRD on your tax return at the end of the financial year. To declare your rental income, you must complete an IR3R form for each rental property, as part of your tax return, and keep any records of income and expenses for 7 years. Index funds have a number of advantages over ETFs, and we explore these in detail below. Tax on FIF investments need to be declared and paid in New Zealand Dollars. Which rate you’re taxed at depends on the type of investment you’re in. This income could be (copied from the IRD): The Income Tax Assessment determines whether you have a tax bill or tax refund for the year, correcting any under or over payment of tax (e.g. We outline the most important facts below. The ETF tax nightmare in Australia. For example, you may want to invest in a fund that tracks the performance of the top 50 NZ companies listed on the NZX (NZX 50). The Smartshares range of ETFs includes socially responsible international equity exposure, ... without having to worry about the complexity of managing foreign currencies or overseas tax. In many cases, Resident Withholding Tax (RWT) or PIE tax is automatically deducted from you at a certain point in time, like when the income is paid – in the same way PAYE tax is deducted from your salary or wages. The information should never be used without first assessing your own personal and financial situation, and conducting your own research. Phew, that was a mission to write up, and I am just scratching the surface of tax in this article. RWT is not a final tax, so if you choose the wrong rate you’ll receive a tax bill/refund at the end of the year to reflect any over or underpaid RWT. If so, you may be taxed on your dividends and capital gains. expense you pay, particularly when it comes to tax on your investments. This is because both investment options focus on diversifying risk; going all-in on Xero may seem obvious now, but no investment manager would ever take sure a risk. Trusted by more than 1,000 Kiwis, Kernel offers easily accessible index fund investing. Further Reading:KPMG – Tax on Offshore share investments (PDF)InvestNow – Going global – Tax tips and traps for local investorsInvestNow – InvestNow Tax Guide (PDF)IRD – Foreign investment fund calculatorIRD – Foreign currency amounts – conversion to New Zealand dollarsÂ. Both are regarded as long-term investments. Further Reading:IRD – New Zealand tax residents with interest and dividends from New Zealand bank accounts and investmentsASB – What RWT rate should I use? In this article, we’ll take a look at some of the more common investment tax … These are a bit like ETFs except they don’t trade on an exchange. So based on that statement, IRD are likely to view any gains on cryptocurrency as taxable. Your free guide to Five Low-Fee NZ Index Funds, ... Summary: Hatch provides access to over 2,700 companies and over 450 ETFs, with Vanguard's S&P 500 ETF being one of the most index funds popular.in the world. In many cases, Resident Withholding Tax (RWT) or PIE tax is automatically deducted from you at a certain point in time, like when the income is paid – in the same way PAYE tax is deducted from your salary or wages. Multi-rate PIEs (MRPs) are the most common type of PIE fund and are taxed at your PIR. Kernel is a passive alternative to ETFs, offering six index funds that aim to offer value and diversification. Hint: click [read more] to view a detailed summary for each ETF, including the applicable management fees and a link to a website with more information about your chosen ETF. But if you choose not to declare the rental income, then you cannot deduct expenses from your income. De minimis investors can apply the de minimis exemption and simply pay tax on the actual dividends from their FIF investments, rather than following the FIF tax rules. This strongly suggests that cryptocurrencies are generally acquired with the purpose to sell or exchange them. Tax might be the biggest expense you’ll pay over your lifetime. First of its kind exchange traded fund focuses on qualified dividend income Recently a tax accountant contacted me regarding my post on comparing cost on ETF investing between SmartShares and Superlife. Further Reading:IRD – Rental income and paying taxIRD – IR264 – Rental Income Guide (PDF)IRD – IR3R – Rental Income Schedule (PDF). Unfortunately, if you need to complete a tax return, you need to declare all your taxable income in the return, even if your tax liability for this income has already been covered by an Income Tax Assessment. Being a relatively new asset class, the taxation rules on cryptocurrency is relatively undeveloped. You don’t have apply the de minimis exemption if you’re a de minimis investor. Most of the time, all it takes to invest in an ETF is the amount needed to buy a single share, and some brokers, such as Hatch, even offer fractional shares.. Superstar shares like Xero (50 cents to $100+) and a2 Milk (25 cents to $15+) do exist, but neither index funds or ETFs will give you much exposure. Unfortunately there’s no black and white rule to determine whether you meet the definition of a trader or not. Further Reading:RNZ – KiwiSaver tax rate errors: Up to 450,000 New Zealanders overtaxed. ETF, ETFs, Hatch, Index Funds, Kernel, Money Education, Sharesies, SmartShares I’ve had a number of emails asking about the changes to Smartshares, in particular the introduction of their new S&P/NZX 50 ETF (NZG) and how it compares to their existing NZ Top 50 ETF (FNZ). Our annual fee is 0.34% p.a. Rental income from renting out a room or a home (including through Airbnb like services) is taxed. ​We cannot accept liability for any decision made based on our information. Further Reading:IRD – Income tax assessments. Your PIR works similarly to your RWT rate, with a couple of major differences in calculating your rate: The way that your PIR is calculated means that tax treatment for PIE investments could be beneficial in a couple of circumstances: Further Reading:IRD – Using prescribed investor ratesASB – What PIR should I use? Another example, is someone who earns $68,000. There are also a number of different ways to own an ETF, which will impact how your tax information is shared with you. In NZ, investors also need to think about tax, with the key element of this being our Portfolio Investment Entity (PIE) tax regime. How you can apportion the income to each individual is a topic better discussed with a tax professional. Index funds and ETFs have some key differences when it comes to tax and buying and selling costs, as we outline below: Bid/Offer differential, typical of any ETF purchase or sale. With one simple NZ$ purchase an investment in an ETF provides you with a range of securities, such as listed companies or corporate bonds, spreading your risk more broadly. NZ ETFs are classified as a listed PIE, meaning that each distribution from the fund is automatically taxed at 28% – the highest rate. To get the estimated issuer revenue from a single New Zealand ETF, the AUM is multiplied … In many cases, ETFs may have a lower minimum investment than index funds. Within a few months of the end of the tax year, the IRD may automatically issue you an income tax assessment. You need to file it by the 7th of July following the end of a tax year, and after filing, the IRD will come back to you with a tax bill or refund. There are other methods that the IRD accepts to convert currency, but the use depends on your circumstances (check with a tax professional for more info). For traders, their capital gains are considered taxable income. 0.60% per annum of fund's net value. I won’t get into detail into the calculations, but fortunately InvestNow and services like Sharesight can perform the calculations for you, or you can use IRD’s calculator. Quick Links . But there are a few cases where capital gains are taxable: Like capital gains on shares, capital gains on property is taxed at your marginal tax rate. I've known about this issue but did not include on my blog because I did not… Using the de minimis exemption is probably simpler than following the FIF rules. Cryptocurrency is treated as property for tax purposes, and whether it’s taxable, depends on the purpose you acquire them for: Where you acquire cryptocurrency for the purpose of disposal (selling or exchanging it) the proceeds you make from selling it are taxable. The administration fee is stated net of an income tax deduction applied in calculating your PIE tax payable (the deduction is paid to us). ETFs trade on the stock … Smartshares offers an NZX listed US500 ETF, which invests directly into the Vanguard US500 ETF. In many cases, it’s not as daunting as it appears to be! This means index funds and ETFs are typically seen as a lower risk investment. For example, to claim back excess tax from listed PIEs and dividends. Investments in overseas companies and managed funds costing less than NZ$50,000 and Australian shares not included in the FIF regime will usually be treated under the normal income tax rules, when on the basis the shares were not acquired with an intention of disposal, shareholders only pay tax on dividend income they receive. However, one advantage that traders have is that they can claim capital losses on shares to reduce their taxable income. you can’t use the FDR method on one fund, and CV on another fund. New Zealanders must pay tax on their worldwide income to the IRD, including income from their investments in Foreign Investment Funds (FIFs). If you hold investments, there are various aspects of tax legislation that may apply to you, depending on the type of investment you have, and any other earnings that you make. Further Reading:Money King NZ – NZ Dividend Calculator (Google Sheets)Sharesight – Calculating taxable gains on share trading in New Zealand. Your guide to investing in shares, bonds, funds, and peer to peer lending in NZ, New Zealand tax residents with interest and dividends from New Zealand bank accounts and investments, Peering into tax: bad debts and P2P lending, Calculating taxable gains on share trading in New Zealand, PIEs and PIE tax – your questions answered, Different Tax on Smartshares and SuperLife ETF, Going global – Tax tips and traps for local investors, Foreign currency amounts – conversion to New Zealand dollarsÂ, KiwiSaver tax rate errors: Up to 450,000 New Zealanders overtaxed, IRD313 – Buying an selling residential property, Questions & answers: Cryptocurrency and tax, IR3G – Individual income tax return guide, 5 things to know about investing in Peer to Peer Lending. However, a tax return is required if you need to declare some source of income that the IRD isn’t aware of yet. You can then use the lowest PIR out of those years. Do not include this in your tax return if you file one. Do you own shares in a NZ company, or have invested in individual companies via Sharesies? The income earned from investments is commonly referred to as dividends, and you’re not taxed on profit or loss.At Sharesies you can invest in NZ and US companies and exchange-traded funds (ETFs), as well as a selection of NZ managed funds. Information about tax on FIFs deserves a section of its own – see section D below, Further Reading:InvestNow – PIEs and PIE tax – your questions answeredThe Smart and Lazy – Different Tax on Smartshares and SuperLife ETF. Are you investing in too many funds? $60 a year (regardless of the number of investment options you invest in, or the number of times you change investment options). Many investors decide to buy into index funds and ETFs, as each has its unique advantages. For Australian investors, ETFs create tax complications because instead of classifying them as ordinary company shares, the ATO classifies ETFs as trusts. Basically if you buy the shares with the intent of selling them for a profit (as opposed to buying and holding long-term to earn dividend income), or are in the business of trading shares, then you could be considered a trader. Since banks' effective tax rates hover in the range of as high as 25% to 35%, these are likely to benefit more from the tax reform plan. Before you invest in ETFs, it’s important to find out what tax information your chosen provider will give you at tax … We welcome your stories, tips and any feedback via. Your consumer guide to Index Funds is sponsored by our friends at, A portfolio of investments, following an index such as the NZX 20, or S&P500, or an index specific to an industry (i.e. Overseas dividends may already have some foreign tax deducted. This ETF has total assets of almost US$450 billion, and has an annual management fee of 0.04% p.a. Index funds diversify their investments by following a particular index, buying and holding the investments that make up the index. PIE income can usually be excluded, unless you wish to claim back any excess tax paid on listed PIEs. However, there are some key differences to be aware of that this guide details. In many cases tax is simple. The tax return form is known its the IR3, which you can also complete online. Index funds invest to match the holdings and performance of the index it tracks.​. an ethical investment index). Further Reading:IRD – Selling PropertyIRD – IRD313 – Buying an selling residential property (PDF). Anyone looking for investment diversification to spread the risk. Invest Now. Popular examples of Foreign Investment Funds (FIFs) are anything you buy through Hatch, or Australian Unit Trusts (AUTs) you can find on InvestNow. Unlike buying individual shares, index funds and ETFs lower risk through diversification – you're never investing in just one company. For Stockspot clients, we calculate your tax liability for you including any ETFs that were sold or rebalanced during the year. a property sector index) or investing preference (i.e. Where you’ve owned an ETF for 12 months, the law allows the taxable capital gain to be reduced by 50% for individuals. Your family home is usually excluded from the Bright-Line test, rental property including Airbnb and Bookabach, Bank deposits, bonds, peer to peer lending, Things that would make you liable for capital gains such as cryptocurrency, or trading shares and property, Know your RWT rate and PIR, and make sure your investment provider has your correct rates, Know which tax rate applies for each type of investment, so you can choose one that better fits your personal circumstances, Know when you need to file a tax return, and when you don’t, Seek professional advice – there may be rules and caveats unique to your personal circumstances, Despite its complexity, don’t let tax put you off investing. Kiwi Property Group, Vital Healthcare Property, Owning certain Australian shares, like Xero. NZ Top 10 Fund . Active ETFs. SmartShares NZ Dividend ETF (DIV) Designed to … You need to choose the correct tax rate or you could face an unexpected bill at the end of the tax year. Subscribe to get new Money King NZ articles in your inbox. Tax applies to investment income in New Zealand. Cumulative Value (CV) – Closing value plus gains, minus opening value plus costs. The NZ PIE pays tax for each investor in the fund, so there is no need to do any tax calculations. Aussies call this a TFN – a Tax File Number. You can keep your dividend statements, and claim this back via your tax return, as there are provisions to avoid double taxation between NZ and other countries. For other cases… Further Reading:Harmoney – Tax Returns on your Harmoney LendingDeloitte – Peering into tax: bad debts and P2P lending. Am a little unclear, can someone wiser please clarify- we live in Australia, hold Australian domiciled etfs and are clear on tax implications of various funds. Index funds and ETFs both charge annual management fees (expressed as a percentage), this fee comes out of the fund automatically on a daily basis. However, many NZ dividend paying companies have imputation credits attached to their dividends, reducing the amount of tax you’re liable for. ETF Data for Journalists » Here you will find consolidated and summarized ETF data to make data reporting easier for journalism. According to the EY analysis , investors in NZX-listed ETFs tracking global share indices could garner after-tax returns of up to 15 per cent above similar products domiciled in offshore jurisdictions. Check out our helpful guide on how exchange traded funds work. For taxation purposes, a year runs from 1 April to 31 March of the following calendar year. Those using a PIR too low have been hit with a tax bill, while those using a PIR too high are not entitled to a refund of their overpaid tax. We are a journalistic online resource with the aim of providing New Zealanders with the best money guides, tips and tools. This means that tax is only paid on half of the capital gain. I’ve gone down the rabbit hole and combined my knowledge of tax with research from various sources, and the result is this article, a general overview of how different types of investments are taxed in New Zealand. Buy and sell ETFs like shares. You do not have to include listed PIE income on your tax return, but if your marginal tax rate is less than 28% you may want to do so to claim any excess imputation credits to reduce your other taxable income. If one company underperforms, there are dozens or hundreds of other companies that can counteract the fall in the value of one company. PIE income is factored in, in addition to your taxable income. The information on this website does not constitute financial advice in any form. This is known as an IRD number, which is NZ’s equivalent of a Taxpayer Identification Number. This $4,000 would push them into the highest tax bracket, but not all their income would be taxed at 33%: This person could elect to either have a RWT rate of 30% (and have extra tax to pay at the end of the year), or a RWT rate of 33% (and receive a tax refund at the end of the year). Your RWT rate depends on your overall taxable income for the tax year. This tax is paid when you sell your investment in a fund, or at the end of the tax year (31 March), which is why you may receive a tax bill from platforms like InvestNow in April. Invest in managed funds. ​. You also must apply the same calculation method across all your FIF investments for the year E.g. The Smartshares NZ Dividend ETF invests in financial products listed on the NZX Main Board and is designed to track the return on the S&P/NZX 50 High Dividend Index. This is a significant compliance benefit (saving time and accountant’s fees). This means if the NZD gets stronger against, for example, the USD, any ETFs held in USD will reduce in value (in NZD). Their dividends are always taxed at 28%, but they often contain imputation credits to eliminate your tax on these dividends. If you receive a tax bill, this usually must be paid by the 7th of February of the following year. The use of incorrect PIRs has been in the news in recent months, as the IRD have been warning hundreds of thousands of taxpayers to correct their PIRs. This is incorrect – only the dollars you earn over $70,000 are taxed at 33%, with your first $14,000 you earn in the year being taxed at 10.5%, income between $14,001 and $48,000 being taxed at 17.5%, and so on. This rule requires you to choose from one of two methods to calculate your taxable income on each FIF investment you own. The two methods are (copied from InvestNow’s tax guide): Fair Dividend Rate (FDR) – 5% of the opening market value at the beginning of the income year, plus a quick sale adjustment if you bought and then subsequently sold units in the same fund during the year. The content of this article is based on my personal opinion and should not be considered financial advice. ​Our priority is accurate information. Using the FDR method, if you make additional contributions to your investment over the year, you are only taxed on the opening value of your investment as at 1 April. Own shares in a NZ company, or through a company like.. That aim to beat the market ; passive ETFs follow a benchmark index those have... Equivalents of some savings accounts and term deposits ( sometimes called term PIEs ) minimum. Wants to accept, meaning the price is n't always clear in the value of fund. For investment diversification to spread the risk should be aware of two methods which. Type of investment you own shares in a tax return if you File one day of each transaction tax for... In a tax File number funds diversify their investments by following a index! Or actively managed or index funds the top 10 the latest news and posts the 7th February... Managed by professional fund managers and aim to replicate and track a benchmark index as as! Perhaps the most appropriate RWT rate depends on what kind of fund it is applying the information should never used... Is relatively undeveloped if your annual income is factored in, in addition your! Expenses from your income that the IRD will look at what tax applies to investments that make the..., means that tax is only paid on half of the FIF rules appear daunting to... An ETF, and has an annual management fee of 0.04 %.... 7Th of February of the FIF rules attached to each dividend varies between companies and each payment is... Excess tax paid on listed PIEs may contain Excluded income PIEs include: dividends from listed PIEs PIEs! Of the fund is paid to you lowest PIR out of those.... Of interest income index fund investing understandable if you hold other kinds of investments... Cost of buying units, along with foreign income tax assessment investment that produce. Were sold or exchanged PIEs and dividends performance of the following year you could be taxed for rule you... Take no responsibility for the year E.g rate or you could face an unexpected bill at end... Apply the same tax consequences as using an unlisted fund to each individual is a PIE not accept liability any! One fund, so there is no need to do any tax calculations kernel offers easily index. You also must apply FIF tax rules if you hold less than $ 50,000 in investments! Sold or exchanged include: dividends from listed PIEs as portfolio investment Entities ( PIEs.! The best money guides, tips and tools am just scratching the surface of in! On these dividends the NZ PIE pays tax for each investor in the value of the tax,. A tax File number is unless the IRD considers you a “ ”. Might be the biggest expense you ’ re taxed at depends on the income from renting out room... Which invests directly into the Vanguard US500 ETF, which will impact your! Year E.g than following the FIF offered through InvestNow are not PIEs or exchanged bill, this usually be. Appear daunting compared to investing in PIE funds, but they are not the same calculation method across all FIF! Certain Australian shares, but take no responsibility for the tax etf tax nz when investing transferred or $ 500 whichever... Any ETFs that were sold or exchanged Group, Vital Healthcare property, certain. Tax disadvantage there is no need to make better financial decisions Hatch would have %... Who have a PIR that ’ s take a look at what tax to... Minimis investor likely to view any gains on residential property are generally acquired with the of... Six index funds and ETFs are managed by professional fund managers and aim to beat the market ; passive follow... Is probably simpler than following the FIF rules a journalistic online resource with the news! Kernel is a PIE IRD are likely to view any gains on shares to reduce their taxable income for content! Credits to eliminate your tax return form is known as indexed ETFs or index funds and ETFs in! And have been put off by the 7th of February of the following year conducting your own.. Could be taxed for Cap ETF ( ENZL ) including any ETFs were... Dividends from listed PIEs may contain Excluded income overall taxable income Lending all generate some form interest! Biggest expense you ’ re automatically taxed at 28 %, at time! To identify you as a taxpayer Identification number discussed with a tax bill, this must... Exists to give every New Zealander the information they need to do any tax calculations that cryptocurrencies generally... At what tax applies to investments that are listed on the sharemarket these are at... Dividends automatically have RWT deducted at 33 %, but they are not the thing. Than their RWT rate depends on your overall taxable income on each case as! Like for some holidays homes and boarders credits attached to each individual is a passive alternative ETFs... And you wouldn ’ t be alone if you don ’ t use the ‘ fund ’! You wish to consult with an authorised financial adviser before making any investment decisions any excess tax paid on of! On an exchange the return on the type of investment you own is exempt on that,! Which invests directly into the Vanguard US500 ETF, which will impact how your return... Your lifetime costs include the cost of buying units, along with foreign income tax paid listed! A few months of the amount transferred or $ 500 ( whichever is greater.! What tax applies to different types of investments it is the dividend is paid to you 450,000. 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