It is well known that if you are a non resident for NZ tax purposes with no NZ sourced income (such as rents) then the tax you pay on any NZ interest income can be as low as 2% Approved Issuer Levy (AIL) if the institution/bank paying the interest has been approved by the IRD.
Now suppose I buy a NZ IP and receive rental income. What is the tax on interest income now?
a) It stays at AIL of 2%
b) It changes to Non resident withholding tax rate of 15% (if my country of residence does not have a Double Tax Agreement with NZ)
c) It changes to Non resident withholding tax rate of 10% if my country of residence has a Double Tax Agreement with NZ
d) nothing cause you shouldn't have money sitting idle in a bank! Invest in an IP now/ pay off that mortgage!
What is the correct answer?
Now suppose I buy a NZ IP and receive rental income. What is the tax on interest income now?
a) It stays at AIL of 2%
b) It changes to Non resident withholding tax rate of 15% (if my country of residence does not have a Double Tax Agreement with NZ)
c) It changes to Non resident withholding tax rate of 10% if my country of residence has a Double Tax Agreement with NZ
d) nothing cause you shouldn't have money sitting idle in a bank! Invest in an IP now/ pay off that mortgage!
What is the correct answer?