Trans-Tasman Taxation

Who this is really for

Few people open with the word residency. They say something closer to one of these.

• "We moved to Brisbane two years ago and the house in Tauranga is still rented out. I file something with IRD every year and I'm not sure the Australian return knows about it."
• "My employer is in Auckland. I work from home here and they still pay me in New Zealand dollars."
• "I've got about ten years of KiwiSaver sitting there. Should I bring it across, and what happens if I do?"
• "We're going home to New Zealand next year. What happens to our super, our shares and the unit we own here?"
• "Inland Revenue and the ATO both seem to think I'm theirs."

What follows is general information, not advice for your situation. The order matters: residency first, then everything else.

What we actually do

Settle residency before anything else

Australia and New Zealand each decide residency under their own law. Australia applies four tests: whether you reside here in the ordinary sense, whether your domicile is here, whether you were present for more than half the income year, and a test for certain Commonwealth super members. The resides test weighs where you live, work, keep your family and assets, and what you intend.

New Zealand makes you resident once you have been there more than 183 days in any 12-month period, backdated to the first of those days, or once you have a permanent place of abode there, whichever comes first. To stop being resident you need both: no permanent place of abode in New Zealand and more than 325 days away in a 12-month period. The place does not have to sit empty, so a home rented to tenants while you are away can still keep you resident.

You can be resident in both countries at once. The Australia–New Zealand tax treaty then breaks the tie in a fixed order: where you have a permanent home available, then where your personal and economic relations are closer, then where you have a habitual abode, then nationality. We work through those facts with you, date the change and write the position down, because both returns are built on it.

New Zealand citizens and the temporary resident rule

Most New Zealanders here hold a Special Category visa, which is a temporary visa. If you hold one, and neither you nor your spouse is an Australian citizen, a permanent resident or a protected Special Category visa holder, the ATO treats you as a temporary resident. You can be an Australian resident for tax and a temporary resident at the same time. A temporary resident declares Australian-sourced income, gains on taxable Australian property and, in some cases, pay for work done overseas while a temporary resident. Other foreign income, such as New Zealand rent or interest, generally stays out.

That status ends the day you or your spouse becomes an Australian citizen or permanent resident. From then your worldwide income is taxable here, and your assets outside Australia are treated as acquired at their market value on that date. If citizenship is on the way, get valuations of New Zealand property and shares as at that day. They set the Australian capital gain when you sell.

Income from the other side, and the offset

Once you are taxed here on worldwide income, New Zealand income goes into your Australian return converted to Australian dollars, and you claim a foreign income tax offset for New Zealand tax you have actually paid on it. If the offset is $1,000 or less you just record the amount. Above that, you have to work out an offset limit, and the claim cannot exceed it.

Timing trips people up. New Zealand's tax year runs 1 April to 31 March and Australia's runs 1 July to 30 June, so New Zealand figures are apportioned across two Australian years. The offset can only be claimed once the New Zealand tax is paid. If that happens after your Australian return is lodged, you have four years from the payment date to ask for an amendment, and we keep track of that for you.

New Zealand rental property

A New Zealand rental means a return in each country. As a non-resident of New Zealand you need an IRD number and you file a non-resident return, the IR3NR, for the rent. New Zealand ring-fences residential rental losses: excess deductions cannot reduce your other income and are carried forward against future rent from the property. Interest on the loan has been fully deductible again since 1 April 2025. If you sell a residential property within two years under the bright-line test (for sales from 1 July 2024), the profit is taxable unless an exclusion applies, and residential land withholding tax may come out of the sale proceeds.

The same rent then appears in your Australian return if you are taxed here on worldwide income, calculated under Australian rules, with the offset for the New Zealand tax. The two figures rarely match, and they are not supposed to. We prepare both sides from the same records so the differences can be explained line by line. There is more in keeping your NZ rental after moving to Australia.

KiwiSaver and Australian super

Under the Trans-Tasman Retirement Savings Portability scheme you can move retirement savings across once you have moved permanently. The whole balance has to go, not part of it. KiwiSaver money can only go into an APRA-regulated fund, never a self-managed fund. The transfer itself is not taxed. Inside an Australian fund your savings are held in two parts: the Australian-sourced part is generally available from 60 once you retire, and the New Zealand-sourced part not until New Zealand's retirement age, currently 65.

The step that needs checking first is the cap. New Zealand-sourced savings arriving in Australia count as non-concessional contributions, so a large balance can exceed the cap and trigger excess contributions tax. We check your cap room and total super balance before the forms are signed. Going the other way, Australian super moved into KiwiSaver cannot be used for a first home or moved on to a third country. Moving to Australia also does not let you cash out KiwiSaver: Inland Revenue allows that withdrawal after a year away only if you have moved somewhere other than Australia. Our article on KiwiSaver and Australian super goes through the decision.

Working for a New Zealand employer from Australia

Under the treaty, salary is taxed in the country where you live unless the work is physically done in the other country. If you are an Australian resident working from a desk in Queensland for a company in Wellington, the work is done here and the salary is taxed here, even though it is paid from New Zealand in New Zealand dollars.

Where the employer is still deducting New Zealand PAYE as though you never left, that is worth fixing with the employer and Inland Revenue early rather than hoping an offset sorts it out at year end. And if no Australian tax is being withheld from your pay, the whole year's tax falls due when your return is assessed. We work out what to put aside.

Moving in either direction

Coming to Australia, the year you arrive is a part-year: your tax-free threshold is reduced, and if you become a resident who is not a temporary resident, your overseas assets take a market-value cost base from that day. Meanwhile New Zealand may still treat you as resident until the permanent place of abode and 325-day tests are both behind you. Moving from New Zealand to Brisbane sets out the first year.

Leaving Australia, you are treated as having sold your assets other than taxable Australian property, such as shares, at market value on the day you stop being resident. If you are still a temporary resident when you leave, that deemed sale does not happen. Otherwise you can choose to disregard those gains and losses, and the assets stay inside the Australian net until you sell them or come back. An Australian rental you keep stays taxable here, with the capital gains discount reduced for the years you were a foreign resident. From 1 July 2027 the discount is replaced by indexation and a 30% minimum tax for gains that accrue after that date, so a later sale is worked out under both sets of rules. If you sell your former home while a foreign resident at the time of the contract, the main residence exemption is generally not available. A HELP debt follows you too: you report worldwide income each year or lodge a non-lodgment advice.

On the New Zealand side, a migrant or a New Zealander returning after ten or more years away can be a transitional resident, with most overseas income such as interest, dividends and rent exempt for about four years. Employment income is not covered. The exemption ends early if that income goes into an IR3 or you claim Working for Families, and you only get it once. See leaving Australia for New Zealand before you book the flights.

How it works

How fees work for this service

The fee is fixed and agreed before we start. What moves it is the work involved: whether this is the year you moved, which means residency has to be settled from scratch, or a settled year with the same pattern as last time; how many properties there are and in which country; whether there is a New Zealand return to deal with; and whether a KiwiSaver or super transfer needs checking against the contribution caps.

If something new turns up partway through, such as a sale, we tell you before doing extra work. How our fees work explains the approach across all services.