Beneficial owners recognised in New Zealand
The following types of beneficial owner are recognised for tax purposes in New Zealand:
- Residents of Double Taxation Treaty (DTT) countries;
- Non-residents requesting the Approved Issuer Levy regime;
- Tax-exempt beneficial owners.
- Beneficial owners, residents for tax purposes in New Zealand, or not residents in New Zealand but with a permanent establishment in New Zealand, recognised by the New Zealand Inland Revenue Department (IRD) as having the Resident Withholding Tax (RWT) exempt status (beneficial owners that have applied for RWT exempt status at the New Zealand IRD in order to be added to the Resident withholding tax exemption register and get an IRD number).
New Zealand debt securities may not be held in Clearstream Banking on behalf of beneficial owners that are New Zealand residents for tax purposes, or non-residents in New Zealand but with a permanent establishment in New Zealand, that do not fall under the tax-exempt category as mentioned above. Clients are responsible for ensuring compliance with this restriction.
New Zealand Equities may not be held in Clearstream Banking on behalf of beneficial owners that are New Zealand residents for tax purposes, or non-residents in New Zealand but with a permanent establishment in New Zealand. Clients are responsible for ensuring compliance with this restriction.
Residents of Double Taxation Treaty (DTT) countries
For non-resident beneficial owners that benefit from a Double Taxation Treaty (DTT) between their country of residence and New Zealand, the taxation details vary by type of security, as follows.
- Debt securities covered by the Approved Issuer Levy regime:
Relief at source is available to non-resident beneficial owners that qualify for the benefit of a reduced rate of:
- Levy in accordance with the Approved Issuer Levy regime, as follows:
- 0% on registered government debt securities;
- 0% on qualified corporate debt securities; or
- 2% on registered corporate debt securities;
- Withholding tax in accordance with a DTT between their country of residence and New Zealand.
If we do not receive the request for application of the Approved Issuer Levy regime before our stated deadline, the issue will be considered as a “Standard debt security” and the interest payment will be subject to the standard Non-Resident Withholding Tax (NRWT) rate for on debt securities not covered by the Approved Issuer Levy regime, which is currently 15%.
Quick and standard refunds of the relevant amount of withholding tax are not available through Clearstream Banking if the beneficial owner has not obtained relief at source.
- Standard debt securities (non-Approved Issuer Levy) covered by the Non-Resident Withholding Tax (NRWT) regime:
The standard rate of NRWT on interest from New Zealand standard debt securities is 15%.
Relief at source is available to non-resident beneficial owners that qualify for the benefit of a reduced rate of withholding tax in accordance with a DTT between their country of residence and New Zealand.
Quick and standard refunds for New Zealand bonds under the NRWT regime are available on a case-by-case and “best efforts” basis as no market practice is applicable.
- Kauri bonds:
Clearstream Banking applies 0% withholding tax by default for the above-mentioned securities. No certification or tax instruction is required for non-residents beneficial owners to obtain this exemption.
- Equities:
The standard rate of Non-Resident Withholding Tax (NRWT) on dividends from New Zealand equities is 30%.
Relief at source is available to beneficial owners that qualify for the benefit of a reduced rate of withholding tax in accordance with a DTT between their country of residence and New Zealand.
Quick and standard refunds for New Zealand equities are available on a case-by-case and “best efforts” basis as no market practice is applicable.
Non-residents requesting the Approved Issuer Levy regime
For non-residents of New Zealand requesting the Approved Issuer Levy regime, the taxation details vary by type of security, as follows.
- Debt securities covered by the Approved Issuer Levy regime:
Relief at source is available to non-residents that qualify for the benefit of a reduced levy in accordance with the Approved Issuer Levy regime, as follows:
- 0% on registered government debt securities;
- 0% on qualified corporate debt securities; or
- 2% on registered corporate debt securities.
If we do not receive the request for application of the Approved Issuer Levy regime before our stated deadline, the issue will be considered as a “Standard debt security” and the interest payment will be subject to the standard Non-Resident Withholding Tax (NRWT) rate for on debt securities not covered by the Approved Issuer Levy regime, which is currently 15%.
Quick and standard refunds of the relevant amount of withholding tax are not available through Clearstream Banking if the beneficial owner has not obtained relief at source.
- Standard debt securities (non-Approved Issuer Levy, covered by the Non-Resident Withholding Tax (NRWT) regime):
The standard rate of NRWT on interest from New Zealand standard debt securities is 15%.
Neither relief at source nor standard refund is available to a non-resident requesting the Approved Issuer Levy regime unless such beneficial owner qualifies as a DTT resident.
Quick and standard refunds for New Zealand bonds under the NRWT regime are available on a case-by-case and “best efforts” basis as no market practice is applicable.
- Kauri bonds:
Clearstream Banking applies 0% withholding tax by default for the above-mentioned securities. No certification or tax instruction is required for non-residents beneficial owners to obtain this exemption.
- Equities:
The standard rate of Non-Resident Withholding Tax (NRWT) on dividends from New Zealand equities is 30%.
Quick and standard refunds for New Zealand equities are available on a case-by-case and “best efforts” basis as no market practice is applicable.
Tax-exempt beneficial owners
The taxation details for tax-exempt beneficial owners vary by type of security, as follows.
- Debt securities covered by the Approved Issuer Levy (AIL) regime:
Exemption at source is available beneficial owners that have been granted tax-exempt status by the New Zealand Inland Revenue Department.
Quick and standard refunds of the relevant amount of withholding tax are not available through Clearstream Banking if the beneficial owner has not obtained relief at source.
- Standard debt securities (non-Approved Issuer Levy, covered by the Non-Resident Withholding Tax (NRWT) regime):
The standard rate of NRWT on interest from New Zealand standard debt securities is 15%.
Exemption at source is available beneficial owners that have been granted tax-exempt status by the New Zealand Inland Revenue Department.
Quick and standard refunds for New Zealand bonds under the NRWT regime are available on a case-by-case and “best efforts” basis as no market practice is applicable.
- Kauri bonds:
Clearstream Banking applies 0% withholding tax by default for the above-mentioned securities. No certification or tax instruction is required for non-residents beneficial owners to obtain this exemption.
- Equities:
The standard rate of Non-Resident Withholding Tax (NRWT) on dividends from New Zealand equities is 30%.
Exemption at source is available beneficial owners that have been granted tax-exempt status by the New Zealand Inland Revenue Department.
Quick and standard refunds for New Zealand equities are available on a case-by-case and “best efforts” basis as no market practice is applicable.
Beneficial owners, residents for tax purposes in New Zealand, or not residents in New Zealand but with a permanent establishment in New Zealand, recognised by the New Zealand Inland Revenue Department (IRD) as having the Resident Withholding Tax (RWT) exempt status
- Debt securities covered by the Approved Issuer Levy (AIL) regime:
Exemption at source is available beneficial owners that are recognised by the New Zealand Inland Revenue Department (IRD) as having the Resident Withholding Tax (RWT) exempt status.
Quick and standard refunds of the relevant amount of withholding tax are not available through Clearstream Banking if the beneficial owner has not obtained relief at source.
- Standard debt securities (non-Approved Issuer Levy, covered by the Non-Resident Withholding Tax (NRWT) regime):
The standard rate of NRWT on interest from New Zealand standard debt securities is 15%.
Exemption at source is available beneficial owners that are recognised by the New Zealand Inland Revenue Department (IRD) as having the Resident Withholding Tax (RWT) exempt status.
Quick and standard refund of the relevant amount of withholding tax are not available through Clearstream Banking if the beneficial owner has not obtained relief at source.
- Kauri bonds:
Clearstream Banking applies 0% withholding tax by default for the above-mentioned securities.
Beneficial owners that are recognised by the New Zealand Inland Revenue Department (IRD) as having the Resident Withholding Tax (RWT) exempt status must provide their details including the IRD number to Clearstream Banking in order to be eligible for the 0% rate.