IR3NR Question 9 New Zealand interest

Did you receive any New Zealand interest between 1 April 2018 and 31 March 2019:

in cash or by cheque
credited or added to your account
compounded and added to your investment
earned by a partnership, estate or trust, or from Inland Revenue?

You must show all New Zealand interest you receive. Include interest from banks, building and investment societies, credit unions, other securities and any loans you’ve made. Also include interest from Inland Revenue.

Don’t include any interest that has:

had NRWT deducted at the correct rate
been zero-rated under the approved issuer levy rules (AIL). See Approved issuer levy (AIL) for details.

Interest on broken term deposits

If you’ve broken a term deposit during the year, you may have negative interest to account for. This is interest you’ve repaid on the term deposit. It may reduce the amount of interest you need to declare on your return.

If you broke the term deposit in full, or it was business-related, deduct the negative interest from the gross interest amount on your New Zealand NRWT withholding certificate (IR67). Deduct the allowable negative interest component using the worksheet below before entering the gross amount at Question 9B.

What to show in your return

The interest payer will send you a statement or an New Zealand NRWT withholding certificate (IR67). It will show the gross interest paid and the amount of tax deducted.

From each interest statement or certificate, copy the name of the payer, add up the amounts of tax deducted and the gross interest and print the totals in the boxes at Question 9.

Don’t send Inland Revenue your interest statements or certificates, but keep them in case they ask for them later.

RWT

If RWT was deducted from your interest, include it in the RWT column. Tell the organisation paying you interest you’re a non-resident and the country you’re resident in—the payer will then deduct NRWT at the rate for that country.

NRWT payable on your interest

Refer to www.ird.govt.nz (search keywords: NRWT rates) to find the NRWT rate on interest for your country of residence. Multiply that rate by the amount in Box 9B of your return and print your answer in Box 9C.

The credits attached to the gross interest will be offset against the NRWT payable.

Approved issuer levy (AIL)

From 1 August 1991 “approved issuers” (financial institutions) pay interest to non-residents free of NRWT. They have to pay a levy for the right to issue securities subject to a zero rate of NRWT.

The levy, known as approved issuer levy, is calculated at a rate of two cents for every dollar of interest paid for the security.

Don’t include in your return any interest zero-rated under the AIL rules.

Interest of $20 or less

If the total interest you received for the year is $20 or less, you may not receive a certificate or statement, but you still need to show the gross interest and NRWT. Get the details from your bank statements.

More than three certificates

There’s space in the return for details from three interest statements or certificates. If you have more than three, add up all the NRWT and gross interest amounts from all your certificates and print the totals in Boxes 9A and 9B.

Interest on joint accounts

If you hold a joint account, you must show your share of the interest in your return.

Interest paid or charged by Inland Revenue

If Inland Revenue pays you interest, include the interest received in Box 9B for the income year you received the interest.

If you paid Inland Revenue interest, include it as a deduction in the income year the interest is paid.