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IR6 Question 10 New Zealand dividends

Dividends are the part of a company’s profits that it passes on to its shareholders. Unit trusts are treated as companies for income tax purposes. Distributions from unit trusts will generally be taxable and are treated as dividends.

All the trust’s cash and taxable bonus issue dividends derived from a qualifying company must be distributed by the trustees as beneficiary income to the beneficiaries who are not trustees or companies that are not qualifying companies.

Complete Question 10 if you received any New Zealand dividends, including dividends from your local electricity or gas supplier. Don’t include a dividend that’s a distribution of the trust’s capital and is tax free. The company or unit trust that paid you the dividend will send you a dividend statement.

Don’t send any dividend statements with the return, but keep them in case Inland Revenue ask for them later.

If expenses are deductible against the dividend income, claim them at Question 19.

Credits attached to dividends

“Imputation credits” are credits for part of the tax the company has already paid on its profits, which means the dividends aren’t taxed twice.

RWT is deducted from your dividend to bring the total credits withheld up to 33% of the gross dividend.

What to show in your return

Your dividend statements show the amount:

  • you received (net dividend)

  • of any imputation credits

  • of any RWT credits.

Add all these amounts together to work out your total gross dividends and enter this in Box 10B.

Add up all the imputation credits and print the total in Box 10. Add any dividend RWT credits and print the total in Box 10A.

Shares instead of dividends

If the trust received shares instead of dividends, include them as income at Question 10B. Write the amount as if you received dividends instead of shares.

Dividends from overseas

Please read about overseas income at IR6 Question 13 Overseas income in this guide.

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