To date, we have encouraged business owners who also receive super, or other source deducted income, to use a higher tax code – usually ST, or SH.
IRD have advised that this is no longer an option. If you only have one source deducted income, then your tax code must be M.
This will make your terminal tax bill higher – by a little bit if we are dealing with the pension, but for anyone else, you may want us to have a look and the consequences. We do have the option of applying for a special tax code, but to be honest, it is easier to just manage your tax payments.
IRD Reviews – overseas income
If you have an overseas pension investment, or you are getting income (including interest on overseas bank accounts), or you are filing an overseas tax return, the chances are that IRD will be wanting to match that up with your NZ tax return information.
You need to declare your worldwide income in your NZ tax return, and if you do not do so, the IRD will get grumpy. It does not matter whether or when you get the money moved back to NZ. What matters is that you received an earning, however small.