Resident Withholding Tax (RWT)‚Äč

Resident Withholding Tax (RWT)


 
Resident Withholding Tax is tax deducted on the payment of dividends and interest.  The tax is deducted on the payment date and not the date the interest was earned.  If the recipient of interest has a certificate of exemption, then no withholding tax need be deducted.

The withholding tax required to be deducted on the payment of dividends to New Zealand resident shareholders is 33%, less any imputation credits attached to the dividends.  The withholding tax required to be deducted from interest is based on the rate chosen by the recipient, provided the recipient has provided an IRD number.


Individuals, Trusts & Maori Authorities 

The rates from 1 April 2012 are:

If the investor has ... And is ... AThen Deduct RWT At ... 
Chosen a rate
An individual, a testamentary trust, or  trust
10.5%, 17.5%, 30% or 33%
Chosen a rate
A trust or a Maori authority
17.5%, 30% or 33%
Not chosen a rate for an existing account   The default rate of 17.5%
Not chosen a rate for a new account
  The default rate of 33%
Not provided a valid IRD number   The no-notification rate of 33%


Companies

The rates from 1 April 2012 are:

 If the Investor has ... and they are ...   Then Deduct RWT At ... 
Chosen a rate Using a valid IRD number 28% or 33% 
Not chosen a rate
Using a valid IRD number
 The default rate of 28%
Either provided an invalid,
or no IRD number
   The no-notification rate of 33%


Partnerships


if the partnership's IRD number is given to the interest  payer. you may choose any of the rates that would apply as if the account were held in a partner's name.

Back to Tax Facts