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Income Tax Act 2007

Income - Exempt income

CW 28: Pensions

You could also call this:

“How certain pensions and allowances are exempt from income tax”

You don’t have to pay income tax on certain types of pensions and allowances. These include:

  1. Most pensions and allowances under the Veterans’ Support Act 2014, including lump sum payments. However, some payments are not exempt, such as veteran’s pensions, retirement lump sums, weekly income compensation, and some types of weekly compensation.

  2. Pensions or allowances given by any government, in New Zealand or overseas, for war service or disability related to service in the armed forces or police.

  3. Payments of portable New Zealand superannuation.

  4. Payments of portable veteran’s pension.

  5. Overseas pensions, but only in specific situations. An overseas pension is exempt if:

These rules help make sure that people receiving these types of support don’t have to pay income tax on the money they get.

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View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=DLM1513229.

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CW 28B: Foreign superannuation withdrawal in initial period of residency, or

“Tax-free withdrawals from foreign super schemes for new NZ residents”

Part C Income
Exempt income

CW 28Pensions

  1. The following are exempt income:

  2. a pension or allowance under the Veterans’ Support Act 2014, including a lump sum paid pursuant to an election under section 53(1)(b) of that Act, but excluding—
    1. a veteran’s pension:
      1. a retirement lump sum paid under Part 5, subpart 7 of that Act:
        1. weekly income compensation paid under Part 3, subpart 4 of that Act:
          1. weekly compensation paid under Part 4, subpart 5 of that Act:
            1. weekly compensation or aggregated payments, as applicable, paid under schedule 2, part 4, clause 54, 55, 58, or 59 of that Act:
            2. a pension or allowance of any other kind granted in New Zealand or overseas by any government relating to any war or to disability attributable to or aggravated by service in the armed forces or the police:
              1. a payment of portable New Zealand superannuation:
                1. a payment of portable veteran’s pension:
                  1. an overseas pension.

                    1. In this section, overseas pension means—

                    2. an overseas pension, to the extent of amounts deducted under section 189 of the Social Security Act 2018, by the department currently responsible for administering that Act, from—
                      1. a monetary benefit paid under that Act (other than section 380, which relates to reciprocity agreements with other countries); or
                        1. a monetary benefit, other than New Zealand superannuation or a veteran’s pension, paid under section 380 of that Act:
                        2. an overseas pension to the extent to which it is subject to an arrangement under section 190 of the Social Security Act 2018.

                          Compare
                          Notes
                          • Section CW 28(1)(a): replaced (with effect on 7 December 2014), on , by section 12(1) of the Taxation (KiwiSaver HomeStart and Remedial Matters) Act 2015 (2015 No 40).
                          • Section CW 28(1)(a)(iii): inserted, on , by section 12(2) of the Taxation (KiwiSaver HomeStart and Remedial Matters) Act 2015 (2015 No 40).
                          • Section CW 28(1)(a)(iv): inserted, on , by section 12(2) of the Taxation (KiwiSaver HomeStart and Remedial Matters) Act 2015 (2015 No 40).
                          • Section CW 28(1)(a)(v): inserted, on , by section 12(2) of the Taxation (KiwiSaver HomeStart and Remedial Matters) Act 2015 (2015 No 40).
                          • Section CW 28(2): replaced, on , by section 459 of the Social Security Act 2018 (2018 No 32).
                          • Section CW 28 list of defined terms income-tested benefit: repealed, on , by section 15(3) of the Taxation (Livestock Valuation, Assets Expenditure, and Remedial Matters) Act 2013 (2013 No 52).