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Income Tax Act 2007

General collection rules - Withholding tax on non-resident passive income (NRWT)

RF 1: NRWT rules and their application

You could also call this:

“How non-resident withholding tax rules work and when they apply”

The NRWT rules are a set of laws that deal with non-resident withholding tax. These rules are made up of different parts of the tax law. They include this part of the law, as well as other sections that talk about things like tax credits and how to treat certain types of income.

These rules apply to you if you make a payment that is considered non-resident passive income. This means income that goes to someone who doesn’t live in New Zealand.

There are some special cases where these rules don’t apply. For example, they don’t apply to some types of income from land that are covered by a different part of the law.

However, the rules do apply to money paid for using or taking things that grow on the land or come from the land naturally. This includes plants, minerals, or other materials.

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View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=DLM1520309.

Topics:
Money and consumer rights > Taxes
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“Groups without official status can be exempt from resident withholding tax in certain situations”

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RF 2: Non-resident passive income, or

“Income from NZ sources for non-residents, including dividends, royalties, and interest”

Part R General collection rules
Withholding tax on non-resident passive income (NRWT)

RF 1NRWT rules and their application

  1. The NRWT rules means—

  2. this subpart; and
    1. subpart FG (Treatment of notional loans to New Zealand branches of foreign banks); and
      1. section LB 5 (Tax credits for non-resident withholding tax); and
        1. sections LJ 1 to LJ 3, LJ 6, and LJ 7 (which relate to tax credits for foreign income tax); and
          1. sections LK 1 to LK 5, and LK 7 (which relate to tax credits related to attributed CFC income); and
            1. section RZ 13 (Treatment of prepayments); and
              1. section YD 5(1)(d), and (4) to (9) (Apportionment of income derived partly in New Zealand); and
                1. sections 32M, 49, 100, Part 9, and sections 165B and 185 of the Tax Administration Act 1994.

                  1. The NRWT rules apply to a person who makes a payment that consists of non-resident passive income.

                  2. This section does not apply to an amount referred to in section CC 1(2)(a) to (d) (Land) to which section CC 9 (Royalties) applies.

                  3. Despite subsection (3), this section does apply to non-resident passive income that is an amount paid for—

                  4. the exploitation of, or right to exploit, plant material or a naturally occurring material or mineral arising in or on the land:
                    1. the removal of, or right to remove, plant material or a naturally occurring material or mineral arising in or on the land.

                      Compare
                      • 2004 No 35 s OB 1 NRWT rules
                      Notes
                      • Section RF 1(1)(ab): inserted, on , by section 272(1) (and see section 5) of the Taxation (Annual Rates for 2016–17, Closely Held Companies, and Remedial Matters) Act 2017 (2017 No 14).
                      • Section RF 1(1)(db): inserted, on , by section 272(2) (and see section 5) of the Taxation (Annual Rates for 2016–17, Closely Held Companies, and Remedial Matters) Act 2017 (2017 No 14).
                      • Section RF 1(1)(dc): inserted, on , by section 272(2) (and see section 5) of the Taxation (Annual Rates for 2016–17, Closely Held Companies, and Remedial Matters) Act 2017 (2017 No 14).
                      • Section RF 1(3) heading: added (with effect on 1 April 2008), on , by section 111(1) of the Taxation (Consequential Rate Alignment and Remedial Matters) Act 2009 (2009 No 63).
                      • Section RF 1(3): added (with effect on 1 April 2008), on , by section 111(1) of the Taxation (Consequential Rate Alignment and Remedial Matters) Act 2009 (2009 No 63).
                      • Section RF 1(4) heading: added (with effect on 1 April 2008), on , by section 111(1) of the Taxation (Consequential Rate Alignment and Remedial Matters) Act 2009 (2009 No 63).
                      • Section RF 1(4): added (with effect on 1 April 2008), on , by section 111(1) of the Taxation (Consequential Rate Alignment and Remedial Matters) Act 2009 (2009 No 63).
                      • Section RF 1 list of defined terms amount: inserted (with effect on 1 April 2008), on , by section 126 of the Taxation (Consequential Rate Alignment and Remedial Matters) Act 2009 (2009 No 63).