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New Zealand law explained for everyone

Income Tax Act 2007

Income - Exempt income

CW 28C: Foreign superannuation withdrawal exceeding given amount

You could also call this:

“Tax rules for large withdrawals from foreign superannuation schemes”

When you take money out of a foreign superannuation scheme during a specific time period, some of that money might be exempt from income tax. This depends on how much you withdraw and which method you use to figure out the taxable amount.

If you use the schedule method, you’ll use a special formula to work out how much of your withdrawal is taxable. Any amount over this calculated figure is exempt from tax.

If you choose the formula method instead, you’ll use a different formula to determine the taxable portion. Again, any amount above what this formula calculates is exempt from tax.

The specific time period for this rule and the formulas you need to use are explained in section CF 3 of the Income Tax Act. This section tells you exactly how to work out your taxable and exempt amounts.

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View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=DLM6034711.

Topics:
Money and consumer rights > Taxes
Money and consumer rights > Savings and retirement
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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”

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CW 29: Reinvested amounts from foreign superannuation schemes in Australia, or

“Tax-free transfer between certain Australian super schemes in the same year”

Part C Income
Exempt income

CW 28CForeign superannuation withdrawal exceeding given amount

  1. A foreign superannuation withdrawal derived by a person in the assessable period referred to in section CF 3(8) (Withdrawals from foreign superannuation scheme) for the person is exempt income of the person to the extent to which the foreign superannuation withdrawal exceeds the amount—

  2. calculated using the formula in section CF 3(10) as the assessable withdrawal amount, if the person uses the schedule method under that section; or
    1. calculated using the formula in section CF 3(16) as the assessable withdrawal amount, if the person uses the formula method under that section.

      Notes
      • Section CW 28C: inserted, on , by section 19 of the Taxation (Annual Rates, Foreign Superannuation, and Remedial Matters) Act 2014 (2014 No 4).