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Income Tax Act 2007

Income - Employee or contractor income

CE 1F: Treatment of amounts derived by cross-border employees

You could also call this:

"Tax rules for people who work in New Zealand for an overseas employer"

Illustration for Income Tax Act 2007

You work for an employer in another country, but you do some work in New Zealand. Your employer pays you, and this payment might include money for work you did in New Zealand after you left. When your employer tells the government about your income under section 23J(3) of the Tax Administration Act 1994, your income is considered earned 20 days later. You might not have tax taken out of your pay, or not enough tax might be taken out, as described in section RD 21, RD 62B, or RD 71B. In this case, you have to do what your employer would normally do with tax. You can pay the tax you owe all at once. A cross-border employee is someone who works for an employer in another country, or a New Zealand employee who works overseas. This includes people who work for someone who is not from New Zealand, or people who are sent to work for another company. You can find more information about this in section 120B and section 141ED of the Tax Administration Act 1994.

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View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=LMS849878.

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Part CIncome
Employee or contractor income

CE 1FTreatment of amounts derived by cross-border employees

  1. This section applies in certain circumstances when an employer pays a PAYE income payment to a cross-border employee who provides services in New Zealand. For this purpose, the payment may include an amount paid to the person after they have left New Zealand that is a payment for services provided by the person while they were in New Zealand.

  2. When the employee remains on the employer’s payroll system in a country or territory outside New Zealand, the PAYE income payment is treated as derived by them on the 20th day after payment when the employer chooses to deliver their employment income information under section 23J(3) of the Tax Administration Act 1994.

  3. When an amount of tax is not withheld or when payment is insufficient as described in section RD 21, RD 62B, or RD 71B, as applicable, and the employee must undertake the relevant tax obligations in relation to employment, they must do so as if an employer, and, for this purpose, may pay the initial amount of tax for the payment as a lump sum.

  4. For the purposes of this section and sections CE 1(3B), RA 15(4B), RD 62B, RD 65, and RD 71B, and sections 23IB, 120B, and 141ED of the Tax Administration Act 1994, a cross-border employee—

  5. means—
    1. for a person providing a service in New Zealand, an employee of a non-resident employer:
      1. for a person providing a service outside New Zealand, a resident employee; and
      2. includes a secondee or a person who provides a service for or on behalf of a person who is not resident in New Zealand.

        Notes
        • Section CE 1F: inserted, on , by section 17 of the Taxation (Annual Rates for 2022–23, Platform Economy, and Remedial Matters) Act 2023 (2023 No 5).