McGregor Bailey Blog

Getting Your PIE Tax Right

If you're investing in a PIE, be sure to get the right tax rate (Prescribed Investor Rate/PIR).  You should check with us when we do your tax return each year as it can change from year to year and there are no refunds of overpaid tax.

If your income is less than $48,000, use a rate of 17.5% unless you have so much PIE income that it exceeds $22,000. If husband and wife have PIE income in their joint names but their taxable incomes are taxed at different rates, it's better to split the PIE investment into two halves and invest separately, so one can be taxed at the lower rate. Otherwise, the whole of the investment has to be taxed at the rate applying to the higher taxpayer.

It is important to get your PIR correct on your PIE investments so contact us if you would like us to review your tax position and advise on the rate you should be using.

IRD Numbers for Property Sales

All vendors and purchasers of property other than their main home must now provide an IRD number as part of the land transfer process.


Offshore buyers must provide a New Zealand bank account number before they can obtain a New Zealand IRD number. And all non-resident buyers and sellers must provide their tax identification number from their home country, along with current identification requirements such as a passport.

Family trusts

Where a family's main home is owned by the family trust, the trust is not exempt from providing an IRD number.

It's quite common for a trust to own the family home, protecting the family from business or other relationship property risks. Up till now family trusts haven't needed IRD numbers unless they operated a business or owned rental properties. Now, when the family home is transferred into the trust or when the trust buys or sells property, the trust needs an IRD number. Trustees' own personal IRD numbers aren't acceptable.

The new requirements also affect changes of title. So, if a trustee dies or retires and the new trustee's name needs to be registered on the property title, the trust needs an IRD number to register the change.

If you are arranging for the family trust to buy, sell or transfer property, please contact us. If the trust does not already have an IRD number we can take care of this. Otherwise you could face costly and stressful delays while you sort out the paperwork.

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