When opening an account with Kernel, in addition to an IRD number, you need to provide three pieces of tax information:
- Prescribed Investor Rate
- Resident Withholding Tax rate
- Tax residency information
Prescribed Investor Rate (PIR)
Your PIR is the tax rate applied to income earned from investment in a Portfolio Investment Entity (PIE) fund. You need to make sure your PIR is correct at all times. The default PIR is 28% unless you have elected a lower rate.
Resident Withholding Tax (RWT)
RWT may be deducted from interest earned on money outside of the funds. It is automatically deducted when interest is paid..
Tax residency information
New Zealand is part of a global initiative called the Automatic Exchange of Information (AEOI), which is aimed at preventing offshore tax evasion.
Kernel is legally required to collect, report, and exchange foreign tax and financial information about your account to the IRD. When opening an account you will be required to confirm if you are a tax resident of any other country, and provide the relevant tax identification number(s). You must advise us of any changes in your eligibility or tax status.
We are required by New Zealand law to pass on the tax information you supply, in addition to financial information about your account, to the IRD if you are a foreign tax resident. The IRD may share this information with your home country or jurisdiction, if New Zealand has an AEOI exchange relationship with them.
You can find out more information about and the Common Reporting Standard (CRS) and AEOI on the IRD website.
If you have any questions on tax please contact us.