Your Prescribed Investor Rate (PIR) is the tax rate which is applied to any income earned from investment in a Portfolio Investment Entity (PIE) fund.
It’s based on the total taxable income you earnt in New Zealand in the last two tax years (that’s years to 31 March) and you can choose the lower annual amount. For most resident Kiwis who earn over $48,000 - your PIR will be 28%.
Here’s a flow chat to help figure our your PIR:
The difference between taxable income and total income is any income earnt from PIE investments.
You would need to earn $22,000 a year in income, which generally requires a fund portfolio more than $500,000 for this to be the difference. The default PIR is 28% unless you have elected a lower rate, and it’s up to you to make sure your PIR is correct.
To change the PIR linked to your Kernel funds, contact us by email at email@example.com.
For more information about PIR—check out the IRD website.