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Well no sooner do I figure out a way to open an Aussie Account for the divs, but IRD are onto it...
http://www.radionz.co.nz/news/busine...sourced-income
Inland Revenue is warning taxpayers to make sure they declare all income from foreign sources.
The department says it's aware some people may have taxable foreign income held in overseas bank accounts which is accessible in New Zealand.
It says people who conceal such income are cheating other New Zealanders by not contributing their share of tax, and face stiff penalties. PricewaterhouseCoopers chairman John Shewan says it's a timely reminder from IRD. He says people who have offshore bank accounts are taxable as New Zealand residents, not only on the interest income they derive - which may be quite minor - but more also on the foreign exchange fluctuation.
Now I have no problem declaring the interest, but I am still not certain how we are realistically supposed to calculate foreign exchange gains on a transactional account. I guess if they ever audit me, they will be able to demonstrate. Although I suspect John may be over-complicating things for me.
I am taking heart from the fact that the IRD Alert does not appear to refer to tax on foreign exchange gains, but rather on those hiding income/assets altogether.
And here is the brief from IRD as to what tax liabilities are to be considered on a foreign account:
http://www.ird.govt.nz/international...tments/#credit
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Originally Posted by Lizard
Now I have no problem declaring the interest, but I am still not certain how we are realistically supposed to calculate foreign exchange gains on a transactional account. I guess if they ever audit me, they will be able to demonstrate. Although I suspect John may be over-complicating things for me.
John tells it like it is. Forex gains/losses on financial arrangements are taxable on an unrealised basis.
It isn't too difficult if you get a template in excel set up correctly.
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Hi CJ,
Can you provide a link to refer to that outlines the rules around that?
I've spent a good hour or so on the search and best I can find to read is this:
http://newzealandtax.com/index.php?p...l_Arrangements
However, I can't find any reference in there to bringing exchange rate gains or losses to account except under item #20 - which seems to specifically say that they aren't (at least for the typical personal investor).
Any help much appreciated.
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Oops - forgot about 'cash basis persons' which mean it is on a realised basis.
Since Johns comment stated this, read page 11 and 30 for the PwC guide:
http://www.pwc.com/en_NZ/nz/tax-fact...gures-2011.pdf
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Slow progress with getting the Aussie account running... decided to only put one payment to the account and wait to make sure I could access it before adding any others.
So far, have not received the promised cheque book or credit card, nor have I been able to link to my OMCA, as ANZ have not sent a suitable letter showing full account no. and address - the one received so far didn't meet ANZ/National Bank ID standards, as only had the account number. I guess the branch address at the top is not enough to match with the BSB no. I had been verbally given and/or can produce from screenshot? Anyway, all credit to DB for their effort to date, and the ball is in my court to get another letter from ANZ.
It is possible that the letter, cheque book etc have been waiting for money to get into the account - something I could only think how to do by getting a transfer out of the OMCA or wait for a dividend to get paid into it. Managed to get first funds in via dividend on Friday, so will see if that triggers anything this week.
On another front, I received the first dividend statement where a company didn't pay me the dividend because I did not have a bank account - although it is held on my behalf somewhere, so I can still access it by sending them an account. I may actually write to MFG regarding this - they promoted their MFF fund in New Zealand and rights to shares came with the fund. So to not pay a div to those Issuer Sponsored holders in NZ who do not have a bank account seems a bit poor. Possibly they would have sent a cheque if I had written - there was mention of cheques being issued to overseas holders in certain circumstances in the original documents... however, I would think there might be a few NZ holders who bought into the MFF float who would own only a small amount of MFG shares as a result and who might not find the stamp or costs of opening an Aussie bank account to be worth the dividend.
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Sounds like no one wants your riches eh Lizard
Keep persevering and good luck
Makes me feel lucky retaining an Aussie account I opened zonks ago when i was over there ... prob not kosher now under all the current rules and regulations but it still lets me put money in and take it out
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Well, just to keep updating the saga and next chapter in the book of "what it takes to be a DIY investor in the modern age"...
... rang Australia today to find out why no cheque book, card or letter yet and was advised that my account had not been activated yet as had yet to complete the "100 points identification" (whatever that means). I explained that I had completed a form and provided two forms of ID as required and that these had been provided by the ANZ advisor in New Zealand in early October. They said I needed to visit the branch again and complete the "100 points identification". I asked if they could explain what that meant, since my NZ advisor must have done it incorrectly, but they said they could not tell what had been done wrong and we agreed that I would visit the branch.
On reflection (given I'd be unlikely to complete this in under an hour), I decided to try ringing the branch instead. Stupidly, I had not written down the name and number of the advisor I'd spoken to - you would think I would have learned by now - so it was back to the 0800 line. After getting put through to the branch and then describing the advisor and some discussion over hair colour/style (am sure my husband would have failed this test), I finally got hold of the advisor who (yay!) remembered me. She said she had faxed the documents as per the instructions on the intranet and would re-fax. I asked her to ring Australia first and check if there were any further requirements.
Apparently she did, as I later received a message that they had suggested she post the documents and that they also be scanned and e-mailed, so she had done that and now has her fingers crossed for good measure. I guess that will require the standard box of chocolates (or has New Zealand society progressed to $20 notes slipped between application forms and I've missed it?). Anyway, fingers crossed that the verification will be sorted and, as the advisor noted in her message "these things are not always plain sailing".
Meanwhile, my e-mail to MFG advising them of the difficulty for New Zealand investors in requiring them to have an Australian Bank account in order to receive dividends has gone unanswered. Strike two.
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I don't know how you do it.!!!!!
I tried to redeem some fly buy points on line tonight.Couldn't remember password,then they said I got my date of birth wrong.!!!! Yeah Right.!!!
If you manage it I will give you an impossible challenge.Try it with Westpac!!!!!
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Member
For your edification!
http://www.australianaustralia.com/p..._Australia/190
So there you have it. Quite a process, even in person in a Darwin branch of National Australia Bank in August. We were there for over an hour! Never has opening a bank account taken so long.
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