Banking, Money and Taxes in New Zealand

New Zealand's banking system offers expats a sophisticated and comprehensive range of services, as well as high-quality customer service. Opening a bank account in New Zealand is generally straightforward for expats, who typically need only a bank reference from their home country.

Visa and MasterCard are accepted everywhere. There are many ATMs that can be used to draw both local and foreign funds with a debit or credit card.

Money in New Zealand

The currency in New Zealand is the New Zealand Dollar (NZD), which is divided into 100 cents. In New Zealand, it is normally written with a dollar sign, or as NZ$ to distinguish it from other dollar currencies. A dollar in New Zealand is sometimes informally referred to by residents as a Kiwi.

• Notes: 5 NZD, 10 NZD, 20 NZD, 50 NZD and 100 NZD

• Coins: 10 cents, 20 cents, 50 cents, 1 NZD and 2 NZD

Banking in New Zealand

Banking in New Zealand is relatively uncomplicated. The largest banks in New Zealand are ANZ, Bank of New Zealand (BNZ), ASB and Westpac.

All banks have online banking services that allow account holders to transfer funds or pay certain municipal bills and other services online. Banks usually issue holders with a card that can be used to pay bills at electronic points of sale at shops and restaurants, such as a Visa debit card. Cashless and contactless services are highly popular throughout New Zealand.

Opening a bank account

It is advisable for expats to investigate their banking options before they commit to a certain account type or bank. Some banks or bank accounts charge fees for certain services – such as for transactions or monthly statements – while others don’t. Generally, expats will be offered a choice between a current and a savings account or a package that includes both.

The requirements for opening a bank account in New Zealand vary depending on the bank. In general, foreign applicants will need identification (often in the form of a passport and a driving licence), proof of residence and their visa. Conveniently, the account can be set up and a new bank card will be issued on the same day. 

Some banks, such as the Bank of New Zealand, allow customers to apply online before they have even arrived in New Zealand. Therefore, expats who meet certain criteria can deposit money into their account before moving to New Zealand. However, they would need to go into a branch when they arrive to get a bank card that allows them to access their funds.

Credit cards and ATMs

ATMs are widely available in New Zealand and Visa and MasterCard are accepted everywhere. When expats open a bank account, they are typically given an EFTPOS card that functions like a debit card and can be used to make purchases by swiping and entering a PIN. While EFTPOS cards are free of charge for the user, they are only usable in New Zealand or Australia and can't be used for online payments. Expats should be aware of this when choosing to open an account with an EFTPOS card.

Taxes in New Zealand

New Zealand has simple tax laws with minimal loopholes. It is one of the most favourable tax environments for investors of all OECD countries.

Local income tax is calculated on a progressive scale depending on how much one earns and is capped at 39 percent. Expats who are in New Zealand for less than 183 days of any 12-month period are only liable for tax on their locally earned income. On the other hand, expats who live in New Zealand for 183 days or more in any 12-month period are considered tax residents. This means that they will be liable to pay tax on their worldwide income.

New Zealand's tax system is favourable for investors, with no capital gains, inheritance, estate or healthcare taxes aside from property rates. That said, it's also important to note that New Zealand has an expanded concept of income compared to many other countries, and these other taxes are generally wrapped into income tax. There is also a blanket Goods and Services Tax (GST) of 15 percent factored into most things that expats buy in New Zealand. Additional taxes are also paid on alcohol, tobacco and petrol.