PIE Fund vs FIF Calculator NZ

Compare the estimated annual tax and fund fees of a New Zealand PIE fund with a direct foreign investment under the FIF rules.

Adjust your plan

Move the sliders or enter exact amounts.

Your investment

Values shared across both sides of the comparison.

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$

PIE fund

Choose the tax rate and fee charged inside the PIE fund.

PIE prescribed investor rate
%

Direct foreign investment

Choose the return, personal tax rate, and direct fund fee.

%
Marginal income tax rate
%

Your estimate

Updates instantly as your numbers change.

Estimated annual difference

$220

The direct foreign investment costs $220 less under these assumptions.

PIE fund

Annual cost

$1,900

$1,400 estimated tax plus $500 in fund fees.

Direct foreign investment

Annual cost

$1,680

$1,650 estimated tax plus $30 in fund fees.

FIF rules apply in this estimate. Direct taxable income is 5.0% of the opening balance, using the lower of the 5% fair dividend rate and the entered nonnegative total return.

How this calculator works

This calculator compares one year of estimated tax and fund fees for foreign share exposure. It applies the standard 5 percent fair dividend rate to the PIE. For an eligible individual using a direct foreign investment, it uses the lower of 5 percent or a nonnegative total return when the FIF rules apply. At or below the threshold, it assumes the exemption is used and taxes dividends instead.

Important assumptions

  • The PIE is a multi rate PIE holding foreign shares that uses the fair dividend rate method.
  • The direct investor is an eligible New Zealand resident individual who can use the fair dividend rate or comparative value method.
  • The $50,000 threshold uses the total purchase cost of all FIF interests that are not exempt and are held at any time in the year.
  • Foreign tax credits, deductible expenses, quick sale adjustments, trading costs, currency movements, and adviser or accounting costs are not included.

These results are general illustrations only and are not financial advice. Actual outcomes can differ.

Sources: Inland Revenue guidance on foreign investment funds, Inland Revenue guidance on PIE income for New Zealand residents, Inland Revenue guidance on individual tax rates.

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Common questions

Terms explained

  • FIF rules

    The foreign investment fund (FIF) rules tax New Zealand residents on overseas shares and funds once their total cost goes over $50,000.

  • Fair dividend rate

    The fair dividend rate method treats 5% of the opening market value of your offshore investments as taxable income each year.

  • PIE fund

    A portfolio investment entity (PIE) is a New Zealand fund taxed at each investor's prescribed investor rate, capped at 28%.

  • PIR

    Your prescribed investor rate (PIR) is the tax rate on your PIE and KiwiSaver earnings: 10.5%, 17.5% or 28% for New Zealand residents.

  • Marginal tax rate

    Your marginal tax rate is the rate of income tax you pay on your next dollar of income.

  • ETF

    An exchange traded fund (ETF) is a fund you buy and sell on a stock exchange, usually tracking an index.

See the full glossary