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However, my evidence on what happens with supplementary tax payments comes from p29 in the IR274 booklet (dated July 2022), as put out by the NZ IRD. There is a referred to table, which shows how 'Foreign Investor Tax Credits' ('FITC') get woven into declared income by a New Zealand company. The table reads as below.
New Zealand company's profit before tax |
$100.00 |
Less income tax at company tax rate (28%) |
$28.00 |
Equals Company's after tax profit |
$72.00 |
Add back FITC claimed by company |
$12.17 |
Amount available for non-residents dividend |
$72.00 |
Share of profits paid to non-resident shareholder |
$84.71 |
less Non resident withholding tax deducted at 15% |
$12.17 |
equals Net dividend paid to non-resident shareholder |
$72.00 |
This table aligns with what I previously said about the supplementary tax credit payment to foreign shareholders of NZX tax paying listed companies being exactly wiped out by an equivalent withholding tax deducted.
Thus the cash deposited in the shareholder bank account is the same amount of money, whether you be a New Zealand resident or a foreign shareholder. As I said before, I am happy to be proved wrong if a foreign person in this situation is treated differently. But I can only go on what the IRD is telling me
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