Skip to main content

Portfolio Investment Entity Guide - IR860

This guide explains the tax rules relating to portfolio investment entity.

Since 1 October 2007, eligible entities can become portfolio investment entities (PIEs), which aren’t taxed on gains on shares in New Zealand and certain Australian companies. The aim is to encourage savings by lower and middle income earners who have been reluctant to save through collective investment vehicles (such as a managed fund).

PIEs generally pay tax on investment income based on the tax rates of their investors, rather than at a flat rate. Most PIEs fall into the multi-rate PIE (MRP) category, unless otherwise specified.

IRD Voluntary Disclosure Helo

The requirements to calculate tax vary depending on the type of MRP. Attribution and calculation periods determine the periods over which income (and deductions, losses and tax credits) are attributed and tax is calculated. An entity chooses an attribution and a calculation period at the time it elects to become an MRP or the start of the tax year.

Quarterly and exit MRPs can use tax credits to reduce their tax for investors other than investors that have had the zero rate applied, and to get a refund of income tax to the extent of the unused New Zealand tax credits. Investors can’t get a refund of foreign tax credits.

Guide to portfolio investment entity guide (IR 860)

IR 860

Please note the guide(s)/form(s) were the latest version at the time this web page was finalised. If you need the latest form/guide, please visit IRD’s website at here.

Need help?

Please refer to our people for more information on who we are, our experience and how we can help.

We offer a no obligation free consultation where we can discuss:

  • Your current tax situation and position
  • Highlight tax issues and opportunities
  • How we can add value and assist
Book a Consultation