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New Zealand: Tax measures in 2026 budget

Changes to foreign investment tax rules, financial arrangement rules, and R&D tax credit 

May 29, 2026

The New Zealand 2026 budget introduces various tax proposals, including:

  • Foreign investment tax reforms, such as doubling the de minimis threshold (from NZ$50,000 to NZ$100,000) before investors become subject to the complex foreign investment fund (FIF) regime and making the realization basis taxation approach for unlisted foreign shares available to all New Zealand taxpayers
  • Changes to financial arrangement rules, including exclusions for certain low-risk financial arrangements (e.g., residential mortgages) and unrealized foreign exchange movements
  • Research and development (R&D) tax credit changes, including significant decrease in the cap on non-administrative internal software development spend (from NZ$25 million to NZ$3 million) and introduction of the in-year tax credit process, as well as other compliance simplifications.

Read a May 2026 report prepared by the KPMG member firm in New Zealand

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