PIR
Prescribed Investor Rate (PIR)
The tax rate applied to your share of a PIE fund's taxable income. NZ has three PIRs: 10.5%, 17.5% and 28%. The maximum is 28%.
The Prescribed Investor Rate (PIR) is the tax rate that applies to your share of a Portfolio Investment Entity (PIE) fund's taxable income. NZ resident individuals have three PIR options: 10.5%, 17.5% and 28%.
Your correct PIR depends on your taxable income and PIE income across the most recent two income years. As a rough guide: total income up to NZ$14,000 → 10.5% PIR; up to NZ$48,000 → 17.5% PIR; above NZ$48,000 → 28% PIR. The exact thresholds depend on a combined-income calculation that includes PIE income; check IRD guidance.
Most fund providers ask for your PIR when you open an account and let you change it on request. Using too high a PIR overpays tax (refundable from 1 April 2020 onward); using too low a PIR underpays and the shortfall is collected at year-end via an end-of-year adjustment.
Non-resident PIE investors pay tax under different rules (typically a Notified Foreign Investor regime or the standard non-resident rate).
Common questions
- What is the highest PIR?
- The highest PIR for a NZ-resident individual is 28%. PIE tax is capped at this rate even if your personal income-tax rate is higher.
- What happens if I use the wrong PIR?
- If your PIR was too high, IRD refunds the over-paid tax in your end-of-year adjustment. If your PIR was too low, IRD collects the shortfall in the same end-of-year adjustment. Rules around refunds were tightened in 2020 to make refunds the norm rather than the exception.
- How often can I change my PIR?
- You can change your PIR at any time by notifying your fund provider. The new rate applies to PIE income earned from that point forward.
Primary sources
Related terms
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PIE fund · PIE
Portfolio Investment Entity (PIE)
A tax-efficient New Zealand fund structure where investor tax is capped at the investor's Prescribed Investor Rate (PIR), with a maximum of 28%.
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FIF rules
Foreign Investment Fund (FIF)
A New Zealand tax regime that applies to NZ-resident investors who hold most foreign shares or non-PIE foreign investment funds outside specific exemption thresholds.