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About This Article

Written by: DFK Orb360 O’Halloran Content Team

Reviewed by: DFK Orb360 O’Halloran Chartered Accounting Team

Published: 19 September 2026

Last reviewed: 19 September 2026

Expertise: New Zealand accounting, taxation, GST and business advisory

FIF Tax Changes 2026: What NZ Investors Need to Know

FIF tax changes 2026 are an important development for New Zealand residents who hold overseas investments. Proposed changes introduced in September 2026 would increase the Foreign Investment Fund (FIF) de minimis threshold from $50,000 to $100,000 and expand access to the Revenue Account Method (RAM).

These proposals could affect how some New Zealand investors calculate tax on overseas shares, particularly people with unlisted foreign investments, migrants, returning New Zealanders, founders and investors with larger overseas portfolios.

However, an important distinction is needed: the proposed 2026 FIF changes are contained in a Bill that was introduced on 10 September 2026 and is currently at first reading. The proposals may therefore change as they move through the parliamentary process.

FIF Tax Changes 2026: Quick Answer

The FIF tax changes 2026 include proposed reforms to New Zealand’s Foreign Investment Fund rules. The proposals would increase the FIF de minimis threshold from $50,000 to $100,000 of overseas investments and expand access to the Revenue Account Method for certain foreign shares.

The proposed RAM would generally allow eligible investors to calculate FIF income using realised gains and actual dividends rather than relying on the standard FIF calculation methods that can attribute income before an investment is sold.

The proposals are intended to apply from 1 April 2026 for the 2026–27 tax year, subject to the legislative process.

If you hold US shares, overseas ETFs, unlisted foreign shares or other overseas investments, the proposed changes may affect how you calculate and report your New Zealand tax obligations.

Do You Have Overseas Investments?

FIF rules can become complicated when you hold overseas shares, ETFs, employee shares or investments through different entities. DFK Orb360 O’Halloran can help you understand the potential tax treatment and prepare for changes to the FIF rules.

Talk to DFK Orb360 O’Halloran about your overseas investment tax position.

What Are FIF Tax Changes 2026?

The FIF tax changes 2026 are proposed reforms to New Zealand’s Foreign Investment Fund regime.

A Foreign Investment Fund, or FIF, generally refers to certain offshore investments such as foreign companies, foreign unit trusts, foreign superannuation schemes and certain foreign life insurance interests.

New Zealand tax residents may need to calculate FIF income even when they have not actually received cash from an investment. This is one reason FIF taxation can be difficult for investors who hold overseas assets.

Under the existing regime, several calculation methods can apply, including the Fair Dividend Rate (FDR), Comparative Value (CV), Cost Method (CM), Deemed Rate of Return (DRR), Revenue Account Method (RAM) and attributable FIF income method, depending on the investment and investor’s circumstances.

The proposed 2026 reforms are intended to reduce compliance costs and address some of the cash-flow issues associated with the current FIF rules.

Why Are the FIF Rules Changing in 2026?

The Government’s stated policy objective is to make New Zealand more attractive to highly skilled people and capital while reducing tax compliance costs associated with foreign investments.

The current FIF regime can require income to be attributed to an investor even when the investor has not received a dividend or sold an investment. This can create a tax liability without a corresponding cash receipt.

This issue can be particularly significant for investors holding unlisted foreign shares because those investments may not be easy to sell simply to fund a tax liability.

The proposed FIF tax changes 2026 are therefore aimed at both reducing compliance costs for smaller investors and providing additional calculation options for eligible investors.

What Are the Main FIF Tax Changes 2026?

The proposed reforms contain several important changes.

Proposed change	What it means
FIF de minimis threshold	Proposed increase from $50,000 to $100,000 of overseas investments.
Revenue Account Method	Proposed expansion of access to RAM for unlisted foreign shares.
Extended RAM	Proposed wider access for certain New Zealand residents facing taxation in another jurisdiction.
Founders and active investors	Proposed changes would help certain investors continue using the attributable FIF income method when their business ownership falls below 10% during growth.
Corporate migration	Proposed changes would preserve access to the 10-year FIF exemption in certain situations involving overseas stock exchange listings.

These changes are proposals in the 2026 tax legislation and should not be treated as final law until the legislative process is complete.

Is the FIF Threshold Increasing From $50,000 to $100,000?

Yes, the Government has proposed increasing the FIF de minimis threshold from $50,000 to $100,000.

Under the current rules, an individual or eligible trust may generally use the $50,000 threshold for attributing interests in FIFs, subject to the detailed rules and exemptions.

If the proposed change becomes law, the threshold would increase to $100,000.

This is potentially significant for smaller investors who hold overseas shares or other FIF interests and currently need to consider the FIF calculation rules once their relevant investment cost exceeds $50,000.

Important: The $100,000 Threshold Is Proposed

The $100,000 threshold is part of the 2026 legislative proposals. Investors should not assume the threshold has already replaced the existing $50,000 threshold until the legislation is enacted and the applicable commencement rules are confirmed.

How Does the Current $50,000 FIF Threshold Work?

Under the current rules, the $50,000 threshold is based on the cost of attributing interests rather than simply the current market value of an investor’s entire overseas portfolio.

If the total cost of relevant attributing interests exceeds $50,000 at any time during the income year, the FIF rules can apply to the relevant interests rather than simply applying to the amount above $50,000.

This is an important distinction for investors who are close to the threshold.

Joint ownership can also produce different results because the threshold is considered at the individual level in relevant circumstances.

Because the current rules contain detailed definitions and exceptions, investors should avoid relying on the headline threshold alone when determining their tax position.

What Is the Revenue Account Method?

The Revenue Account Method (RAM) is a FIF calculation method designed to address some of the cash-flow difficulties associated with taxing foreign investments before they are sold.

Under the proposed expansion, eligible investors with qualifying unlisted foreign shares could generally be taxed on:

actual dividends received; and
70% of gains realised when qualifying shares are disposed of.

This differs from the commonly used Fair Dividend Rate approach, under which FIF income is generally calculated using a percentage of the opening value of the investment, regardless of whether the investor actually received that amount in cash.

Why Is the Revenue Account Method Important?

Consider an investor who owns shares in an overseas private company.

The investment could increase significantly in value during the year without the investor receiving any dividend or having an easy way to sell the shares.

Under a calculation method that attributes income without requiring an actual disposal, the investor can face a tax liability without receiving corresponding cash from the investment.

The proposed RAM is intended to address this issue for eligible investments by using realised gains and actual dividends as the basis for calculating income.

This could be particularly relevant to founders, employees and investors holding qualifying unlisted foreign shares.

Who Could Use the Revenue Account Method Under the FIF Tax Changes 2026?

The proposed FIF tax changes 2026 would significantly expand access to RAM compared with the initial version of the regime.

The Budget 2026 proposal would allow New Zealand residents to use RAM for qualifying unlisted foreign shares.

The proposal would also expand access to the extended RAM for New Zealand residents who face concurrent taxation in another jurisdiction because of citizenship or a right to work there.

This is particularly relevant to people who may have tax obligations in New Zealand as well as another country.

Are US Shares Affected by the FIF Tax Changes 2026?

US investments can fall within the FIF rules when held by New Zealand tax residents, depending on the nature of the investment and whether an exemption applies.

The proposed changes are particularly relevant to some people who face taxation in another jurisdiction, including individuals who may continue to have US tax obligations.

The proposed extended RAM is intended to address situations involving concurrent taxation and can potentially allow eligible investors to use a realisation-based approach for qualifying foreign investments.

However, US tax treatment is separate from New Zealand FIF treatment. An investor with US citizenship, US tax obligations or investments held through US entities should consider both tax systems before making decisions.

Do FIF Tax Changes 2026 Apply to Australian Shares?

Australian shares require careful consideration because the New Zealand tax treatment can depend on the type of investment, ownership percentage, Australian company status and applicable exemptions.

Some Australian investments may be treated differently under New Zealand’s international tax rules, so investors should not assume that every Australian share is automatically subject to the standard FIF regime.

If you hold Australian shares alongside US shares or other overseas investments, the overall portfolio should be reviewed rather than assessing one investment in isolation.

Do I Pay FIF Tax If I Have Not Sold My Overseas Shares?

Under the existing FIF regime, potentially yes.

FIF income can be attributed to an investor even when the investor has not received cash from the investment.

For example, under the Fair Dividend Rate method, FIF income is generally based on 5% of the opening value of the relevant foreign investment, subject to the detailed calculation rules and adjustments.

This means an investor may have FIF income even if no shares were sold and no dividend was received.

The proposed RAM is intended to provide a different approach for eligible investments by focusing on actual dividends and realised gains.

What Is the Difference Between FDR and RAM?

Feature	Fair Dividend Rate (FDR)	Revenue Account Method (RAM)
General approach	Deemed income calculation	Realisation-based approach for eligible investments
Dividends	Generally incorporated into FIF calculation rather than separately returned	Actual dividends can form part of taxable FIF income
Share sale	Not generally based on actual gain for the year	Proposed treatment includes 70% of realised gains for qualifying interests
Unrealised growth	Can result in attributed FIF income	Generally not taxed until qualifying gains are realised
Eligibility	Broadly available where applicable FIF rules require a calculation	Eligibility depends on the proposed RAM rules and investment type

What Happens If My Overseas Investments Are Over $100,000?

If the proposed $100,000 threshold becomes law, investors with relevant overseas investments above the threshold would still need to consider the FIF rules.

The proposed threshold is not a general exemption from tax on the first $100,000 of investments.

Instead, it is intended to increase the de minimis threshold for determining when the FIF regime applies to relevant interests.

This distinction is important because investors should not interpret the proposed $100,000 threshold as meaning that $100,000 of overseas shares can simply be ignored for New Zealand tax purposes in every situation.

What About Investors With Less Than $100,000?

If the proposed threshold becomes law, some smaller investors could have lower FIF compliance requirements.

For example, an investor whose relevant FIF interests have a total cost below the proposed threshold may be able to use the de minimis exemption, subject to the final legislation and eligibility requirements.

However, investors may still need to consider whether dividends and gains are taxable under other New Zealand tax rules.

The threshold therefore does not mean that all overseas investment income below $100,000 becomes automatically tax-free.

How Could the FIF Tax Changes 2026 Affect Migrants and Returning New Zealanders?

The proposed reforms are particularly relevant to migrants and returning New Zealanders who arrive in New Zealand with overseas investments.

The current FIF rules can create difficult cash-flow situations when an investor owns an illiquid overseas investment and is required to calculate FIF income even though the investment has not been sold.

The proposed RAM changes are intended to make the system more workable for qualifying unlisted foreign investments by allowing eligible investors to use a realisation-based calculation.

Investors returning to New Zealand should therefore review their overseas investment portfolio before becoming New Zealand tax resident or soon after establishing tax residence.

What About Founders and Employees With Overseas Shares?

The proposed reforms also address certain founders, active investors and key employees whose ownership percentage in a business falls below 10% as the business grows.

The proposal is intended to allow eligible investors to continue using the attributable FIF income method in certain circumstances even when their stake falls below the 10% threshold.

This could be relevant to people whose ownership percentage is diluted during fundraising or business growth.

Founders and employees should obtain advice before assuming that a change in ownership percentage automatically changes their New Zealand tax treatment.

When Would the FIF Tax Changes 2026 Start?

The Budget 2026 policy proposal stated that the proposed FIF changes would apply from 1 April 2026 for the 2026–27 tax year.

However, the relevant legislation is currently contained in the Taxation (Annual Rates for 2026–27, FBT Simplification, Foreign Investment Funds, and Remedial Measures) Bill, which was introduced on 10 September 2026 and is currently at first reading.

This means investors should distinguish between the proposed application date and the final law.

The legislation may be amended during the parliamentary process, so investors should check the final enacted provisions before filing a return based on the proposed changes.

Current Status of the 2026 FIF Changes

Policy announced: Budget 2026.
Tax Bill introduced: 10 September 2026.
Current parliamentary stage: First reading.
Proposed application date: 1 April 2026 for the 2026–27 tax year.
Important: Proposed rules can change during the legislative process.

What Should NZ Investors Do Now?

If you hold overseas investments, the FIF tax changes 2026 are a good reason to review your portfolio and current tax calculations.

1. Identify Your Foreign Investments

Make a list of foreign companies, ETFs, managed funds, private company shares, employee shares and other overseas investments you hold.

2. Determine the Cost of Your FIF Interests

Keep records showing what you paid for relevant investments and when they were acquired. The FIF threshold is based on specific cost rules, not simply the current value displayed on an investment platform.

3. Check Whether an Exemption Applies

Not every overseas investment is necessarily subject to FIF. Your investment type, ownership percentage and other circumstances can affect the tax treatment.

4. Review Your Current FIF Method

If you currently use FDR or another FIF calculation method, review whether the proposed reforms could affect your future calculation options.

5. Consider Your Cash-Flow Position

If you hold illiquid overseas investments, consider whether the proposed RAM changes could be relevant to your circumstances if enacted.

6. Keep Evidence and Valuation Records

Maintain purchase records, statements, transaction histories, exchange-rate information and other documentation needed to support your New Zealand tax return.

7. Get Advice Before Restructuring Your Portfolio

Tax should be one consideration when deciding whether to buy, sell or restructure overseas investments. Obtain professional advice before making a transaction specifically to achieve a tax outcome.

FIF Tax Changes 2026: Common Mistakes Investors Make

Assuming FIF tax only applies when overseas shares are sold.
Assuming the proposed $100,000 threshold is already current law.
Confusing investment market value with the cost-based threshold rules.
Assuming every overseas investment is subject to exactly the same FIF treatment.
Ignoring overseas investments held through employee share schemes.
Failing to keep original purchase records.
Ignoring foreign exchange movements when calculating investment values.
Assuming US or Australian investments automatically receive special treatment.
Changing investment structures without considering New Zealand tax consequences.
Assuming the FIF proposals will be enacted exactly as introduced.

FIF Tax Changes 2026: Example

Imagine a New Zealand tax resident holds $75,000 of qualifying overseas investments based on the relevant cost calculation.

Under the current $50,000 de minimis threshold, the investor may need to consider the FIF rules if the relevant conditions are met.

Under the proposed $100,000 threshold, that same investor could potentially fall below the proposed de minimis threshold.

However, this does not mean the investor’s overseas investment income is automatically tax-free. Other tax rules can still apply, and the final legislation will determine how the proposed threshold operates.

This example illustrates why investors should distinguish between the current rules and the proposed FIF tax changes 2026.

FIF Tax Changes 2026: What Investors Should Check

Before preparing your tax return, check:

What overseas investments do you own?
What was the original cost of those investments?
Have you crossed the current FIF threshold?
Do any FIF exemptions apply?
Which FIF calculation method are you currently using?
Do you hold unlisted foreign shares?
Have you recently moved to New Zealand?
Are you a returning New Zealand resident?
Do you have tax obligations in another country?
Do you hold employee or founder shares?
Could the proposed 2026 reforms affect your future tax calculations?

How Can DFK Help With FIF Tax?

Foreign investment taxation can involve more than simply applying a percentage to an investment balance. The correct treatment can depend on the type of investment, ownership structure, acquisition cost, tax residence, applicable exemptions and the calculation method available to the investor.

DFK Orb360 O’Halloran can assist individuals and businesses with understanding their New Zealand tax obligations relating to overseas investments and can help review the potential implications of the FIF tax changes 2026.

Our team can help with:

Reviewing overseas investment portfolios.
Understanding FIF calculation requirements.
Reviewing shareholder and investment structures.
Considering applicable FIF exemptions.
Reviewing records and investment information.
Preparing and reviewing tax calculations.
Understanding potential implications of proposed tax changes.
Providing broader tax planning and accounting support.

Need Help With FIF Tax in New Zealand?

If you hold overseas shares, ETFs, private company investments or employee shares and are unsure how New Zealand’s FIF rules apply to you, speak with the DFK Orb360 O’Halloran team.

Get professional advice before making investment or tax decisions.

FIF Tax Changes 2026: Frequently Asked Questions

What are the FIF tax changes for 2026?

The proposed FIF tax changes for 2026 include increasing the FIF de minimis threshold from $50,000 to $100,000 and expanding access to the Revenue Account Method for certain foreign investments.

Is the FIF threshold increasing to $100,000?

The Government has proposed increasing the FIF de minimis threshold from $50,000 to $100,000. The proposal is contained in 2026 legislation that is currently progressing through Parliament.

Is the $100,000 FIF threshold law yet?

The $100,000 threshold is part of the proposed 2026 changes and should not be treated as final law until the legislative process is complete.

What is the FIF $50,000 threshold?

Under the current rules, qualifying individuals and certain trusts can generally use a $50,000 threshold for relevant FIF interests, subject to the detailed rules. If the relevant cost exceeds the threshold, the FIF rules can apply to the relevant interests.

What is the Revenue Account Method?

The Revenue Account Method is a FIF calculation method that uses a realisation-based approach for eligible investments. Under the proposed expanded rules, qualifying investors could generally be taxed on actual dividends and 70% of realised gains from qualifying foreign shares.

Do I pay FIF tax if I have not sold my shares?

Under existing FIF methods such as FDR, an investor can have FIF income even if they have not sold the investment or received a dividend. The proposed RAM would provide a different approach for eligible investments.

Are US shares subject to FIF tax in New Zealand?

US shares can be subject to the FIF rules when held by New Zealand tax residents, depending on the investment and applicable exemptions. Specific circumstances, including concurrent overseas tax obligations, may be relevant to the proposed extended RAM.

Are Australian shares subject to FIF tax?

Some Australian investments can fall within New Zealand’s FIF rules, while specific exemptions and other international tax rules can affect the treatment. The investment should be assessed based on its exact structure.

Who could benefit from the proposed FIF changes?

The proposals could be relevant to smaller overseas investors, people holding qualifying unlisted foreign shares, migrants and returning New Zealanders, certain founders and active investors, and New Zealand residents facing concurrent taxation in another jurisdiction.

When would the FIF changes take effect?

The policy proposal stated that the changes would apply from 1 April 2026 for the 2026–27 tax year. However, the relevant Bill was introduced on 10 September 2026 and is currently at first reading, so investors should check the final enacted legislation.

Can an accountant help calculate FIF tax?

Yes. An accountant can help identify relevant overseas investments, determine whether the FIF rules apply, review available calculation methods and prepare or review the relevant tax calculations.

Related DFK Resources

Official FIF Tax Resources

FIF Tax Changes 2026: Key Takeaways

The 2026 FIF reforms are important for New Zealand residents with overseas investments.
The Government has proposed increasing the FIF de minimis threshold from $50,000 to $100,000.
The proposed changes would expand access to the Revenue Account Method for qualifying foreign shares.
The proposed RAM would generally tax eligible investments based on actual dividends and realised gains.
The proposals could be particularly relevant to people holding unlisted foreign investments.
Migrants and returning New Zealanders may need to review how the proposed changes interact with their existing overseas investments.
Founders, active investors and some key employees may also be affected by proposed changes to the attributable FIF income method.
The relevant tax Bill was introduced on 10 September 2026 and is currently at first reading.
The proposed application date is 1 April 2026 for the 2026–27 tax year, but the final rules depend on the legislative process.
Investors should distinguish between current FIF rules and proposed changes before preparing their tax returns.

Disclaimer: This article provides general information about FIF tax changes 2026 and New Zealand’s Foreign Investment Fund rules. It is not personalised tax, financial or investment advice. The 2026 FIF reforms discussed in this article include proposals contained in legislation that is progressing through Parliament and may change before enactment. Tax treatment depends on the investor’s circumstances, investment structure, tax residence and applicable exemptions. Speak with a qualified tax adviser or accountant before making investment or tax decisions.

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