Investment Boost Calculator NZ
Deduct 20% of the cost of a new business asset up front and depreciate the rest. See the extra deduction in year one, the tax it saves and how it compares with standard depreciation.
Investment Boost deduction (20%)
Depreciate the remaining $4,800
Extra deduction in year 1
Tax saved in year 1: $168
Timing value of the tax saved
Over 5 years at 4%
| Year | Without Investment Boost | With Investment Boost |
|---|---|---|
| 1 | $3,000 | $3,600 |
| 2 | $1,500 | $1,200 |
| 3 | $750 | $600 |
| 4 | $375 | $300 |
| 5 | $188 | $150 |
| Total | $5,813 | $5,850 |
Investment Boost brings deductions forward. Over the life of the asset the total is the same; the gain is paying less tax earlier. Check eligibility before claiming.
How Investment Boost works
In the income year an asset becomes a new investment asset, the Act allows a deduction of 20% of the expenditure on the asset, less any capital contributions or government grants for it (section DI 5). The cost you then depreciate is reduced by that amount (section DI 6), so depreciation runs on the other 80%.
The calculator uses the depreciation rates for the asset type you pick, or your own, and applies them to the reduced cost. It compares each of the first five years with and without Investment Boost, and shows the timing value of the extra tax saved using the discount rate you enter. IRD's own timing illustration uses 4%.
What qualifies
- The asset is depreciable property, new or new to New Zealand, and has never previously been used or available for use in New Zealand by anyone.
- It first becomes available for use by you in New Zealand on or after 22 May 2025.
- You choose to apply the rule to the asset in your return. IRD says no notice is needed, and there is no limit to the value you can claim for.
- You must still depreciate the asset; you cannot elect it to be non-depreciable if you claim Investment Boost.
Not eligible: second-hand assets sourced from New Zealand, residential rental buildings and most fixed-life intangible assets such as patents. If your business use falls by 25% or more in a later year, part of the deduction comes back as income (section CC 15). Check IRD's guidance before claiming; this calculator does not decide eligibility.
Frequently asked questions
What is Investment Boost?
Investment Boost lets a business deduct 20% of the cost of a new investment asset in the income year it becomes available for use, then depreciate the remaining 80% as usual. It applies to depreciable assets first available for use in New Zealand on or after 22 May 2025. It is set out in subpart DI of the Income Tax Act 2007.
Does Investment Boost increase my total deductions?
No. IRD describes it as a form of accelerated depreciation: it does not change the total value of deductions you claim over the life of an asset, but it lets you claim a greater deduction in the first year, so you pay less tax earlier.
What assets can I not claim Investment Boost for?
IRD says you cannot claim it for second-hand assets sourced from New Zealand, residential rental buildings or most fixed-life intangible assets such as patents. The Act also excludes dwellings and fixed life intangible property from the definition of a new investment asset. The asset must never previously have been used or available for use in New Zealand by anyone.
How does Investment Boost work for a mixed-use asset?
You claim the deduction on your business-use share only. Under section DI 6 the cost you depreciate is still reduced by the full 20% amount, so an asset used half for business is depreciated on 80% of its cost, with half of each year's depreciation deductible. IRD's taxi example claims half of the Investment Boost amount and depreciates the remaining 80% of the cost.
Do I have to tell IRD I am claiming Investment Boost?
No. IRD says you do not need to notify it. The claim is included in your return, and your financial statements or IR10, with your other depreciation. The Act requires you to choose to apply the rule to the asset in your return.
What happens if I use the asset less for business later?
If your business use falls so that the deduction you would have been allowed drops by 25% or more, section CC 15 gives you income equal to the difference in that year, and the asset's adjusted tax value goes up by the same amount. A smaller change is ignored.
Does Investment Boost apply to assets costing less than the low-value threshold?
This calculator treats assets of $1,000 or less as written off in full, as the depreciation calculator does, so Investment Boost adds nothing for them.
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