Investment Fund Calculator NZ

Most New Zealand managed funds and KiwiSaver schemes are multi-rate PIEs. A multi-rate PIE works out taxable income and attributes it to each investor, taxing it at that investor's prescribed investor rate — 10.5%, 17.5% or 28%. The important part is what counts as taxable income, because a PIE does not simply tax every dollar the fund goes up.

NZ cash and fixed interest. Interest is ordinary taxable income of the PIE and is attributed to you at your PIR. This sleeve carries the heaviest tax load, because the whole return is taxable.

New Zealand and Australian shares. Amounts a PIE derives from disposing of shares in a company resident in New Zealand, or in certain Australian-resident companies listed on an approved ASX index, are excluded income of the PIE under section CX 55 of the Income Tax Act 2007. Inland Revenue's PIE guide puts it plainly: PIEs "are not taxed on gains on shares in New Zealand and certain Australian companies". Section CX 55 covers disposal proceeds only, so dividends on those shares remain taxable at your PIR. This is why the calculator asks for a dividend yield on this sleeve and leaves its capital growth untaxed.

Foreign shares. Offshore holdings fall inside the foreign investment fund (FIF) rules, and the PIE — not you — does the FIF calculation. PIEs use the fair dividend rate method, which charges tax on 5% a year of the market value of the holdings rather than on the actual return. Inland Revenue's FIF guide notes that under FDR "dividends and capital gains are not usually taxed separately". Because the base is value rather than return, FDR income still accrues in a year the fund falls: section EX 46(6) limits the comparative value alternative to natural persons and certain trustees, so a PIE cannot use it.

The practical consequence is that a growth fund is often taxed more lightly than a conservative one holding the same amount of money, because a larger share of its return arrives as untaxed NZ/AU capital gains rather than as fully taxable interest.

Start with the amount already invested and any regular monthly contribution. Enter a reasonable gross return scenario, then use the total annual fund charge shown in the fund's Product Disclosure Statement or latest fund update. Pick the fund type that matches your fund's risk tier, or choose a custom mix and enter the allocation from the fund's PDS — the preset mixes are indicative illustrations, not any provider's published allocation.

The result separates your own contributions from modeled growth, fees and PIE tax, and breaks the tax down by the sleeve that generated it so you can see the mechanism. It is best used to compare scenarios, not to predict a specific future return. For a side-by-side fee comparison, use the managed fund fee calculator; to find the correct rate, use the PIR calculator; and to see how FDR applies to shares you hold directly rather than through a PIE, use the FIF tax calculator.