How the system takes your money and gives it to the funds industry.
NZ's overseas investing rules are so complex and expensive that the only option looks like handing your money to a fund manager.
Three Kiwis. Same $200,000. Same shares. Different rules.
| Direct Investor | PIE Fund | NZ Company | |
|---|---|---|---|
| Tax rate on your shares | Up to 39% | 28% | 28% |
| Tax bill each year (on $200k at 39%) | $3,900 | $2,800 | $2,800 |
| Extra tax when you take money out? | No - it's already yours | No - 28% is the final tax | Only when you choose to pay yourself |
| Can you delay paying extra tax? | No - you pay every year | No extra tax to pay | Yes - keep reinvesting at 28% |
| Paperwork? | Yes - personal tax return | None - fund handles it | Yes - company tax return |
| Can you pick a better method in bad years? | Yes | No | No |
| When does the tax kick in? | Over $50k in foreign shares | No threshold | From dollar one |
| Fees to a fund manager | $0 | $600–$2,000/yr | $0 |
| Admin costs | $0 | $0 | $500–$2,000/yr |
| Hold overseas startup equity? | Tax grows as the startup grows, even if you can't sell | Not possible | Company can cover the tax from other investments |
| Best for | Small amounts under $50K | People who want zero hassle | Anyone serious about building wealth |
On your own: most tax, most work. Fund: easy, but fees and no control. Company: same 28% rate, no fund manager, you choose when to pay the rest.
Company pays 28%. You pay 39%. That 11% stays invested and grows. Over 10 years on $500K, that's $30,000 to $50,000 extra. No fees on top.
That's ~$47,000 more just by using a company. The longer you keep going, the bigger the gap gets.
Yes. But you choose when. And that choice is worth a lot:
The tax doesn't disappear. You just choose when to pay it. That choice is worth tens of thousands.
Even if you pay the full 39% later, you kept that 11% invested for years. It earned its own returns. You keep all that growth. Best case? You retire or move and keep most of it. This isn't a loophole. Companies pay 28%.
The number they hope you never calculate
gone. To fees you can see and fees you can't. From your money.
1% sounds small. But add hidden fees and the real cost hits 3.5%. Here's what that does over 30 years:
At 3.5% all-in: they keep $632K. You keep $275K. And what do they do? Buy the same index fund you could buy yourself.
The rules are so complex that most everyday accountants struggle to get them right.
- A widely shared sentiment among NZ tax professionalsFund managers used to earn their fees by picking good investments. The new system changed that. Now fees are based on how much money they hold, not how well they invest it.
Collect $10 billion, put it in an index fund, charge 1%. That's $100 million a year. Why try harder?
Shares = complex, expensive, punishing. Property = no FIF, no imaginary returns, no capital gains tax. So Kiwis put their money into houses instead.
Median house price went from 3x income to over 7x. A whole generation priced out. That's not a market. That's a policy outcome.
"Show me the incentives and I will show you the outcome."
- Charlie MungerAsset-hoarding fund managers. Property speculators. Both rational. Both created by the rules. The system works exactly as designed. Just not for you.
Before 2007, Kiwis could own American, British, and Australian shares without any of this tax nonsense. It was simple. Then the fund management industry got involved.
Everywhere else, you pay tax on money you actually make. Only NZ taxes money that doesn't exist.
Pretends you earned 5% every year. Taxes you up to 39% on it. Even if you lost money. Funds pay only 28%.
Only taxed when you actually make money. Hold for 12+ months and you get a 50% discount on gains.
Put up to £20,000/year into an ISA and pay zero tax on it - including foreign shares. Nothing. Nada.
You only pay tax when you get dividends or sell at a profit. Foreign and domestic shares treated the same.
Only half your capital gains count as income. Tax-free savings accounts can hold foreign shares directly.
New Zealand was the guinea pig. The idea was other countries would follow. None of them did.
The government excludes the fund industry's tax break from its official reports. Their reason? "Everyone can use a fund." That's like saying a coupon isn't a discount because anyone can clip it.
Over $123 billion in KiwiSaver taxed at 28% instead of real rates. The cost? Never officially measured.
The $50,000 FIF threshold hasn't moved in 25 years. More Kiwis hit it every year.
Every other country figured this out already:
1. Tax real money. Not imaginary 5%.
2. Tax-free savings accounts. UK, US, and Canada all have them. NZ has nothing.
3. Same rules for everyone. Same shares, same tax.
4. Update the $50K threshold. 25 years with no change.
We set up a company for you. You get 28%. You keep control. No fund manager. We handle all the paperwork.
Introducing
Your own company. 28% tax. Full control. We handle everything.
Company, bank account, investment account, tax. Done in days. You sign a few forms.
US stocks, ETFs, crypto, NZ shares. Your money, your choice.
Tax returns, filings, everything. You just invest.
| Invest as an Individual | Use a Managed Fund (PIE) | eccuity Investment Company | |
|---|---|---|---|
| Tax rate on foreign shares | Up to 39% (your tax rate) | 28% (fund rate) | 28% (company rate) |
| You choose what to invest in | ✓ Yes | ✗ The fund chooses | ✓ Yes - full control |
| Management fees | None | 0.5% – 1.5% per year | Flat annual fee |
| FIF tax headache | You figure it out | Fund handles it | eccuity handles it |
| Access your money anytime | ✓ Yes | Depends on the fund | ✓ Yes - it's your company |
| Tax savings for a $200k portfolio (FDR method / marginal rate 39%) |
$0 | ~$1,100/yr saved but you pay ~$2,000+ in fees |
~$1,100/yr saved and you keep the fee savings too |
More than $50K in overseas shares. You're already paying the tax.
Tax rate above 28%. Every dollar costs more than it should.
You pick your own investments. You just don't want the paperwork.
Find out if this works for you. No commitment. Just the numbers.