Australia-New Zealand Double Tax Agreement

Key articles of the 2009 DTA

The current Australia-New Zealand DTA was signed on 26 June 2009 and applies to income years from 2010 onwards. It is incorporated into Australian law via the International Tax Agreements Act 1953. The treaty follows the OECD model but folds independent personal services into the business profits article (no separate Article 14). Article 7 allocates business profits to the country of residence unless a PE exists in the other country. Article 6 gives taxing rights on income from real property to the country where the property is located. The Multilateral Instrument (MLI) has modified certain provisions, but core business-profits and PE rules remain substantively unchanged for 2025-26 and 2026-27.

When a permanent establishment arises

A PE under the 2009 DTA is a fixed place of business through which the business is wholly or partly carried on. The place must have a degree of permanence and be at the disposal of the enterprise. A building site or construction/installation project creates a PE only if it lasts more than 12 months. A dependent agent who habitually concludes contracts in the other country can create an agency PE. A genuinely independent agent acting on arm's length terms does not create a PE. Short projects without a fixed base or long-term site generally do not trigger PE status, though domestic withholding rules may still apply independently of the DTA.

GST versus GST: cross-border service rules

Australia charges GST at 10% on taxable supplies connected with Australia. New Zealand charges GST at 15% on supplies made in NZ by a registered person in the course of a taxable activity. Both systems follow place-of-supply rules based on where the service is consumed or where the recipient belongs. NZ zero-rates many services supplied to non-resident, offshore customers if the services are genuinely exported and not directly related to NZ land or goods in NZ. Australia similarly treats certain service exports as GST-free when the recipient is outside Australia and services are effectively used overseas. Onsite construction services in New Zealand are plainly NZ-supplied. If you are carrying on a taxable activity from NZ and exceed the NZ registration threshold, you must register for NZ GST and charge 15% output tax. Merely invoicing from Australia does not convert onsite NZ work into an exported service.

Trans-Tasman retirement savings portability

The Trans-Tasman Retirement Savings Portability scheme allows individuals who have permanently migrated to transfer retirement savings between NZ KiwiSaver schemes and Australian complying super funds regulated by APRA. Transfers are generally not taxed at the point of transfer. In the receiving Australian fund, transferred amounts may count towards non-concessional contribution caps. Breaching the non-concessional cap can trigger excess-contribution tax at high rates. The Social Security Agreement between Australia and New Zealand is a separate instrument that coordinates access to age pension, disability support, and carer payments. It allows periods of residence in one country to count towards eligibility for the other's covered payments (NZ Superannuation, Australian Age Pension).

Withholding obligations and domestic risks

Under the DTA, ordinary service fees to self-employed individuals are governed by the business profits article, not the withholding articles on royalties, interest, or dividends. If Article 7 allocates taxing rights exclusively to the residence country, the source country should not apply withholding. However, domestic withholding risks remain independently of the DTA. In Australia, a payer who does not receive an ABN from a supplier may need to withhold at the top marginal rate (currently 47%). In New Zealand, non-resident withholding tax (NRWT) and schedular payment rules apply depending on the payment nature and worker status. Labour hire arrangements in both countries can trigger withholding where the payer treats the worker as an employee or the arrangement is classified as labour hire.

Working holiday makers and temporary residents

Australian working holiday makers on 417/462 visas face a special tax scale: 15% from the first dollar up to $45,000, then higher marginal rates. They generally cannot access the tax-free threshold. New Zealand taxes its tax residents on worldwide income. NZ temporary residents benefit from a four-year exemption on certain foreign income. Non-residents are taxed on NZ-source income only, with a personal services exemption if presence does not exceed 92 days and other conditions are met. The DTA overlays a 183-day exemption rule for employment income. The 2009 DTA includes specific transitional-resident provisions: if an individual is exempt from NZ tax solely due to transitional-resident status, the treaty does not provide additional relief for that exempt income.

Practical record-keeping and registration

Maintaining clear, jurisdiction-separated records is essential for Trans-Tasman contractors. Keep separate bank accounts for NZ and Australian income. Code each job to its jurisdiction in your accounting software. In Australia, hold an active ABN and register for GST if above threshold. In New Zealand, apply for an IRD number and register for NZ GST if carrying on a taxable activity and exceeding the NZ threshold. Invoice NZ clients with NZ-GST-inclusive amounts when registered there. Invoice Australian clients with Australian GST on Australian-connected supplies only. Use local currency on invoices with the correct GST treatment. Retain all records for at least five years (Australian requirement) or seven years (NZ requirement, whichever is longer).

Statute references

• International Tax Agreements Act 1953 (Cth)
• Australia-New Zealand DTA 2009, Articles 5, 6, 7, 15, 22
• A New Tax System (GST) Act 1999 (Cth)
• Goods and Services Tax Act 1985 (NZ)
• Trans-Tasman Retirement Savings Portability scheme
• Social Security Agreement (Australia-New Zealand)

Frequently asked questions