1st September 2025

Roger Thompson, Director at Bentleys Chartered Accountants, today welcomed the New Zealand Government’s announcement relaxing the foreign ownership ban on residential property for holders of the country’s Active Investor Plus Visa—commonly referred to as the “golden visa.”

Under the new policy, eligible visa holders may now purchase or build one home in New Zealand valued at NZD $5 million or more. This marks a significant shift from the longstanding ban introduced in 2018, which restricted most foreign buyers, other than Australian and Singaporean citizens, from acquiring residential real estate. The exemption is designed to attract high net worth investors while preserving affordability for the broader housing market. Notably, rural, farm, and sensitive land remain excluded from foreign ownership under the new rules.

The Active Investor Plus Visa offers a pathway to residency for individuals investing a minimum of NZD $5 million over three years in higher-risk ventures, or NZD $10 million over five years in lower-risk investments. Visa holders and their families gain the right to live, work, and study in New Zealand, with eligibility for permanent residency after the minimum investment period and citizenship after five years.

Today’s announcement follows recently announced reforms to the Foreign Investment Fund (FIF) regime, aimed at reducing the tax burden on new migrants and returning New Zealanders. New migrants and certain returning New Zealand residents typically enjoy a 4 year holiday from NZ tax on their foreign investments as “transitional residents.” However, under existing laws, once the transitional resident period ends, foreign equities may be taxed under “foreign investment fund” (FIF) rules which can result in deemed income on unlisted shares of 5% of cost compounding each year. This can be quite harsh, particularly for startup investments, as a tax bill may arise, even when no dividends have been received and the investment value has declined.

From 1 April 2025, qualifying individuals who become tax resident on or after 1 April 2024 may apply a new “revenue account method” (RAM) to certain unlisted FIF investments acquired before residency. This method allows for more favourable tax treatment, including partial loss offsets, and may also apply to trusts where the principal settlor qualifies. Instead of a deemed 5% compounding return on the cost of unlisted FIF investments, the RAM method taxes dividends received and 70% of capital gains on a realisation basis.

Individuals still subject to citizenship-based taxation (e.g., U.S. citizens) may apply RAM to all their FIF holdings, regardless of when acquired or listed/unlisted status.

“These changes signal a clear intent to welcome global investors and entrepreneurs to New Zealand,” said Thompson. “With the right structuring and advice, high net worth individuals can now access premium residential property and benefit from a more accommodating tax regime. Bentleys is ready to assist clients and their advisors in navigating these opportunities.”

For further information or to arrange a consultation, please contact Roger Thompson at Bentleys Chartered Accountants.

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Roger Thompson
Email: roger.thompson@bentleysnz.com
Phone: +64 9 600 3902

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