How To Do Your FIF Taxes For Investnow, Hatch, Stake

[@SkittleBombs]

What is the point of investing if you are making %8 p.a caital gains and 5% is being taxed and 3% inflation ?

[@henkhustle]

You get taxed 33% of the 5% (depending on your tax rate). Inflation is and always has been the real killer

[@SkittleBombs]

@@henkhustle Thanks for the clarifcation! I was assuming that, but i wasnt sure if that was the case. Would you do a video on simplicity Home loans ? I joined simplicity Kiwisave from watching your videos

[@henkhustle]

@@SkittleBombs What kind of information were you interesting in with the home loans?

[@chillrelax6915]

The government always wins.

[@sreevinayakaRaja]

What are the list of asx stocks that are exempted from fif tax?

[@carrotsandrunning]

thanks so much for making this. was pulling my hair out trying to understand the IR website flowcharts and such.

[@henkhustle]

Glad to have helped :)

[@carrotsandrunning]

@@henkhustle and here i am a year later having forgotten it all again ! :) thanks again !

[@carrotsandrunning]

every damn year ! lol

[@carrotsandrunning]

right on time :)

[@feiyaujoyce8871]

Hi Henk, this is a really helpful video. I noticed on your video you only mentioned about inputing the Overseas income value based on the FDR/CV calculation on the tax return form. Do we need to actually do a FIF disclosure in addition to the overseas income?

[@watzimagiga]

Thanks henk. This video was exactly what I was hoping for. You're the man 👍😁

[@henkhustle]

You're welcome :)

[@KadinYu]

Great video Henk- Question on Quick Sale adjustments - if you bought and then sold subsequently for a loss, can this loss be used to offset your total taxable FIF income? Eg. FIF income = $1,000 using FDR method (Before Quick sale adjustment). Quick sale adjustment = $500 (loss). Would Total FIF income = $500?

[@henkhustle]

FDR uses opening market value so the loss is not offset

[@Eejaysushi]

Thanks for the video. I noticed in the example when calculating FDR vs CV It confuses me a little... Of I have share in: Tesla value 50k Apple value 20k Does apple subject to FIF? with your example I do not know if it mean 50k total investment or 50k total investment in the same share will be subject to FIF.

[@henkhustle]

It's total not just individual shares

[@dlendwp1096]

Just a quick question on the FDR method - we use the investment value on April 1st. Is that the current year or previous year? Eg. 60k portfolio value 2020 (1st of April 2020) becomes 55k portfolio in 1st April 2021. When doing taxes in 2021, do I use 60k or 55k? Thanks in advance

[@henkhustle]

For filing in 2021 it should be 1st of April of 2020 but if you made a loss you could consider using the CV method

[@brat1056]

Hi Henk, thanks for the info. If over $50k, can that be split between husband and wife, so FIF doesn’t apply (I.e say $60k total therefore $30k each? Also, if over $50k (and can’t be split/apportioned) and say using the FDR method and essentially paying 5% annually on the market value, do you also have to pay income bracket tax (17% or 33%) over the entire gain made during the lifetime of the shares if you sell out completely or just still the 5% for that year (using the FDR method)? …even if non dividend paying shares? Thanks heaps

[@henkhustle]

I don't know about partners but for individual, it's personal tax rate of the 5%. So 33% of the 5% FDR (assuming 33% tax bracket)

[@James-zr1lu]

So, for FDR method, 5% of 100k = 5k, then 10.5% of 5k which = $525, if your tax bracket was @ 10.5%?

[@henkhustle]

Yup that's it

[@LoudValves]

does this mean that If you started investing last September and have over 50k invested, you must use the CV method as you had no funds on April 1?

[@henkhustle]

It is possible to pay tax based on the value of your investments at 1 April. Check out investnow.co.nz/expect-pay-tax-fif-investment-pie-fund/ If unsure, please consult qualified accountant

[@theknightofren]

Hey I have a question, what if you never filled a FIF before and your annual income is now 100k nzd from dividends through an overseas account and now you wish to bring that to an nz account? Your portfolio consists of over 300+ companies and you do not have all the dates you bought them. What do you do?

[@henkhustle]

In all honesty, if you have 100k from dividends your portfolio would be in the range of millions. I would suggest consulting an accountant because you don't want IRD coming to you

[@theknightofren]

@@henkhustle Thank you for your response! :)

[@leveragedigital9823]

Hi, Thanks for the video, so do we still need to pay 33% tax from the total profit made by selling shares of 10~15 years long term hold stocks? Says profit is 500k, 165k goes to tax?

[@henkhustle]

Assuming you are using FDR method you are paying 33% tax on the 5% of your total foreign shares. So no, you are not paying 165k in tax

[@ecomturbo2465]

You don't pay your 33% on selling shares anyways since its capital gains. You would only pay your 5% FIF and 33% tax on any dividends you get. Any profit from selling shares is not taxed.

[@jjsmusic2210]

Hope Stake does something like Investnow does and calculates the FIF tax for you

[@henkhustle]

Stake has integration with sharesight that you can use to calculate FIF tax

[@jjsmusic2210]

@@henkhustle do you need a subscription for that with sharesight?

[@henkhustle]

You can use the free version if you have 10 positions or less

[@leveragedigital9823]

Hi, thanks for your video. Do investors need to file FIF every year even just holding them, not selling any shares during the year? So 100k value stocks and 5% with Frd method, $5000 as taxable income for Ir3? Thank you.

[@henkhustle]

Yes, you apply your own personal tax % on top of the $5000

[@aldrichrasco2199]

Thanks Henk, great video! Quick question - for highly volatile investments/trades would you suppose that it would be better to use the FDR method for the FIF income calculation? (Assuming high returns)

[@henkhustle]

Honestly, just try out both methods. With FDR, your tax is capped so if you get high returns that's possibly the better method

[@goldenratio183]

Can you do a video comparing kiwisaver providers please.... milford generate etc

[@bennobathu9940]

Thanks Henk for the informative videos. Please keep it coming. How does tax works on sharesies with over $50Ks of US investment? Are we only taxed on profit only or on our entire investment portfolio? Do we only sell our shares to get taxed or will have to do so annually around April? Please a video explaining on this would certainly help.

[@henkhustle]

Depends on the foreign tax method that you use. There's the FIF and CV method. Tax on sharesies of US investments over 50k follow same rules as investnow

[@anhtrinh8511]

HI Henk! Thanks a lot for the video. Really useful information. I do have one question though, if I trade US shares for profit over the year , made some profits, and my account is over 50k invested... Would I be taxed twice: One is FIF income, other is income from share trading (trader tax) ?

[@henkhustle]

Ah, for trader tax you'd have to consult an accountant for that. It's bit of a gray area. The funds that I have are just long term buy and hold

[@dark8spirits]

Hi Henk, good job on the video. Just got few questions regarding to tax. I have a australian stock holding long term, now if I was going to convert to US ARDs and my initial investment is above $50k, do I have to pay FIF tax every year or when I sell it? Would I be able to claim the cost of conversion if I decide to sell it few years down the track? Reason I ask is because I'm not sure if I fall under "trader" and have to pay tax. If I do, I think it would make sense if I convert it to ARDs and pay it through FIF tax. It's a tricky one since I'm holding long term and the stock currently doesn't pay dividend.

[@henkhustle]

FIF tax is paid every year but you have the option to have no tax if the returns are negative under the CV method. Also there may be some exemptions for Australian companies but you'll have to double check that www.ird.govt.nz/income-tax/income-tax-for-businesses-and-organisations/types-of-business-income/foreign-investment-funds-fifs/foreign-investment-fund-rules-exemptions