Deemed Rate Of Return For Foreign Investment Fund
DEEMED RATE OF RETURN FOR FOREIGN INVESTMENT FUND RULES
The annual deemed rate of return used for the purposes of the foreign investment fund (FIF) rules was set yesterday by regulation, the Minister of Finance and Revenue Dr Michael Cullen announced.
The rate for the 1999-2000 income year has been set at 10.74 percent. The deemed rate of return for future income years will continue to be set annually.
The FIF rules tax the income earned by foreign entities on behalf of New Zealand residents when the controlled foreign company rules do not apply. The deemed rate of return method is one of the four methods for calculating FIF income or loss.
The rate of 10.74 percent
will apply to all types of investments, including interests
in superannuation schemes and life insurance