Tax Friendly Change Benefit Kiwi Education Savers

Tax Friendly Change Benefit Kiwi Education Savers

New Zealand families saving for their children's higher education through scholarship plans will benefit from Australian tax law changes about to be enacted this week.

ASG Scholarships Group Managing Director, Mr Terry O'Connell said in Christchurch today that under the new arrangements there would be full reimbursement of all Australian taxes paid on investments by friendly societies at the maturity of scholarship plans.

Speaking at a conference attended by 150 ASG representatives from New Zealand and Australia, Mr O'Connell said that the changes would boost education benefits available for New Zealand children enrolled in ASG's Tertiary Programme by as much as $NZ 8,700 each.

Mr O'Connell said that New Zealanders would now be in an ideal situation to enjoy the benefit of tax-exempt savings' accumulations for their children's education.

He said that New Zealand families were becoming increasingly aware of the costs of post-secondary education and realising that it was important to begin planning early to give their children the best educational opportunities.

"The tax reimbursements will be an enormous help, and will become payable when most needed", Mr O'Connell said.

He added that as well as applying to new members, the amended Australian law also provided tax exemption for members who had started scholarship programmes up to 31 December last year.

Since ASG started operating in New Zealand in 1990 it has expanded its membership to a point where it now has close to 50,000 children enrolled for secondary and tertiary benefit programmes. Members funds managed in New Zealand benefit pools have increased to over $NZ 154.5 million.

ASG scholarships began to be paid from 1997 to students starting university and polytechnic studies. This year ASG expects to support a fresh group of over 450 New Zealand students starting their post-secondary studies in New Zealand and overseas. Including continuing students, it will pay allowances this year to more than 1200 students. Since inception, ASG has assisted more than a thousand students through its secondary programme and around 1600 with tertiary studies.

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