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Understand your tax obligations when you invest through Hatch.

Tax Centre

How to make sure tax time is sorted for your overseas investments (spoiler: it’s very straight forward for most of us)

What do I need to do at tax time for my Hatch investments?

The process may differ depending on how much you have invested overseas (more or less than $50,000 NZD).

What do I need to do with my Hatch income at tax time?

Your US tax on your Hatch dividends is sorted for you, but you may have to pay tax on your dividends in NZ.

Do I need to pay tax on my dividends?

You may or may not need to pay tax. It depends on your situation and Hatch gives you all the information you need.

Do I need to pay tax when I sell my shares?

Probably not. If your total untaxed income is under the threshold you likely won’t need to file a tax return.

Do I have to file a tax return if I’m under the $200 NZD dividend threshold?

We would if we could, but we only know about your Hatch investments.

Can you tell me how much tax I have to pay?

Tax 101

For most Hatch investors US tax is sorted for you.

Do I have to pay tax in the US?

The IRS apply a 10% withholding tax to the sale of US Publicly Traded Partnership (PTP) investments

US Partnership investments 10% withholding tax

Depending on your tax residency, a compulsory  W-8BEN or W9 form will be completed on your behalf to ensure you pay the right tax in the US.

What are W-8BEN and W9 tax forms?

In most cases, yes. But there are some catches you should know about.

Can I claim a credit on the US tax I've already paid?

If you've been with Hatch for three years (woohoo!), it’s time to make sure your US tax info is current.

Updating your US tax info

American Depositary Receipts (ADRs) were introduced in 1927 as an easier way to invest in foreign companies through the US share markets.

Tax on American Depositary Receipts (ADRs)

US tax

Foreign Investment Funds (FIF) are types of overseas investments.

What is a Foreign Investment Fund (FIF)?

How to use Hatch's FIF calculations to complete your NZ tax return

What do I do with my Foreign Investment Funds (FIF) calculation?

No, you won’t need to - it’s included in your Foreign Investment Funds (FIF) income.

If I fall under the FIF rules, do I have to include my overseas dividend income separately in my tax return?

If you’re paying FIF tax, working out your tax credits requires info that Hatch doesn’t know, so this guide will help you work it out.

How do I work out what foreign tax credit I’m entitled to if I’m a FIF taxpayer?

Foreign Investment Funds (FIF) tax

Can I buy the FIF Report even if the FIF rules don’t apply to me?

No, but it calculates your FIF income, which you can use to determine the amount of tax you need to pay.

Does the Hatch FIF report tell me how much tax I have to pay?

A guide to the CV and FDR income calculations

How the Hatch FIF report calculates FIF income

How we interpret your transaction data when calculating your FIF income

Understanding FIF transaction types

Hatch FIF Report

Investment cost is the cost price you paid for your investments

What is investment cost?

Your investment cost includes the cost price of the shares you’ve purchased and your available balance.

What’s included in my investment cost?

No. Your investment cost doesn’t include gains or losses on your investments.

Is my investment cost the same as my portfolio value?

Does my investment cost include gains or losses on my investments?

Changes to the exchange rate won’t impact your investment cost on shares you own.

Can exchange rate changes cause my investment cost to go over $50,000 NZD?

Yes. Your investment cost will be impacted by withdrawals.

Does my investment cost decrease when I withdraw my available balance?

No. Most Australian shares are exempt from the FIF rules, and we exclude all exempt shares.

Are Australian shares included in my investment cost or FIF income calculations?

Your investment cost is calculated using end of day exchange rates and your USD investment cost from our broker.

How does Hatch calculate my investment cost?

Share transfers may cause your investment cost estimation to be incorrect in Hatch.

Does transferring shares to or from Hatch impact my investment cost?

We use exchange rates from the European Central Bank.

Which exchange rates are used to calculate the NZD value of my investment cost?

If you haven’t gone over the $50,000 NZD FIF threshold, your  investment cost will be updated every time you refresh the tax report page.

How often is my investment cost updated on my current year Tax Reports page?

We show your current investment cost so you can track how close to the $50,000 NZD threshold you are.

Why do you only show the peak investment cost when I've gone above the FIF threshold and not before?

Investment cost

Some types of income are not taxed before you receive the money. This income may need to be included in an individual tax return.

What types of income aren’t automatically taxed in New Zealand?

Jurisdiction is the country or territory your income comes from

How do I work out the Jurisdiction of my investments for my tax return?

If you’re considered a ‘trader’ instead of an investor, you may have to pay tax on any profits when you sell shares

What is a share dealer/trader?

If you purchase shares with the intention to sell them at a profit, rather than earning dividend income from holding them

What does investing for a profit mean?

In most cases, yes. But there are some additional things to consider.

Can I claim a tax credit on American Depositary Receipts (ADRs)?

There are a lot of things we need to take into account when providing tax numbers for you.

Understanding your Hatch tax reports: where we get the data from

Hatch App

Find answers and get help from Intercom Support and Community Experts

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