Working Remotely for An Australian Company in New Zealand: 2024 Guide
Thanks to COVID, we are now able to enjoy greater freedom and work remotely from anywhere. The bitter truth is that New Zealand is a very small market, so if you want to expand your horizons, why not work for our neighbors in Australia?
You can work for an Australian company from New Zealand as a sole trader, contractor, freelancer, or employee. However, you need to know the visa status requirements, tax regulations, and all the other important details before you decide which option works for you. Plus, you should communicate about all details and possible implications with your Australian employer.
Australian economy generates over $1,4T, while small New Zealand ranked 53rd in the world with a GDP of $204.9B. Therefore, you will have better employment prospects in a large country when comparing these two.
Fortunately, living in picturesque New Zealand and working for an Australian employer is much easier than you would think, so you don’t have to move overseas. Yet, you need to sort out some legal details, residency regulations, and the taxing process, and then you are all set to earn Australian dollars while spending New Zealand dollars.
Learn how to freelance in New Zealand.
Can you work for an Australian employer from New Zealand?
As mentioned, yes, you can work remotely from New Zealand for an Australian employer. But with that free will to work wherever you want to and which place suits you come a ton of complications and essential details to keep in mind.
Taxes
The main elements and complications involved in working remotely are taxes and visas. Unavoidably, you or your employer have to deal with it at some point, especially if you are not a New Zealand or Australian citizen.
The concept of how taxes are imposed based on residency and the area of income is a complex subject.
People often face difficulties figuring out the taxation rights, employee and employer relationship status, and the country where their pay originates from.
In any situation, it’s a good idea to work with a tax and immigration advisor to be on the safe side, but you can also research this information yourself, provided you have time.
Generally, if you are in New Zealand as a tourist, then tax regulations are not imposed on you the same way they are imposed on legal citizens of the country. Usually, a visitor tourist visa allows you to stay up to 9 months.
During this short period, you are not subject to paying tax fees. Limited exemptions are applied for a visit under 93 days. However, if you elongate this period, then new rules are applied to you.
Employment income earned from the services provided by an Australian company while living in New Zealand is considered Australian-sourced income and therefore is taxable there or in the country of your residence.
The main thing to keep in mind is where the source of income originated from and where you spend the majority of your time, have a registered address, etc.
Usually, an individual is subject to a tax on their foreign income, so you need to be prepared to file an income tax return at any time. But this depends on whether you are a resident or a non-resident and how long you have lived in New Zealand.
Foreigners are exempt from paying taxes on their foreign income sources in the first four years of living in New Zealand, however, this doesn’t include wages.
Therefore, if you live in New Zealand on a regular basis and work in Australia, you might be required to calculate, return, and file your own PAYE, according to Deloitte New Zealand.
This is called being an IR56 taxpayer. This scheme is called “a New Zealand-based representative of an overseas company”. If your employer has a presence in New Zealand, then they will do the PAYE.
By presence, we mean that an employer has a permanent establishment, a branch, a permanent office, or a site in the country.
If you are considering moving to New Zealand with your US job, read this article.
Residency regulations and taxation
When it comes to paying taxes based on your residency regulations, the basic two options are whether you have been in the country for more than 183 days or you have a permanent residency.
If you are already a tax resident of New Zealand, your worldwide income will be taken into account, and you will be taxed based on that. Then, it doesn’t matter whether the income was earned or paid, unless you apply for a four year exemption.
You will be considered a tax resident, which is different from immigrant residency in two ways. If you have been physically present in the country for 183 days or if you have a permanent place of abode in New Zealand.
However, if you are a non-resident, your taxation is subject to only the income originating in New Zealand.
Visa
Multiple visa options are available for working remotely in New Zealand for an Australian company. Generally, it would be a work visa, but your Australian employers must have a branch in New Zealand.
If not, you can obtain an Australian visa and only temporarily live in New Zealand. This doesn’t apply to citizens of both countries, as they have the freedom to live and work in either.
That said, the exact plan for acquiring a job for an Australian company depends on your nationality, country of stay, relationships with your employer, and job referral letter.
The most common visas people opt for include working as an Australian employee, freelancer, sole trader, contractor, or on the payroll.
The broader category for work visa options is skilled migrant resident visa, accredited employer visa, post-study work, talent work visa, and specific purpose work visa.
More details on how to opt for a working visa for remote working in New Zealand, how to apply, and the charges, rules, and taxes are given below.
If you are considering which country to choose for long-term living, check out our article about permanent residency in both places.
Working remotely for an Australian company: what to know?
Over the past few years, there has been a rapid increase in the number of people working remotely for Australian companies with residency elsewhere. If you are confused about approaching this option, continue reading to learn more!
The first thing you need to know is whether or not you have the right to work remotely for an Australian company or not. The choice of working remotely for an Australian company means you have to be a citizen or a permanent resident of Australia or have a work permit in the country where you are currently living, e.g. New Zealand.
And if not, then you need to have a work permit visa. In any other case, you can be held accountable for penalties.
Besides visas, professional insurances and licenses are also quite a hassle. Always remember that an employer’s insurance policies and necessary licenses hold power only in the particular foreign country they abide in. If an employee works from outside Australia, the insurance and licenses might not cover them.
Before you take a step towards this decision, you need to know what options are available for remote working.
Besides the first choices as freelancers, employees, contractors, and much more, other options with digital networking systems are offered as well.
Opportunities include working in IT, for example, as a software developer, programmer, or data analyst, or in other areas, e.g., as an administrative assistant, in customer service, in the HR department, or as a content creator.
Visas for working remotely in New Zealand
Working remotely has become a dream come true with ever-increasing technological developments. However, getting a visa based on your employment overseas is quite a rare occasion in New Zealand.
Generally, you must be either a New Zealand citizen, a permanent resident, or have a job with an employer based in New Zealand, yet, it can be a foreign company.
Therefore, for qualified people based elsewhere in the world, who want to work remotely in New Zealand, there are multiple options for how they can do that. With the rules, taxes, and requirements, everything is explained below.
Option 1: Working as a sole trader
Working as a sole trader means you will be self-employed, which in turn means you will have to manage your tax obligations all by yourself. Bummer, right?
But the good news is that if you are a resident or citizen of New Zealand, then you don’t need any other work visa.
The process follows registering your business with the Inland Revenue Department. Once you have an IRD number, you need to keep track of your budget, income, expenses, and so on.
The profit you earn from your work will be subject to income tax regardless of the amount of profit you make. But, if your annual yield exceeds NZ$90,000, you are required to pay GST.
Option 2: Working as an employee
Working as an employee is the safest, most hassle-free, and most secure way to land a job remotely. This is because the company takes you under its wing and provides licenses, insurance, and a legal job letter to you.
The visa options or work permits required for a job as an employee include a specific purpose work visa or the accredited employer work visa.
As a permanent resident of New Zealand, you don’t need to do anything, but general foreigners must get a job offer from a company represented in New Zealand and keep track of both visa processing and tax regulations.
Option 3: Working as a freelancer
Freelancing is yet another field of work that is self-employed and makes you responsible for managing your taxation. The rules are the same as that of a sole trader. You will need to set aside money from every pay cheque that you receive.
About 144,000 New Zealanders work based on self-employed contractors, which is equal to one in 20 of all employed people.
Generally, employment income like this one is taxed through the PAYE system, where the employer takes care of the entire tax process.
But this depends on your employer. For employees working remotely, there may or may not be a responsibility for the employer to manage PAYE.
In case you don’t receive PAYE income as a contract employee, your employment status changes automatically to self-employed, and you are legible to manage your taxes yourself.
Unfortunately, there is none if you are a foreigner moving to New Zealand and looking for a freelance/digital nomad visa. Currently, non-residents can’t get a visa to work as freelancers from New Zealand.
However, there are some ways around that. For instance, you can apply for a visitor visa or a working holiday visa. The first is valid for up to one year and the latter between 12 to 23 months, depending on your nationality.
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