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PIE Guide — Portfolio Investment Entities and Prescribed Investor Rate in NZ

the Portfolio Investment Entities (PIEs) and the Prescribed Investor Rate (PIR) in New Zealand. The guide covers the PIE structure and the tax treatment, the PIR rates (10.5%, 17.5%, 28%), the calculation of the PIR, and the choice between the PIE and the direct investment.

PIE Structure and PIR Rates

The Portfolio Investment Entities (PIEs) are the collective investment vehicles (the managed funds, the KiwiSaver schemes, the unit trusts) that pay the tax at the "prescribed investor rate" (PIR) rather than the investor's marginal tax rate. The PIR rates for the 2025-26 year are: 10.5% (if the investor's total income is below $14,000), 17.5% (if the income is $14,001 to $48,000), and 28% (if the income exceeds $48,000 or the investor is the trust or the company). The PIR is the final tax — the investor does not need to declare the PIE income in the tax return.

Choosing the PIR and PIE Benefits

The investor must notify the PIE provider of the correct PIR using the IRD PIR declaration form. The wrong PIR selection may result in the underpayment (the IRD will assess the difference) or the overpayment (the refund is available through the tax return). The key benefit of the PIE investment is the tax cap — the investors in the 33% and 39% tax brackets pay only 28% on the PIE investment income. However, the imputation credits from the PIE investments are not refundable. See our Managed Funds Guide → for the fund selection strategies.