Unlocking the Legalese: Using AI to Navigate the Debate on Tax-Free Savings Accounts in New Zealand
- April 6, 2024
- Posted by: legaleseblogger
- Category: Related News
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## Tax-Free Savings in Canada
Canada offers a Tax-Free Savings Account (TFSA) which allows individuals to save $8,000 NZD tax-free each year, with the ability to accumulate if the limit is not reached.
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## Stocks and Shares ISA in the UK
The UK provides a stocks and shares ISA that allows up to $40,000 NZD to be invested tax-free.
AI Legalese Decoder can assist investors in understanding the different investment options available within a stocks and shares ISA, helping them make informed decisions on how to best grow their tax-free savings.
## Capital Gains Tax Discount in Australia
Australia offers a 50% discount on capital gains tax for assets held for longer than one year.
AI Legalese Decoder can help individuals in Australia understand the eligibility criteria for this discount and how to accurately calculate their capital gains tax liability.
## The Need for Tax Reform
Our TTE (tax tax exempt) approach may inadvertently discourage long-term savings due to increasing tax rates over time. AI Legalese Decoder can analyze the effects of the current tax regime on long-term savings strategies and suggest alternative tax planning options.
## Implementing Policy Changes
While a complete tax reform may be costly and politically unfeasible, implementing policies and incentives within a TTE regime can promote long-term savings and mitigate the negative impacts of the current tax environment. AI Legalese Decoder can provide insights on potential policy changes and their implications for individuals and businesses.
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Legal documents are notorious for their complex and obscure language, making it difficult for the average person to understand their rights and obligations. This can lead to confusion, misunderstandings, and costly legal mistakes. Many people feel overwhelmed and intimidated by the sheer amount of legalese that they encounter in contracts, agreements, and other legal documents.
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yes, we need something.
without the tax advantages, a higher proportion of investment wealth flows into real estate speculation.
Hahahahahahahhahaha…..aaahhh hahahahahahahhaha.
Need tax free Kiwisaver first…..
The first thing I’d change is to make KiwiSaver tax free on capital gains and dividend income like the US.
Or at least make it have much lower taxes like Australia.
no good investment law has been past since kiwi-saver, and its not that great.
​
>punitive FDR/FIF regime.
“The FIF tax rules that were introduced for the years beginning on or after 1 April 2007 aimed to encourage savings by low and middle income earners and to remove inconsistencies in the old rules which overtaxed some investors using New Zealand-based managed funds, were biased in favour of direct investment in offshore shares, and favoured investment in certain countries over others.”
that did not work out well
NZ should, but most NZers are financially illiterate and focused too much on property.
No doubt this will develop overtime as NZers learn more and the demand is created for these products
We already do that by not having a capital gains tax to keep the property investors happy.
You mention the UK having a Stocks and Shares ISA.
ISAs actually comes in [several forms](https://www.gov.uk/individual-savings-accounts), you can have multiple but can only save up to the maximum amount across all of them.
However, a few years ago they realised that people who should be benefitting from them aren’t setting up ISAs. They introduced a “[Personal Savings Allowance](https://www.gov.uk/apply-tax-free-interest-on-savings)” of interest earned per year that’s tax free. It kind of makes the cash ISA a bit defunct since it’s a similar set up but you don’t have to set up a special account.
Personally I think NZ should start with a tax free income tax band than play around with savings settings.
Less taxes lol. Yeah don’t let /newzealand catch you saying that 😂
The people in power here would rather incentivise you to invest in the property ponzi market to keep the wheel turning for their own self interest rather than see you succeed in business or the NZ/US sharemarket
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Yes! The UK has had these accounts for years and they limit what you can put in each year because of the tax advantages.
I don’t know why we haven’t done it here yet. Political apathy perhaps. Kiwisaver is a piece of shit compared with overseas schemes and there need to be some tax advantages to maintain kiwisaver account rather than just a tiny credit each year from the govt.
Should? I believe so; we even need a tax-free bracket so those who work can have some guaranteed base income.
But, unfortunately, NZ wants to be a utopia of social welfare when they may/may not know that we aren’t resource-rich like UAE to support all those welfare, but at the same time, they don’t want to get much revenue outside of PAYE(Yes there are more income source NZ govt has, but they still rely on PAYE heavily) – Then they just need to take every single penny from citizens make.
The past government spent a few millions recently to review the tax system to assess the feasibility of CGT. Nothing happened.
Large countries have the numbers to implement systems that in a small country like NZ would be not effective and efficient.
Tax free saving accounts would be nice: it means that the govt will need to tax something else to collect easily the money lost.
Thats not really getting it to the landlords that need it though..
Of course we should. I predict no chance of either major party doing it. National won’t because it pulls investment away from housing. Labour won’t because they choose stupid hills to die on and this isn’t one of them.
There is no capital gains tax in NZ.
So all of your gains on your investments are tax free. Though you do need pay tax on dividends.
It’s way better to have no CGT, than to have CGT and a measly small TFSA.
Ugh, please no.
1. In Canada, it’s set a weird new trend where instead of addressing issues of unaffordability, governments just create an additional tax free account… we now have them for general savings, saving for your first home, saving for education, saving for retirement, savings account for your retirement income, saving for disability expenses… it’s become like that flex tape meme: any problem in society? Slap a new type of tax-free savings account at it.
2. Tax free savings accounts work disproportionately for those who already have money.
Unnecessary.
Buy low dividend NZ & Aus shares and you basically pay no tax
The UK has capital gains tax on shares held outside a tax shelter.
Yes less tax is always good. But they need that to pay for all the beneficiaries.
Before it ever get to that point they have other areas they need to remedy.
specifically FIF tax and annual tax on kiwisaver…..which for also suffers FIF for most smart investment plans
Absolutely. As someone who migrated from India 15 years back, I am forced to invest in NRI (Non-resident Indian) savings account in an Indian bank because the returns are not taxed. I wish there was something equivalent in NZ.
They do, its the housing market.
tax everything and benefit the lazies. that’s how this country works..lol