Under Budget 2026 changes applying from 1 April 2026, a founder or active investor who once held at least a 10% interest in a foreign investment fund can keep using the attributable FIF income (AFI) method even after their stake falls below 10% during business growth. The package also lifts the FIF de minimis threshold from $50,000 to $100,000, expands the revenue account method (taxing only realised gains and actual dividends) to all NZ residents' unlisted foreign shares, and re-aligns the 10-year FIF exemption so NZ shareholders keep it when their company lists offshore via a SPAC.
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NZ founders keep favourable FIF tax method as their stake dilutes below 10%
Why this matters for founders
If your equity will dilute below 10% across funding rounds, or your company eyes a US/SPAC listing, you avoid getting taxed on deemed dividends (5% FDR) on illiquid shares you cannot sell to fund the bill. Founders with foreign shares should ask their accountant how the AFI continuation, RAM expansion and $100k de minimis apply for the 2026-27 tax year.
Source: Inland Revenue (Tax Policy) - Foreign investment fund changes information sheet
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