FIF for couples and joint accounts: how the $50,000 is split

The $50,000 FIF threshold belongs to each person, not to each household. Inland Revenue says jointly held shares are split between the holders for the test, so a couple can hold more foreign shares together than a single person before the rules apply. But each partner is tested separately, which means one of you can be in the FIF rules and the other not, even on the same joint account.

The rule in Inland Revenue's words

IR461 (April 2026, p9) deals with joint ownership directly. Each person has their own $50,000. If you and your partner jointly hold attributing interests that cost $100,000 or less, "neither of you would be subject to the FIF rules because the $50,000 threshold would not be exceeded individually". If one of you also holds interests in your own name on top of joint interests costing $100,000, that partner is over the threshold and the other is not.

Inland Revenue's 2006 article on the new rules gives a worked example that still matches the Act's test of cost "more than $50,000" (ITA s CQ 5(1)(d)): each spouse holds $20,000 individually and $60,000 jointly.

In the last row, spouse 2 is still at $50,000 and still outside the rules. The test is applied person by person, on cost, on any day of the year (IR461 p9).

What each partner counts

• Your own-name holdings, on every platform, at cost.
• Your share of joint holdings, at cost. For two owners in equal shares, half. Our $50,000 test tool takes the joint cost and the number of owners and does the split.
• Not NZ PIE funds or KiwiSaver, which are not your FIF interests, and not qualifying ASX-listed Australian companies, which are exempt (IR461 p7).
• Not shares held by a family trust you are a trustee of, which the trust counts for itself; see family trusts.
• Not your children's own holdings, if they hold the shares themselves; see children.

Because the test is on any day, a joint purchase late in the year can tip one partner over for the whole year while the other stays under.

Worked example: one partner in, one out

Aroha and Ben hold shares jointly that cost $60,000 and were worth $80,000 at 1 April 2025. Aroha also holds shares in her own name that cost $40,000, worth $50,000. Ben holds $20,000 of cost in his own name, worth $25,000. No trades in the year.

For Aroha we assumed FDR is lower than CV this year; with her own figures the calculator would compare the two. Ben's figures come from our dividends under $50,000 tool, which estimates US withholding at 15% with a W-8BEN when you leave the tax field blank.

Note what happens on the joint account: the same shares are FIF interests for Aroha and ordinary dividend-paying shares for Ben. That is the result of a per-person test. It also means each of you needs your own records, even for a shared account.

A joint purchase that tips a partner over

Now say that in February 2026 Aroha and Ben buy another $20,000 of shares jointly. The joint cost becomes $80,000, so Ben's counted cost becomes $20,000 + $40,000 = $60,000. He is over $50,000, and because the test is "at any time in the year", he is in the FIF rules for the whole 2025/26 year (IR461 p9).

His FDR income is 5% of what he held at 1 April 2025: his own shares worth $25,000 and his half of the joint shares worth $40,000. That is 5% x $65,000 = $3,250. The new February shares add nothing to FDR this year, because they had no value at 1 April. With $60,000 of other income, the extra tax is $975.00 at 30%, compared with tax on about $1,300 of dividends the year before. Once he is in the rules, his dividends are no longer taxed separately; they are covered by the 5% (IR3G p21).

Neither partner did anything wrong here; the per-person cliff just arrived for Ben. Run the $50,000 test before a large joint purchase so it is not a surprise at tax time.

Method choice, credits and filing

Each partner is a separate taxpayer with their own IR3. On our reading:

• Each partner in the rules returns their own share of FIF income in box 17B, with their own IR1261.
• Each partner's FDR or CV choice covers all of their own FIF interests (IR461 p14), including their share of joint ones. The rule against mixing methods is per person, so on our reading one partner could use CV and the other FDR in the same year. This is our interpretation of a rule written for "a person"; confirm it with your accountant.
• Foreign tax withheld on a joint holding is split in the same shares as the income, and each partner's credit is capped at the NZ tax on their own FIF income from that company (IR461 p20).

In our FIF calculator, the "Your share of these holdings (%)" setting scales joint holdings to your share. Run it once for each partner.

Joint money, one name

A common situation is shares bought with joint money but held in an account in one partner's name, because the platform account was opened that way. People ask how to show Inland Revenue the shares are really joint. We have not found Inland Revenue guidance on this point. The obvious evidence is who the account is in the name of, whose money paid for the shares, and any agreement between you. If the account is in one name and you treat the shares as joint for the threshold, get your accountant's view first and keep the evidence with your tax records. The Sharesies help page we read does not cover joint accounts either (single source, 16 September 2026).

Practical points

• Check each partner separately, on the highest-cost day of the year, across every platform.
• If one partner is near $50,000, be careful which name new purchases go into. This is not advice on how to hold investments; just a reminder that the name on the account decides whose threshold it counts towards.
• If either of you chose to opt in to the FIF rules while under $50,000, the 4-year look-back applies to that person only (ITA s CQ 5(1)(d)(iii)).
• The proposed $100,000 threshold, which would have meant $200,000 jointly, is in a lapsed bill and is NOT LAW (status).

This guide is general information, not tax advice; check with your accountant, especially if your shares are in one name or your shares of ownership are unequal. Rules checked 12 November 2026.

Questions

Do couples get a $100,000 FIF threshold?

Not as a couple. Each person has $50,000. Joint holdings are split, so a couple holding only joint shares costing $100,000 or less are both under (IR461 p9).

Can one of us be in the FIF rules and the other not?

Yes. If one partner has extra shares in their own name, that partner can be over $50,000 while the other stays under, even on the same joint account.

How do we split a joint holding that is not 50/50?

Each owner counts their own share of the cost. Our tools take the number of owners for an equal split, and a percentage in the main calculator for anything else.

Do we file one return or two?

Two. Each partner files their own IR3 and reports their own share of the income and credits.

If we are both under $50,000, is there anything to file?

Usually yes. Each partner's share of the foreign dividends is still taxable overseas income, reported in box 17B with an IR1261, and any foreign tax withheld can be claimed as a credit in box 17A, within the limits.