The recently introduced Tax Bill includes significant tax changes for remote workers, including surprising tax reforms granting digital nomads a brand-new tax concession intended to reflect the visitor visa conditions. A New Tax Exemption for “Non Resident Visitors” Currently the NZ tax residency rules are not aligned with immigration visa conditions, which has led to unexpected tax consequences for many visitors. Individuals who spend 183 days or more in NZ may be deemed tax resident from the first day of their stay. Likewise, salary earned from a non-resident employer could be taxable in NZ, without a foreign tax credit recognising tax paid offshore. We have worked with many individuals who have had significant and unexpected tax liabilities because of these rules. The Proposal A pivotal change is the introduction of a new “non-resident visitor” tax status which will provide an exemption from the 183-day test. Under the proposed law, individuals who meet the following requirements should not become NZ tax residents, despite their extended stay: • are in NZ for 275 days or fewer within any 18 month period, • were not NZ tax residents or transitional residents immediately before arrival, • are lawfully present, • are not receiving a family scheme entitlement, and • remain tax residents of a foreign jurisdiction that imposes an income tax substantially similar to NZ’s. This exemption lifts them out of the 183-day rule that would traditionally trigger tax residency. Key Conditions: • Work must be exclusively for overseas clients or employers. • No on-site services to NZ individuals/businesses. • Work must not require the person to be physically present in NZ. • Must not undertake promotional work in NZ for NZ businesses. Interestingly, the carve-out for work that requires a person to be physically present in NZ uses an example of an influencer. The influencer is required to be physically present in NZ for her work, for example, a travel blogger. Such a person would not qualify for the exemption. Income Exemptions Clarified Under the proposed rules, certain categories of income are explicitly exempt for non-resident visitors: • Personal or professional services income earned while in NZ, provided it meets the non-resident visitor criteria. • Business income earned by a non-resident business or self-employed person that might otherwise be sourced in NZ due to a visitor’s presence is also exempt, unless it arises from a permanent establishment. • Income earned by a public entertainer is not covered by the proposed tax exemptions. Importantly, the activities of a non-resident visitor will be disregarded when determining whether a foreign entity has a permanent establishment in NZ. These proposals should ensure that remote work for foreign clients doesn’t inadvertently trigger NZ tax or permanent establishment issues. GST Registration Becomes Optional The Bill also proposes making GST registration optional for remote workers providing zero-rated services to overseas clients, even if their (zero-rated) turnover exceeds NZD 60,000. Looking Ahead If enacted from 1 April 2026, these proposals represent a significant shift in how New Zealand taxes visiting individuals and their non-resident employers. By aligning the tax rules with the conditions of visitor visas, the reforms introduce a welcome simplification and surprising tax relief. If you’re a remote worker, digital nomad, or employer wanting to understand how these changes may affect you, get in touch. Disclaimer: The information provided in this article is general in nature and does not constitute personalised tax advice. You should consult with a qualified tax adviser familiar with both US and NZ tax systems before making any decisions based on this content.