What is PIE (Portfolio Investment Entity)?
A Portfolio Investment Entity is a tax structure used by KiwiSaver schemes that pays tax on investment income at each member's Prescribed Investor Rate (PIR).
Detailed Explanation
All KiwiSaver schemes are PIEs. The provider pays tax on your behalf at your PIR (10.5%, 17.5%, or 28%) and the income does not appear in your personal tax return. The 28% PIR is also a cap — even if your marginal income tax rate is 33% or 39%, you never pay more than 28% on PIE income.
Example
On NZ$1,000 of PIE income at a 28% PIR, the provider sends NZ$280 to IRD; you see the net NZ$720 reflected in your unit price.
Frequently Asked Questions
Do I need to declare KiwiSaver income in my tax return?
No. PIE tax is paid by the provider; IRD performs an automatic square-up at year end if your PIR was wrong.