With respect to New Zealand income tax, the new agreement applies to income years beginning April 1, 2016 or after April 1, 2016 and to Canadian income tax for income years beginning January 1, 2016 or after that date. Canada has tax agreements or agreements with many countries — commonly known as tax treaties. The main objectives of tax treaties are the prevention of double taxation and the prevention of tax evasion. Tax agreements: under the new agreement, the withholding tax rate on dividends will increase from 15% to a maximum of 5% for an investor holding at least 10 per cent of the dividend company`s shares. Finance Minister Todd McClay welcomed a new double taxation agreement between New Zealand and Canada, which is now in effect. The full text of the new Double Taxation Agreement between New Zealand and Canada is www.taxpolicy.ird.govt.nz/tax-treaties A new double taxation agreement between New Zealand and Canada came into effect on June 26, 2015. The agreement terminates New Zealand`s 1980 agreement with Canada and replaces it with a more modern agreement. The new agreement also generally reduces withholding tax on dividends, interest and royalties between the two countries. More information can be found in the media statement and in the text of the agreement. McClay says the new agreement, which reduces withholding tax on dividends, interest and royalties between the two countries, will be good news for companies and investors in both countries. “For businesses, tax agreements offer more security and reduce the likelihood of being taxed twice in cross-border transactions, while investors generally do better because of lower withholding tax on their cross-border investment returns,” Said McClay. “Canada is an important trading and investment partner for New Zealand. The new tax treaty updates and modernizes the 1980 agreement between our two countries and demonstrates the strength of the relationship we continue to share,” said McClay.

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. . . . . . In certain circumstances, Canada also imposes certain income on non-residents from Canadian sources, including withholding tax on interest, dividends, royalties, etc.