12 July 2023 · Country Matchups · Oceania
Australia vs New Zealand: Investor Visas Compared
An Oceania shoot-out for globally mobile capital
I spend most mornings in Sydney’s Barangaroo precinct with a macchiato in one hand and client spreadsheets in the other. Even from this ivory tower of wealth management, one question never stops landing in my inbox:
“Should I park my capital across the Tasman in New Zealand or keep it onshore in Australia?”
Both countries woo high-net-worth families with investor visas that unlock residency—and eventually passports—in some of the world’s most stable economies. Yet the fine print differs in ways that can literally shave millions off your opportunity cost.
Below is the framework I use when advising portfolio holders with AUD 5-50 million to allocate to the region. If you prefer bullet points to glossy brochures, this one’s for you.
1. Capital Thresholds: How Much Skin in the Game?
Australia – Subclass 188B & 188C
| Stream | Minimum Investment | Asset Mix | Tenure Before 888 Grant |
|---|---|---|---|
| 188B Investor | AUD 2.5 m | 20% venture/PE, 30% ASX-listed managed funds, 50% balanced funds or direct | 4 years |
| 188C Significant Investor | AUD 5 m | Same mandated composition as above | 4 years |
Key nuance: the mandated 20/30/50 split means you can’t simply plough five million into blue-chip shares. Venture and private-equity exposure is compulsory, which can be a blessing (higher upside) or a migraine (liquidity risk) depending on your risk appetite.
New Zealand – Active Investor Plus (AIP)
| Category | Minimum Investment | Qualifying Assets | Tenure Before PR |
|---|---|---|---|
| AIP | NZD 15 m (or NZD 5 m if ≥50% in direct investments) | Listed equities, PE/VC funds, direct investments, philanthropy, some crypto (!)* | 4 years |
*The Kiwi regulator still treats crypto gingerly—due diligence files need to be encyclopaedic.
Why the gulf? New Zealand’s 2022 reboot retired the old “Investor 1/2” streams and set the bar deliberately high to filter for “active” capital. In my practice, the optics of NZD 15 million deter but don’t necessarily exclude; a structured direct deal (e.g., ag-tech or climate-tech) can slash the ticket to NZD 5 million.
Capital Deployment Timing
• Australia: funds must be committed within 4 months of 188B/C grant.
• New Zealand: incremental deployment is allowed, but 50% must be in place within 18 months.
Portfolio Manager’s Take-away
If you’re late-cycle cautious, Australia’s mandated fund split offers diversification on autopilot. If you crave deal flow and can stomach due diligence work, New Zealand rewards bespoke, direct stakes with a lower headline figure.
2. Residency Obligations: How Often Must You Touch Down?
Australia
• Minimum of 40 days per year physically in Australia for the primary applicant (or 160 days total over four years).
• Secondary option: have a spouse/partner fulfil 180-day requirement instead, letting primary applicant commute.
New Zealand
• 117 days over the four-year investment period (about 30 days per year).
• Days don’t have to be consecutive; time in the Cook Islands and Niue does not count—yes, clients have asked.
Calendar Engineering 101
A typical private-equity partner I work with clocks 90-100 travel days annually. For her, Australia’s 40-day rule is frictionless—she’s in Sydney every quarter anyway. For the Singapore-based family patriarch whose yacht is allergic to winter, New Zealand’s minimal 30-day cadence is the winner.
Pro tip: both immigration departments audit passports meticulously. Keep boarding-pass PDFs in your client folder; mismatched stamps can delay permanent residency confirmation by months.
3. Family Inclusion & Paths to Citizenship
Who Can You Bring?
| Relationship | Australia (188B/C) | New Zealand (AIP) |
|---|---|---|
| Spouse/Partner | Yes | Yes |
| Dependent Children | Under 23, single | Under 25, single & no kids |
| Parents | No | No (but later Parent Category visa possible) |
Permanent Residency & Citizenship Timeline
Australia:
1. 188B/C (4 years) →
2. 888 (Permanent Residence) →
3. Citizenship eligibility after another 12 months and four years legal residency with ≤12 months outside Australia.
New Zealand:
1. AIP (4 years) →
2. Permanent Resident Visa (PRV) – granted automatically if investment and day-count satisfied →
3. Citizenship possible after 5 years of residence including 240 days inside NZ in each of those years.
In raw calendar math, Australia offers a shorter runway—citizenship in roughly 5 years if you plan it right. New Zealand’s 5-year clock starts after you first become a resident, stretching real-world timelines to ~8 years for cautious travellers.
Education Quirks
Dependent children on both visas enjoy domestic tuition rates—worth up to AUD 35k per student, per year compared to international fees. If your heirs eye medical school in Melbourne, factor that cashflow.
4. Tax Environment: Paying Caesar Without Self-Sabotage
I’ll preface: this isn’t formal tax advice (my compliance department insists I say that). But here’s the crib sheet every wealth manager keeps in their back pocket.
Income & Capital Gains
Australia:
• Worldwide income once you become tax resident (183-day rule or “domicile & permanent place of abode” test).
• CGT discount of 50% for assets held >12 months.
• No inheritance tax.
New Zealand:
• No general capital gains tax, though “bright-line” rules tax residential property sold within 10 years.
• No payroll or social security tax if you structure correctly; instead, 39% top marginal income rate.
• No inheritance, wealth or stamp duty.
Foreign Investment Funds (FIF) Regime
NZ’s FIF rules levy a 5% deemed income on offshore share portfolios exceeding NZD 50k. That surprises incoming residents who assume “no CGT” means “tax-free.” Example: AUD 2 million in US ETFs? Expect an annual tax bill on deemed gains even if you don’t sell.
Transitional Resident Relief
Australia: four-year exemption on foreign income but not capital gains.
New Zealand: four-year exemption on most foreign income including FIF; CGT still absent.
This relief is often the swing vote. A Silicon Valley founder planning a liquidity event in year three could save millions under NZ’s broader holiday. On the flip side, Australia’s franking credit system tempts dividend investors seeking imputation offsets.
For more surgical optimisation, see our Tax optimisation guide—the principles dovetail with both regimes.
5. Holistic Decision Matrix
Below is the tool I walk through during client onboarding. Rate each criterion 1–5 in importance, then score the country:
| Criterion | Weight | Australia | New Zealand |
|---|---|---|---|
| Liquidity Needs | ___ | 20% locked in PE may hurt | AIP allows phased in, direct exits |
| Physical Presence Flexibility | ___ | 40 days/year | 30 days/year |
| Citizenship Speed | ___ | ≈5 years | ≈8 years |
| Tax Impact Next 5 Years | ___ | Global income, partial exemption | No CGT & wider transitional relief |
| Lifestyle / Schools | ___ | Mega-cities, private schools A+ | Smaller, high PISA scores |
| Climate Tolerance | ___ | Hot summers | Cooler, less bushfire risk |
| Political Stability | ___ | AAA rated | AAA rated |
| Growth Exposure | ___ | Minerals, renewables, AI | Agri-tech, green hydrogen |
Multiply, add—your spreadsheet will reveal which flag delivers higher after-tax, after-stress returns for your family.
6. Common Pitfalls (That Cost My Clients Real Money)
- Ignoring mandated venture allocation in Australia—someone tried stuffing 100% into an ASX ETF and faced cancellation.
- Assuming New Zealand’s “direct investment” can be a passive note. The Immigration NZ panel vets for active involvement—board seat, voting rights, KPIs.
- Overusing trust structures that trigger Australia’s “foreign beneficiary” land-tax surcharges.
- Forgetting that AIP funds must stay invested for 48 months and remain compliant assets—private start-ups that pivot out of eligibility can strand you.
- Not reading the fine print on crypto wallets for New Zealand; proof-of-reserves and chain-analysis reports are compulsory.
If this sounds daunting, bookmark our NZ-specific explainer: New Zealand Investor Visa 2024—Points & Pitfalls. For those weighing a broader skill-based route, my colleague’s Australia Skilled Independent Visa (Subclass 189) deep dive contrasts investment versus talent pathways.
7. Case Study: One Family, Two Outcomes
The Nguyens, a Vietnamese-American tech family, held USD 12 million in liquid assets and a stake in an L.A. SaaS start-up poised for Series C. They wanted Pacific time-zone overlap, English schooling and a rainy-day passport.
Scenario A – Australia 188C
• Invested AUD 5 m, including AUD 1 m venture.
• Relocated to Melbourne; father spent 45 days/year in-country.
• Dividend portfolio taxed globally but offset by franking credits.
• Permanent residency in year 4, citizenship in year 5.
Scenario B – New Zealand AIP
• Structured NZD 5 m direct stake in Wellington climate-fintech, plus NZD 10 m in PE fund.
• Family spent school semesters in Auckland (130 days first year, easing later).
• Exercised transitional exemption; realised USD 4 m capital gain tax-free in year 3.
• Citizenship target year 8; they’re comfortable thanks to zero CGT.
Net net: Australia delivered faster passports; New Zealand saved ~USD 1.6 m tax on the exit event. The Nguyens chose NZ—proof that “cheapest tax” can trump “fastest citizenship.”
8. Final Thoughts from the Wealth Manager’s Desk
When capital is your passport, visa rules are merely line items on your term sheet. Australia wins on speed and structured diversification. New Zealand seduces with tax leniency and lighter foot-in-country rules. The right call hinges on your liquidity calendar, exit horizons and family routine.
Still on the fence? BorderPilot’s algorithm digests your asset mix, travel schedule and tax profile, then benchmarks 30+ residency routes in under two minutes. Create your free relocation plan today—because even million-dollar decisions deserve data-driven clarity.