Skip to content
Got a notice? Emergency response

New Zealand

Inheriting or receiving a gift from India as a New Zealand resident

This is the cleanest case. No inheritance tax, no general capital gains tax, so an Indian inheritance is largely tax-free on both sides.

You live in New Zealand and you have inherited or been gifted money or property in India, and you want to know the tax. Of all the countries an NRI lives in, this is about the cleanest. India does not tax an inheritance, and New Zealand has neither an inheritance tax nor a general capital gains tax. There is one narrow thing to watch if you sell an inherited home very quickly. Here is how it works.
Request a free CA call
Last reviewed: 27 July 20265 min readReviewed by Preetesh Maloo, CA

The short answer

This is about as clean as it gets. India has no inheritance or gift tax, and an inheritance, a bequest under a will, or a gift from a relative is exempt in the income-tax law, so the Indian receipt is tax-free. New Zealand has no estate duty, no gift duty and no general capital gains tax, so receiving the Indian money or property is not taxed, and selling an inherited asset later is generally not taxed either. The one narrow exception is the bright-line test, which taxes a gain on residential property sold within two years, and it can apply to overseas residential property held by a New Zealand tax resident. But inherited property is specifically excluded from the bright-line test, so even a resale is usually fine. New migrants also get a four-year transitional-resident exemption that shelters foreign income. Any Indian rent on the inherited property is taxable once that window ends, with a credit for Indian tax. Our job is the Indian side.

Is this your situation? Get a senior CA on it.

Free 15-minute call. We tell you what applies to you and what it costs, then you decide. You stay abroad.

Senior CA who specialises in NRI tax · we deal with the tax officer, you don't

Chat with a CA on WhatsApp

Related situations

About as clean as it gets

This is the reassuring one. India has no inheritance tax and no gift tax, and the income-tax law exempts anything you receive under a will, by inheritance, or as a gift from a relative, under the proviso to Section 56(2)(x), so the Indian receipt is tax-free. New Zealand matches that and goes further: it abolished its estate duty in 1992 and its gift duty in 2011, and it has no general capital gains tax at all. So as a New Zealand resident, you are not taxed on receiving an Indian inheritance, and unlike Australia or Canada, you generally are not taxed on selling the inherited asset later either, because there is simply no capital gains tax to apply to most gains.

That makes New Zealand the cleanest of the countries an NRI is likely to live in for this purpose. You do not declare the inheritance as income, and a long-held Indian property inherited and later sold usually produces no New Zealand tax at all. There is only one narrow thing to be aware of, and it concerns selling a residential property quickly.

The one thing to watch, and the new-migrant shelter

The narrow exception is the bright-line test. New Zealand does tax the gain on residential land sold within a set period, currently two years from purchase, and this test can reach overseas residential property held by a New Zealand tax resident, so in principle a quick resale of an inherited Indian residential property could be caught. The saving grace is that inherited property is specifically excluded from the bright-line test, including overseas property, so even if you sell an inherited Indian flat soon after receiving it, the exclusion generally takes it out of the charge. In practice, then, an inherited Indian property is outside New Zealand tax on sale whether you hold it or sell it, which is why this is the gentlest case of the four.

There is also a helpful rule for new arrivals. A new migrant, or a returning New Zealander who has been away long enough, is a transitional resident for up to four years, and during that window foreign income is exempt, so early Indian rent or investment income on the inherited asset is sheltered. Once that window ends, Indian rent on the property becomes taxable in New Zealand, with a credit for the Indian tax deducted. There is no New Zealand-India inheritance treaty, but none is needed. Our role is the Indian end: the legal heir paperwork, a valuation of the Indian asset, a certificate confirming no Indian death tax, and repatriation of the inherited funds to you.

What's involved

What the CA actually does

  1. 1

    We confirm it is clean

    We confirm the inheritance is tax-free in India and flag that New Zealand has no inheritance or general capital gains tax on it.

  2. 2

    We check the bright-line

    If you plan to sell an inherited residential property quickly, we confirm the inherited-property exclusion applies.

  3. 3

    We handle the heir paperwork

    We sort the legal heir or succession documents and the transfer of the Indian asset into your name.

  4. 4

    We repatriate the money

    We move the inherited funds out of India to you, through the permitted route, with the tax paperwork.

What to have ready

Documents you'll typically need

  • Details of what you inherited or were gifted in India
  • Whether you plan to keep or sell an inherited property, and when
  • The will or succession documents, if any
  • How long you have been resident in New Zealand

References on this page

  • India has no inheritance or gift tax; an inheritance, will or relative's gift is exempt under Section 56(2)(x), so the Indian receipt is tax-free
  • New Zealand has no estate duty, no gift duty and no general capital gains tax, so an Indian inheritance is not taxed on receipt or generally on later sale
  • The bright-line test can tax residential property sold within two years, including overseas property, but inherited property is specifically excluded
  • A four-year transitional-resident exemption shelters a new migrant's foreign income; Indian rent is taxable after that with a credit for Indian tax

Frequently asked questions

Common questions

No. India has no inheritance or gift tax, and New Zealand has no estate duty, no gift duty and no general capital gains tax. So receiving the Indian money or property is not taxed, and selling an inherited asset later is generally not taxed either. It is the cleanest case.

It can tax residential property sold within two years, including overseas property, but inherited property is specifically excluded from the test. So even a quick resale of an inherited Indian residential property is generally outside the charge. It is a narrow exception that usually does not bite.

For a while, yes. As a transitional resident, a new migrant gets up to four years during which foreign income is exempt, so early Indian rent or investment income on the inherited asset is sheltered. After that window, Indian rent becomes taxable, with a credit for Indian tax.

Yes, once your transitional-resident window ends. While you hold the inherited Indian property beyond that, its rent is taxable to you in New Zealand, with a credit for the Indian tax deducted. It is only the inheritance itself and most capital gains that are free.

The exceptions that change the answer

Where the general rule stops applying to you

Every rule below has a carve-out, a cut-off date or a condition that flips the answer. These are the ones that decide real cases.

LTCG rate: assets other than STT-paid listed equity (includes property)

Right now: 12.5% without indexation

Where it works differently

A RESIDENT individual or HUF sells land or a building acquired before 23 July 2024
May elect the lower of 12.5% without indexation or 20% with indexation.
Grandfathering proviso inserted by Finance (No. 2) Act 2024.
A NON-RESIDENT sells the same property
12.5% without indexation only. The election is NOT available.
The grandfathering proviso is expressly limited to resident individuals and HUFs. This is the highest-value NRI distinction on the site.
Shares or debentures of an Indian company were bought in convertible foreign exchange by a non-resident
The first proviso to s.48 computes the gain in that foreign currency, neutralising rupee depreciation. This is separate from, and not lost with, indexation.
First proviso to s.48 survives the 2024 changes.
Adding surcharge and cess
Surcharge on capital gains under s.111A/112/112A is capped at 15%, plus 4% health and education cess.
The cap applies to gains under s.111A, s.112 and s.112A.

Commonly got wrong

  • NRIs can choose 20% with indexation on property bought before July 2024. The election is resident-only. Stating otherwise understates an NRI's tax, which is the worst direction to be wrong in.Residents may elect 20% with indexation for pre-23-July-2024 land and buildings. Non-residents get 12.5% without indexation, full stop.
  • LTCG on property is 20%. Stale since 23 July 2024 unless the transfer predates it.12.5% for transfers on or after 23 July 2024.

Taxable gift threshold under s.56(2)(x)

Right now: Rs 50,000 aggregate in a financial year

Where it works differently

The giver is a 'relative' as defined
No limit and no tax, whatever the amount.
Explanation to s.56(2)(x). The definition includes spouse, siblings, siblings of spouse, siblings of either parent, lineal ascendants and descendants, and their spouses.
The gift crosses Rs 50,000 from a non-relative
The WHOLE amount is taxable, not just the excess.
The threshold is a cliff, not an allowance.
Received on marriage, under a will, or by inheritance
Exempt regardless of amount or relationship.
Proviso to s.56(2)(x).
A resident gifts to a non-relative NRI
FEMA applies separately from tax. Satisfying s.56(2)(x) does not make it FEMA-compliant.
Two independent regimes: one under the Income-tax Act, one under FEMA.

Commonly got wrong

  • Only the amount above Rs 50,000 is taxed. The entire sum becomes taxable once the threshold is crossed.Cross Rs 50,000 and the whole gift is taxable.
  • A cousin is a relative. Cousins are NOT within the statutory definition.Relative means spouse, brother or sister, brother or sister of the spouse, brother or sister of either parent, any lineal ascendant or descendant of you or your spouse, and the spouse of any of these. Cousins are not on the list.

Related

If this matched your situation, these go further

Selling Indian property while you are a New Zealand tax residentInheriting or receiving a gift from India as an Australian residentAdministering an Indian estate as an NRI executor, and the tax on itInherited Indian property taxRepatriation unblock (15CA / 15CB)NRI ITR filing (we file for you)DTAA rate lookupForm 10F generator

Inherited from India while living in New Zealand?

Tell us what you inherited and any plan to sell. A practising CA will handle the Indian side and confirm the New Zealand position, no obligation.

Request a free CA call

No card, no obligation. All certification and filing work is handled by ICAI-registered practising Chartered Accountants.