Buying a house in NZ while living in Australia: Catch-22
Niche content alert. This post is about my journey through bureaucracy to meet the requirements to buy a house in New Zealand. It contains humour, of sorts, but unless you’re an Australian citizen or resident and you want to get a New Zealand IRD number — or you design processes within a government department or bank — you’re probably better off meditating for a few minutes and going about your day.
Once upon a time we saw a house in New Zealand that we wanted to buy. But we were Australian! What were we to do?
Can Australian citizens buy a house in New Zealand? Yes
The NZ government has helpful websites to answer questions such as these, and it was the first (and easiest) question to answer when we found a house we were interested in.
Is the process simple? Heck no!
I looked into the details of the process and discovered I needed something called an IRD Number.
From what I can tell — it doesn’t spell it out anywhere on the Inland Revenue website about IRD numbers — IRD is an abbreviation of “Inland Revenue Department”. An IRD number is equivalent to what in Australia we’d call a Tax File Number (“TFN”).
Step 1: Get an IRD number
OK, so let’s look at how to get an IRD number. Thankfully you can apply for one while you’re living overseas — as I am.
As the Barfoot & Thomson website points out, to get an IRD Number you need a New Zealand bank account.
Huh, OK then. That’s a strange requirement for someone living overseas. But it’s their country so I’ll play by their rules.
Step 0: Get a NZ bank account
Poop. That’s a bother.
But wait, didn’t the IRD page mention an alternative to a fully-functioning bank account? Yes!
Step 0b: Customer Due Diligence
I asked ANZ bank if they’d do a customer due diligence on me for the purposes of satisfying the IRD requirement. Nope: “For customer due diligence, this must take place in an ANZ New Zealand branch.”
ANZ Bank: the A stands for “Australia” and the NZ stands for “New Zealand”. I have an account in Australia but that’s no help at this point.
I can’t get an IRD Number without a NZ bank account, and I can’t get an NZ bank account without an IRD Number.
“Yossarian was moved very deeply by the absolute simplicity of this clause of Catch-22 and let out a respectful whistle.”
I can, however, get a customer due diligence by getting identified in person at a New Zealand bank branch.
Step -1: Go to New Zealand
In case you haven’t been reading the emails from that restaurant you went to once, four years ago, these are unprecedented times.
One does not simply walk into Mordor and ask to see the manager.
New Zealand Immigration allows some exceptions but getting a bank account is NOT one of them. I received a very swift rejection.
So, without permission to enter the country or an arrival date the bank account path is a dead end.
Aside: The traditional phrase uses the word tack; not tact. Tack refers to sailing and shifting direction to catch the wind. Tact sounds like it could be right, referring to tactics and using tact, and everyone knows what you mean so maybe because of common usage the dictionaries will be updated a la literally. /aside
“Applying for an IRD number when living overseas”
IRD has a webpage with this title so I had to believe they intended this to be possible, even if the processes didn’t support this. The other two options are “living in NZ and not a new arrival” and “living in NZ and are a new arrival”.
Option 3 “when living overseas” still says you need a bank account or due diligence, but the application form itself contains a cryptic reference to a workaround:
If you cannot provide a NZ bank account or customer due diligence refer to www.ird.govt.nz (Keyword search: offshore).
The prophecy spake of a way to obtain an IRD number without a bank account. The chosen one will be an outsider, it said; one from afar.
Keyword search: offshore
I entered the code word into the IRD terminal. Item number 14, just under “Petroleum mining operations outside of New Zealand” (for which I probably would have searched “petroleum” before “offshore” but whatevs) is this:
It wasn’t much, but compared with the other 55 results it was the best straw I had at which to clutch. /Seuss
Proof of Identity
This page, praise be its glory!, contains a whiff of a hint: “If it’s not possible to get a New Zealand bank account or customer due diligence, we may still issue an IRD number if you can satisfy the Commissioner of your identity.”
I’ll take that may and run with it.
Operation: Satisfy the Commissioner
Back to Step 1: fill in form IR742 IRD number application — non-resident/offshore individual, with a Commissioner-satisfying twist.
Ignore section 10 of the form. It’s a trap!
I was very grateful this was a PDF form and not a web form with a mandatory radio button, because I completed neither 10 nor 10b. I had already referred to keyword offshore. Nice try, form, but I’m not going around that loop again!
(I did go around that loop again just to make sure I hadn’t missed something.)
I electronically signed the form, labelled all my supporting PDFs, attached them, explained the attachments, and emailed them off to the IRD email address on the form.
One week later (quick!) I got a reply indicating the Commissioner was receptive but not yet satisfied.
Thank you for your email. All documents look perfect, the last thing we require is a NZ bank account from you both. However we see that you have provided overseas bank accounts, which will mean your IR742 form and all documents have to be verified by a lawyer/solicitor in Australia, along with providing a second ID, eg. Driver’s License Student ID.
Certifying documents: technology vs policy
A spent a good while trying to find out exactly how they wanted me to have electronic documents certified. I’d actually done this before submitting them the first time and came to the conclusion that there was no point.
Ordinarily, one would have a lawyer, accountant, post-office manager or other approved persons certify that a copy of a document was identical to the original. That’s what they’re certifying.
The IRD website was silent on the certification of electronic documents, which is how I would characterise the type of documents one can attach to an email, e.g. scanned documents or ones that are digital to begin with. But all the info I could find elsewhere said that there’s no point certifying electronic documents.
Anyway, I was under instruction to have the documents verified by a lawyer, and it’s their game so I’ll play it by their rules.
I went to a lawyer. I took my laptop with pages open so I could show them the official pages the documents had been downloaded from, and emails they’d been attached to. They printed out my documents, certified that they were copies of the originals, scanned them, and emailed them back to me.
I now had electronic documents that were (genuine!) copies of paper documents that were certified copes of the original electronic documents they were printed from.
Two days later this offshore individual got his shiny new IRD number.
The Commissioner was satisfied, and they all taxed happily ever after.