If you hold an Australian passport or permanent residency and you’re looking at property in New Zealand, you’re in a fortunate position. In most cases, you can buy a residential property here without applying for consent from the Overseas Investment Office (OIO). That’s a real advantage — it can save you months of waiting and a significant amount in legal and advisory costs.
But here’s where people get caught out, again and again: that exemption belongs to you as an individual. The moment you buy through a company or a trust — for tax reasons, asset protection, or simply because that’s how you hold things back home — the exemption doesn’t automatically come with you. If you get the structure wrong, you could break New Zealand law, which could mean having to sell the property, pay fines, and receive a lot of unwanted attention.
The number one mistake I see Australian buyers make isn’t about the property, but about the entity. People assume the exemption follows them into a trust or a company, but it simply doesn’t work that way under our law.
This article walks you through how the rules work, where the traps are, and why sorting out your structure before you sign anything is the single most important thing you can do.
The Australian and Singaporean Exemption: What It Covers
Under the Overseas Investment Act 2005, an “overseas person” generally needs OIO consent to acquire certain interests in New Zealand land. Australian and Singaporean citizens and permanent residents are treated differently: they’re largely exempt from the consent requirement when buying ordinary, non-sensitive residential land — a house, a townhouse, or an apartment.
Think of it as a personal pass, tied to your citizenship or residency status. It makes buying a home in New Zealand relatively straightforward, which reflects the close economic relationship between the countries.
The Exemption Is Personal: It Doesn’t Flow Through to Entities
This is the critical point. Under the OIA, a company or trust is assessed on its own terms. The question isn’t whether the person behind the structure is Australian — it’s whether the entity itself qualifies as an overseas person.
Many Australians buy investment property through companies or family trusts for perfectly sensible reasons. Australian trust law offers flexible estate planning, asset protection, and tax efficiencies, and a corporate structure might make sense for GST registration or liability management. But those structures were built for Australian law, and they don’t automatically fit New Zealand’s OIA framework.
The OIA Control Test: 25% Thresholds
The OIA uses a 25% threshold to decide whether an entity counts as an “overseas person.” If overseas persons own or control more than 25% of a company or trust, the entity is treated as an overseas person — and your personal exemption does not apply to it. For companies, the test looks at ownership and voting rights. For trusts, it looks at trustee positions, beneficial interests, amendment power, and any other form of control.
For Companies
A company is an overseas person if overseas persons hold or control more than 25% of its ownership or voting rights. That’s a relatively low bar.
Say you’re an Australian citizen who owns 100% of an Australian company, and you want that company to buy a New Zealand property. Because the company is wholly owned by an overseas person, the company itself is an overseas person for OIA purposes. Your personal exemption doesn’t transfer to it, and the company would need to apply for OIO consent like any other overseas investor.
The same logic applies if ownership is shared with other Australians or people from other countries. You add up all the overseas person stakes — if they collectively exceed 25%, the company is an overseas person.
For Trusts
Trusts are assessed under a broader, four-limb test. A trust is an overseas person if overseas persons satisfy any one of the following:
OIA four-limb test for trusts
0/0 completeMeeting any single one of these four tests is enough to bring the trust within the rules. A trust where an Australian couple are the only two trustees falls under the first limb. A trust where Australian beneficiaries hold more than 25% of the beneficial interest falls under the second limb. And if the trust deed gives the settlor, or a majority of beneficiaries, the power to amend it, you need to check carefully who those people are.
The Broad Beneficiary Trap
This is where things get particularly tricky for family trusts. Many Australian family trusts are drafted with wide, flexible lists of beneficiaries — something like “the settlors, their children, their grandchildren, their spouses and partners, and any other person the trustees choose to add.”
That kind of language is entirely normal in an Australian estate planning context. But under New Zealand’s OIA framework, the question becomes: could overseas persons end up holding more than 25% of the beneficial interest? If the answer is yes — even theoretically — the trust may be treated as an overseas person.
Future spouses and unborn children are often the hidden problem. An Australian settlor’s children might one day include a spouse who isn’t yet known, let alone a citizen of anywhere. The OIA looks at the substance of the beneficiary class, not just who is currently named. If the discretionary class could tip the trust into overseas person territory, that’s a problem worth resolving before you sign anything.
Family trusts drafted for Australian estate planning are often far broader than people realise once you look at them through an OIA lens. The flexibility that gives you options at home can be exactly what tips you into needing OIO consent in New Zealand.
Looking Behind the Register: ASIC and the “Beneficially Held: No” Flag
If you’re buying through an Australian entity, your New Zealand lawyer will often check the ASIC register as part of title due diligence. One thing to watch for is the “beneficially held: No” notation against share ownership.
That notation means the registered shareholder doesn’t hold the shares for their own benefit — they hold them for someone else. New Zealand law requires you to look through the registered holder and identify the ultimate beneficial owner, because that’s the person whose overseas person status actually matters for OIA purposes.
Back-to-Back Compliance: Two Legal Systems, One Purchase
When an Australian entity buys New Zealand property, the transaction operates under two legal systems at once. The entity itself remains governed by Australian company or trust law, while the New Zealand property is subject to New Zealand law — including the OIA, the Property Law Act 2007, and the land transfer system under the Land Transfer Act 2017.
That means your legal team needs to understand both sides. An Australian accountant or financial adviser familiar with the entity structure is not a substitute for New Zealand property law advice, and a New Zealand conveyancer unfamiliar with Australian trust deeds or ASIC registrations may miss something important.
The best approach is getting your Australian advisers and a New Zealand property lawyer talking early — ideally before you’ve identified a property, not after you’ve signed a sale and purchase agreement.
Structure Before Signing: The Auction Risk
New Zealand property sales increasingly happen at auction, particularly in Auckland and Wellington. At auction, you sign the agreement on the day, unconditionally. There’s no cooling-off period, no finance condition, and no due diligence window. You’re bound the moment the hammer falls.
If you bid at auction through an entity that turns out to be an overseas person, and that entity doesn’t have OIO consent, you’ve entered into an agreement that may be invalid and unenforceable under the OIA. Worse, you may face civil penalties and a collapsed deal — leaving you exposed to costs and reputational damage.
For private treaty sales, you can and should include a condition making the agreement conditional on OIO consent being obtained. That gives you a way out if the structure turns out to require consent. At auction, you don’t get that option.
At auction there’s no condition to fall back on, no finance clause, no due diligence window. If there’s any doubt about your entity’s status, that doubt needs to be resolved before you raise your hand, not after.
Get the Structure Right Before You Sign
The Australian and Singaporean exemption is a genuine advantage, but it’s a personal one. If you’re planning to buy New Zealand property through a company, a family trust, or any other entity, don’t assume the exemption carries over. The OIA’s control tests are broader than most people expect, the trust beneficiary rules are complex, and the consequences of getting it wrong are serious.
At NZ Legal, we work with Australian buyers regularly. We understand how Australian entity structures interact with New Zealand overseas investment law, and we can give you a clear picture of where your planned purchase sits before you commit to anything.
Get in touch with our team — fill out our quick contact form and we’ll be in touch within one business day.
Sources
- Overseas Investment Act 2005OIO consent requirements; Australian and Singaporean exemption; 25% overseas-person control tests for companies and trusts.
- Property Law Act 2007Governs property transactions in New Zealand.
- Land Transfer Act 2017Title registration and electronic settlement.
- Trusts Act 2019Governs the operation of trusts in New Zealand.
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