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kiwisaver

KiwiSaver changes open the door to first farm ownership

Banking & Finance, Government & Policy, Property Law, Rural & Agricultural Law, Wealth & Retirement Planning
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Good news for rural workers

The government has announced important changes to KiwiSaver that will make it easier for farmers and rural workers to use their KiwiSaver to buy their first farm. These reforms acknowledge the unique way in which farms are owned and operated in New Zealand.

For many in the rural sector, particularly sharemilkers, contract milkers and farm managers eager to climb the property ladder, this represents a meaningful step toward farm ownership.

Legislation giving effect to these changes will be introduced to Parliament in the middle of the year.

 

Key changes

Until now, KiwiSaver first-home withdrawals have been limited to residential property purchases, with strict requirements that the buyer both owns and lives in the home. This has created barriers for those pursuing farm ownership, as farms are often:

  • Purchased through companies or trusts, rather than in an individual’s name, and
  • Used as both a business and a place of residence, sometimes with accommodation arrangements tied to employment.

The upcoming changes are designed to address these challenges by allowing eligible KiwiSaver members to withdraw their funds to buy a first farm, even where the ownership structure is more complex.

 

Who can benefit?

The updated rules will apply to people who would ordinarily qualify for KiwiSaver first-home withdrawal, who have contributed to KiwiSaver for at least three years and not previously owned a home (or being approved as a ‘second chance’ buyer). The changes are aimed at first-time farm buyers, not those expanding existing farming operations.

 

Key conditions

While the rules are becoming more flexible, there are still some important conditions for first-time farm buyers:

  • Control of the farm: You must have a meaningful ownership interest in the entity purchasing the farm (for example, a majority shareholding or controlling interest). This ensures KiwiSaver is being used to support genuine ownership, not passive investment
  • Connection to the property: The farm must still have a residential element connected to you. While the strict ‘live in the home’ rule is being relaxed, the purchase must still align with the intent of helping you secure your primary place of living and working
  • First property focus: The withdrawal remains limited to your first property purchase (or equivalent approved situation), and
  • Standard application process: You will still need to apply through your KiwiSaver provider, providing supporting documents such as a signed sale and purchase agreement and statutory declarations.

 

Why this matters for farmers

For many in the dairy and wider farming sector, progressing from employment or sharemilking into ownership has always required significant capital. KiwiSaver is often one of the few accumulated assets available to younger farmers. By allowing KiwiSaver funds to be used in farm purchases — and recognising company and trust structures – the law is now better aligned with how farming businesses actually operate.

This change is expected to improve access to deposits for first-time farm buyers, support succession planning within the rural sector and help younger farmers transition into ownership earlier.

 

Considerations before proceeding

While the changes are positive, there is still some complexity involved. Before relying on KiwiSaver funds for a farm purchase, it is important to consider:

  • How the farm purchase will be legally structured
  • Whether your level of ownership meets the control requirements
  • The impact on lending and finance arrangements, and
  • Ensuring your application meets your KiwiSaver provider’s requirements.

We recommend you seek legal and financial advice early in the process; this will help ensure everything is set up correctly from the outset.

 

Final thoughts

These reforms mark a practical and long-overdue shift in KiwiSaver policy. By acknowledging that farms are both homes and businesses, the government will create a more realistic pathway for rural New Zealanders to enter farm ownership.

With the changes in the legislative pipeline, if you are considering farm ownership, now is a good time to start planning and take advice on how best to position yourself.

 

 

DISCLAIMER: All the information published in Rural eSpeaking is true and accurate to the best of the authors’ knowledge. It should not be a substitute for legal advice. No liability is assumed by the authors or publisher for losses suffered by any person or organisation relying directly or indirectly on this newsletter. Views expressed are those of individual authors, and do not necessarily reflect the view of Edmonds Judd. Articles appearing in Rural eSpeaking may be reproduced with prior approval from the editor and credit given to the source.
Content Copyright © NZ LAW Limited, 2026.    Editor: Adrienne Olsen.       E-mail: [email protected]      Ph: 029 286 3650

Budget 2025

Budget & Taxation, Business & Investment, Economy & Finance, Politics & Government, Public Policy
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‘Fiscally conservative’?

On 22 May, the Minister of Finance, the Hon Nicola Willis, presented what she had termed a ‘No BS Budget.’ It is officially entitled ‘The Growth Budget.’

 

Described by the minister as being ‘fiscally conservative,’ public expectations were not high for a lolly scramble of funding for new initiatives.

 

In the weeks leading up to the Budget, the minister drip-fed announcements of about $1.9 billion of new spending and, amongst others, a significant ‘restructure’ to the pay equity regime. As a result,

it was anticipated that on Budget Day, there would be what the minister has called ‘reprioritising of spending.’

 

Over the past few years, New Zealand has experienced an extended period of high inflation, high interest rates and low growth. With this 2025 Budget and despite worldwide geopolitical and geoeconomic tensions, the minister has indicated New Zealand’s fiscal outlook will gradually recover, despite an initial period of retraction. The government now expects what the minister has called ‘a modest surplus’ by 2028–29.

 

Good news for business

Called Investment Boost, businesses can now write off 20% of the value of productive new assets such as machinery, tools and equipment from that year’s taxable income – in addition to regular depreciation rates. By encouraging investment, the government expects a 1% increase in GDP and wages by 1.5% over the next 20 years, with half of these gains being in the next five years.

 

Greeted positively by the business sector, these new rules came into force on 22 May, passed under urgency after the Budget was presented.

 

Intended to attract foreign investment to this country, the government has created a new agency, Invest New Zealand. The agency’s objective is to create a vibrant investment market in this country. Initially collaborating with New Zealand Trade and Enterprise, Invest New Zealand has a clear direction to attract international capital, ideas and expertise in order to lift wages and grow the country’s economy.

 

Additionally, the government says it will be easier for startups to compete for talent by changing how employee share schemes are taxed.

 

Supporting New Zealand’s strong position in the film industry, screen production rebates will be renewed.

 

Government cuts contributions to KiwiSaver

The government’s contribution to KiwiSaver accounts is to be halved. Until now, KiwiSaver account holders have received $521 a year from the government; this is to be cut to $260.72.

 

In addition, the threshold for the minimum ‘default’ rate of employee and matching employer KiwiSaver contributions is to be increased from 3% to 4%; this is to be a two-step process over the next three years. This will be optional; KiwiSaver account holders may opt to stay at 3%. With many KiwiSaver balances ‘modest,’ the minister says this change should encourage New Zealanders to save more for their retirement.

 

More positive news for New Zealand’s younger taxpayers is that 16 and 17-year-olds will start to receive government contributions to their KiwiSaver from July (currently there is no contribution). Requirements for employers to match these deposits will start in 2026.

 

Benefits

Jobseeker and emergency benefits to be means tested: Not anticipated by pundits, 18 and 19-year-olds will have their Jobseeker and emergency benefits tested against their parents’ incomes, although there are some exemptions. The threshold against which these benefits will be measured is yet to be decided.

 

Medicine prescriptions: The length of a prescription is to be extended from three months to 12 months.

 

Working for Families: Targeted at low to middle-income families with children, the family income threshold and abatement rate will increase by an average of $14/fortnight. The additional cost for this will be funded by extending the income testing for the Best Start tax credit to include the first year after having a child, as well as the current situation of means testing for the second and third years. Payments will cease when a family’s income reaches $97,000 a year.

 

SuperGold card: A rise in the income threshold will allow a rates rebate for 66,000 additional lower income households with a SuperGold cardholder.

 

Disability Support Allowance: $760 million has been allocated to support the disability sector. The government has called this a ‘seismic shift’ in funding.

 

More . . .

Already announced and included in Thursday’s Budget is more funding for health, education, law and order, and other frontline public services. This includes:

  • Significant additional funding for the education sector for children with additional learning needs, schools/early childhood education and tertiary operational grants; additional help with maths skills; and lifting school attendance,
  • Nelson Hospital is to undergo a much-publicised need for redevelopment, together with Wellington’s emergency department. Auckland hospitals are to be upgraded,
  • After decades of underinvestment, the country’s rail will receive a $460 million upgrade to the metro and regional rail networks, and
  • The Defence Force will receive significantly more investment to boost New Zealand’s capabilities for the army, navy and air force, and in cyberspace.

 

To read the Budget in more detail, click here for the minister’s Budget speech.

 

If you would like to discuss the implications of the government’s business incentives, please don’t hesitate to contact us.

 

Major changes ahead for New Zealand’s financial landscape.

Buying your first home using KiwiSaver funds

House
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But you’re already the trustee of a trust

The rules around the use of KiwiSaver have evolved over recent years as banks and other financial institutions have developed their understanding of the KiwiSaver regime.

KiwiSaver members may use their funds to help buy their first home; this is straightforward. What happens, however, if you want to buy your first home and you are already a trustee of a trust that owns property?

Initially, you could only access your KiwiSaver funds to buy your first home in your personal name; using a trust as a vehicle to purchase was not allowed. Now, however, the situation is more nuanced. An increasing number of lenders allow KiwiSaver members to make a withdrawal to finance the purchase of a first home, even where trusts are involved.

Let’s look at three scenarios to illustrate how this can work.

  1. You are a trustee of your friend’s trust, but not a beneficiary; as a trustee, your name is on the title to your friend’s home
  2. You are a trustee and a beneficiary of your parents’ trust; your name is on the title to their home, and
  3. You are a trustee and a beneficiary of a trust that has just been settled and so far only holds the initial $100 settlement; the trust does not hold property.

Trustee but not beneficiary

In scenario #1, the general rule is that if you are currently registered on the title to a property or land you will not qualify for a KiwiSaver first home withdrawal. The Financial Services Council of New Zealand, however, suggests that you will be eligible if you are registered as an owner of ‘an estate in land as a trustee who is not a beneficiary under the relevant trust’, because you haven’t previously held an estate in land (as you didn’t have a beneficial interest)[1].

Your argument will be even stronger where the trust of which you are a trustee has sold the property and you can establish that you received no financial gain from the sale.

Trustee and beneficiary

In scenario #2 where you are a trustee and a beneficiary of a trust which already owns property, it is necessary to establish that you have ‘no reasonable expectation that you will be entitled to occupy the land as your principal place of residence before the death of the occupier or of their survivor.’[2]

It may be difficult to establish that you have no reasonable expectation of being entitled to occupy the land as your principal place of residence if, for example, you are:

  • 18 years old or over
  • A trustee of the trust
  • Named on the title to the trust property, and
  • Occupying the home with your parents under a resolution that says ‘the settlors and their children aged under 20 years may occupy the property on the basis that they pay the rates, insurance and all outgoings usually payable from income.’

However, you could argue that once you turned 20 you would no longer have a reasonable expectation until after the death of your parents.

If there is no resolution in place, however, or a resolution that only authorises the settlors to occupy the home, then you may be able to argue that you have no reasonable expectation of being entitled to occupy the land as your principal place of residence (that is, you are there at the whim of your parents/the trustees and they can ask you to leave at any time).

Trustee and beneficiary of new trust

In scenario #3 where the trust has not purchased any property, some lenders, such as ASB, now allow the withdrawal of KiwiSaver funds to purchase your first home through a trust. The provisos are that the property being purchased is your first home, you are both a trustee and beneficiary of the trust, and you intend to live in the property as your principal place of residence.

To be eligible, your name (as the KiwiSaver member applying for a first home withdrawal) must be on the sale and purchase agreement or on a deed of nomination. This is good news for first home buyers who have good reason to want to hold assets in a trust, though care must be taken to ensure that your KiwiSaver provider will agree you are effectively in the same position as a first home buyer: one way to ensure that is to apply for approval prior to finding a property.

Being a trustee of a property-owning trust can create unwitting complications if you want to buy your first home using KiwiSaver funds. If you need some help in steering your way through the process, please feel free to get in touch.

[1] Financial Services Council of New Zealand.

[2] Clause 8(5), Schedule 1, KiwiSaver Act 2006.

Looking for your first home?

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Help to get your foot in the door

The purchase of your first home may be more in reach than you think. In 2018, the government aligned the purchase price limits of existing first home buyer schemes with the newly-launched KiwiBuild programme. As a first home buyer, or an eligible ‘second-chancer’, you could use these schemes to help you into your new home, sooner.

firsthome

KiwiSaver First Home Withdrawal

If you have been a KiwiSaver member for three years or more, you may be able to withdraw your KiwiSaver funds (except $1,000) to contribute to your first home purchase. Each KiwiSaver scheme has different requirements for KiwiSaver First Home Withdrawal applications and you should contact your scheme provider directly to check your eligibility.

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Insurance & Financial Services Ombudsman

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Getting help when you have difficulties with your insurer or financial services provider

The Insurance & Financial Services Ombudsman office (IFSO) was established in 1995 to help consumers who were in dispute with their insurers or financial services providers.

The IFSO[1] is a free, independent entity to which you can lodge a complaint regarding the conduct and decisions of insurance and financial services providers, once you have exhausted that provider’s internal complaints procedures.

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Sweeney Todd & KiwiSaver

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Enforceable undertaking accepted by WorkSafe after two students hurt in St Kentigern’s Sweeney Todd production

WorkSafe New Zealand has accepted an enforceable undertaking from the St Kentigern Trust Board following an incident in which two of their students were hurt during its production of Sweeney Todd in April last year.

WorkSafe’s investigation found that the board breached the Health and Safety at Work Act 2015 (HSWA) by failing to ensure, so far as was reasonably practicable, that the health and safety of students was not put at risk from work carried out as part of the business or undertaking.

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A Helping Hand for First Home Buyers

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Options for parents to help

It’s every Kiwi’s dream to own their own quarter-acre share of paradise. Unfortunately for many young people today, not only are the quarter-acre sections fast disappearing into multi-complex developments, but it’s also becoming harder than ever before with an ever-rising property market.

Every time you turn on the news, we hear something about the housing unaffordability in Auckland. Those south of the Bombay Hills start to get a bit glassy-eyed when listening to this on repeat. However, since the government’s introduction of the ‘LVR’ rules in October 2016 aimed at improving affordability in these markets, we must pay attention as all of New Zealand is affected.

The LVR explained

The loan-to-value ratio (LVR) is a measure of how much a lender will lend against a mortgaged property compared with the value of that property. Borrowers with LVRs of more than 80% (that’s less than 20% deposit) are often stretching their financial resources. As well, they are more vulnerable to an economic or financial shock, such as a recession or an increase in interest rates.

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Property Briefs

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Grants available to insulate rental properties

Recent changes to the Residential Tenancies Act 1986 require all rental properties to have ceiling and underfloor insulation meeting a set standard, where reasonably practicable, by 1 July 2019.

A limited number of grants (for 50% of the cost) are available through Warm Up New Zealand: Healthy Homes, on a first-come-first-served basis for rental properties occupied by low-income tenants and are not owned by a government agency. The criteria are:

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Looking at Buying Your First Home? Look into KiwiSaver

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The government announced on 31 July changes to Housing New Zealand’s KiwiSaver HomeStart scheme to help more first home buyers into the property market. These changes are effective from 1 August. If you’re looking at buying your first home, it pays to check whether you’re eligible to withdraw your KiwiSaver funds using the KiwiSaver First Home Withdrawal and to see if you qualify for the HomeStart Grant. Depending on how long you’ve been in KiwiSaver, the money you receive will go a long way in helping you open the door to your first home.

Glasses, save, savings.

KiwiSaver First Home Withdrawal

If you’ve been a member of a KiwiSaver fund for three years, you’ve never owned a home before and the property will be used as your principal place of residence, then you may be eligible to withdraw your KiwiSaver savings (except for the $1,000 government kick-start) through the KiwiSaver First Home Withdrawal scheme to put towards the purchase of the property.

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What happens to Kiwisaver funds in bankruptcy?

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fraud The Court of Appeal has recently confirmed what happens to a Kiwisaver account when a person is made bankrupt. The short answer is the bankrupt gets to keep their money.

Since the introduction of the Kiwisaver legislation there has been confusion and uncertainty around what happens to a person’s Kiwisaver account once they are made bankrupt. This uncertainty is caused by two seemingly incompatible provisions contained within two different Acts. On one hand the Insolvency Act says that all the bankrupt’s property belongs to the Official Assignee (the government employee who manages bankruptcies), Kiwisaver funds are property so those funds would belong to the Official Assignee. However, on the other hand the Kiwisaver Act says that unless a law ‘specifically’ requires the withdrawal of Kiwisaver funds then it is not possible to withdraw the funds unless the person is suffering financial hardship.

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+64 7 872 0236 [email protected]