The rights of New Zealand permanent residents

The rights of New Zealand permanent residents are one of the leading considerations for Vietnamese investors and workers weighing settlement in the country. Permanent residents enjoy most of the rights of New Zealand citizens, including public healthcare, free education, the right to vote, social security support and, in particular, the right to move to Australia to live without a visa.

This article analyses in detail the full rights of New Zealand permanent residents, the difference between the Resident Visa and the Permanent Resident Visa, together with the obligations to be met to maintain residence status. This is essential information before Vietnamese investors decide to invest in the New Zealand settlement route.

Distinguishing the Resident Visa from the Permanent Resident Visa

Before going into the detail of the rights, a common confusion needs clearing up. New Zealand has 2 visas in the residence class:

• The Resident Visa (RV): this is the first visa granted to those who have just completed the settlement process. This visa has a condition on travel (usually 24 months). This means the RV holder has the right to reside permanently in New Zealand, but where they leave New Zealand after the travel condition expires, they cannot return as a permanent resident.
• The Permanent Resident Visa (PRV): this is the next step after holding the Resident Visa for a full 2 years and meeting the conditions of commitment to New Zealand. This visa has no travel conditions, allows unlimited entry to and exit from New Zealand, and never expires.

An important point to stress: both the RV and the PRV providethe same basic rightsin New Zealand, such as working, studying, and access to healthcare and education. The only difference is the condition on international travel. In this article, the term “permanent resident” is used generally for both residence visa groups.

The right to reside and work without limit

These are the most basic rights and the main reason investors pursue New Zealand permanent residence.

According to information fromImmigration New Zealand (INZ), permanent residents are permitted to:

• Live in New Zealand permanently, without time limit
• Work for any employer, in any position
• Change jobs freely, without needing a new work visa
• Be self-employed, set up a company, own a business
• Not be bound by a temporary work visa or the requirement for an accredited employer

This is a major difference from theAccredited Employer Work Visa (AEWV), which requires working for a specific accredited employer.

The public healthcare rights of New Zealand permanent residents

New Zealand has a state-funded public health system, ranked among the best in the world. Permanent residents have access to this system with the following rights.

Free or subsidised healthcare

According to information from Health New Zealand | Te Whatu Ora, permanent residents receive public health services comprising:

• Free examination and treatment at public hospitals
• Free emergency and accident treatment
• Necessary surgery and medical procedures
• Maternal and child healthcare
• Mental health services
• Family doctor (GP) appointments at subsidised rates

National accident insurance (ACC)

Permanent residents are automatically covered by the Accident Compensation Corporation (ACC). This system compensates the full cost of treatment and loss of income where an accident occurs in New Zealand, regardless of fault. This is a distinctive feature of the New Zealand welfare system that few countries have.

Subsidised prescription medicines

Medicines on the list funded by PHARMAC (the national pharmaceutical agency) carry a very low charge, usually only NZD 5 per prescription even though the market price may be hundreds of times higher.

Education rights

Education is the second most important right, particularly valuable for families with young children.

Free state education for children

The children of permanent residents study free of charge in the New Zealand state school system from primary through to the end of secondary school. New Zealand follows an internationally benchmarked curriculum, highly regarded for its quality and teaching methods.

University fees at domestic rates

Permanent residents and their children pay university fees at the domestic student rate, considerably lower than the international student rate. The difference in university fees between these 2 rates is usually 3 to 5 times.

Under the rules in force, first-year university students are usually exempt from fees entirely where they meet the residence conditions. The first-year fee-free policy continues to apply with some adjustments depending on the course.

Government student loans

Permanent residents have access to the New Zealand government’s Student Loan scheme, interest-free while still studying in New Zealand. This is an important financial support mechanism for students and families.

The right to vote

New Zealand is one of very few countries in the world that gives permanent residents the right to vote in national elections. Under the rules in force:

• Permanent residents may register and vote in parliamentary elections after 12 months of continuous residence in New Zealand
• They may vote in local elections (city and regional councils)
• They may not stand for Parliament (that right is reserved to citizens)

This policy has applied since 1975 and is regarded as the feature that gives New Zealand one of the most inclusive political communities in the world.

Social security rights

Permanent residents have access to the New Zealand social security system, although there are residence period requirements depending on the type of benefit.

The common benefits

The main benefits permanent residents may receive:

• Jobseeker Support: unemployment benefit, after 2 years’ residence
• Sole Parent Support: sole parent support, after 2 years’ residence
• Supported Living Payment: support for people with a disability or serious illness, after 2 years’ residence
• Working for Families: child support for low and middle income families
• Accommodation Supplement: accommodation supplement for rent and housing costs
• Best Start: support for raising children under 3

New Zealand Superannuation (the state pension)

Permanent residents aged 65 and over may receive New Zealand Superannuation where they have lived in New Zealand for at least10 yearssince the age of 20, of which at least 5 years since the age of 50. This is a universal pension, not dependent on how much has been contributed.

The right to move to Australia to live under the Trans-Tasman Travel Arrangement

This is the particular benefit that makes New Zealand permanent residence more valuable than many other settlement programmes.

Under the Trans-Tasman Travel Arrangement between New Zealand and Australia, New Zealand permanent residents donot automaticallyenjoy the right to move freely to Australia to live. That rightapplies only to New Zealand citizens(after naturalisation). Permanent residents therefore need to follow this route:

Step 1: hold a Resident Visa or Permanent Resident Visa for 5 years and meet the actual residence conditions in New Zealand.

Step 2: apply for New Zealand citizenship once eligible (usually 5 years’ residence).

Step 3: once a New Zealand citizen with aNew Zealand passport, enjoy the Trans-Tasman right to move to Australia:

• Travel to Australia without a visa
• Be granted a Special Category Visa (SCV) automatically on entering Australia
• Live, work and study in Australia indefinitely
• After 4 years’ residence in Australia, become eligible to apply for Australian citizenship on the shortened route (in force since 2023)

The overall route from New Zealand permanent residence to Australian citizenship usually takes 10-11 years, but it is the only indirect route leading to both citizenships within theFive Country Passport Group.

The right to own property and invest

New Zealand permanent residents have property ownership rights almost equivalent to citizens:

• Buying and owning residential property without limit
• Buying farmland under the rules of the Overseas Investment Office (approval required for large transactions)
• Opening bank accounts and taking out mortgages with New Zealand banks
• Investing in securities and investment funds in New Zealand
• Setting up a company and owning a business outright
• Joining KiwiSaver (the national retirement savings scheme) with government contributions

Buying a home is particularly important because New Zealand’s Overseas Investment Act 2018 restricts non-residents from buying homes. Permanent residents are exempt from this restriction and may buy freely.

The route to New Zealand citizenship

Once permanent residence is held, investors may apply for naturalisation to become New Zealand citizens. The basic conditions:

• Having lawfully resided in New Zealand for at least5 years
• Within those 5 years, having been present in New Zealand for at least 1,350 days
• In the most recent 12 months before applying, having been present in New Zealand for at least 240 days
• Holding lawful permanent residence in New Zealand (a Resident Visa or Permanent Resident Visa)
• Intending to continue living in New Zealand
• Meeting the good character requirement with a clean criminal record
• Having enough English to communicate at a basic level

Once naturalised, the person may hold a New Zealand passport and enjoys all the rights of a citizen, including the right to stand for Parliament and the Trans-Tasman rights with Australia.

Obligations and conditions for maintaining status

Alongside the rights, permanent residents must meet certain obligations to maintain their residence status.

Conditions on the period of residence

For holders of theResident Visa, the usual travel condition is 24 months. After that period, where they leave New Zealand, they cannot return as a permanent resident. This is why most RV holders choose to upgrade to a Permanent Resident Visa as soon as possible.

To be eligible for a Permanent Resident Visa, applicants must meet 1 of the 5 conditions of commitment to New Zealand:

1. Actual time resident: being present in New Zealand at least 184 days each year during the 2 years holding the Resident Visa
2. Tax residence: becoming a New Zealand tax resident for 2 years
3. Investment in New Zealand: maintaining the investment required by programmes such asActive Investor Plus Visa
4. Establishing a business: owning and running a business that contributes to the New Zealand economy
5. Building a base: having a home, family and job in New Zealand

Tax obligations

Permanent residents become New Zealand tax residents where they have a permanent place of abode in New Zealand or are present in New Zealand for more than 183 days in any 12-month period. In that case:

• Paying tax on worldwide income in New Zealand
• Filing an annual tax return where there is income beyond salary
• Paying the ACC levy on income

However, New Zealand has a 4-year tax exemption policy for new tax residents (Transitional Residents) on certain kinds of foreign income.

The obligation to comply with the law

Permanent residents must comply with New Zealand law. Where convicted of a serious criminal offence, particularly in the first 10 years after PR is granted, INZ may deport them and cancel their permanent residence.

Applicants should be alert toNew Zealand immigration fraud and scams.

The limitations of permanent residence compared with citizenship

Although they enjoy most of the rights of citizens, permanent residents still face certain limitations:

• No New Zealand passport; they must use their original national passport for international travel
• They may not stand for Parliament
• They may not serve in certain positions in the armed forces or the diplomatic service
• They may not move to Australia automatically (they must first naturalise as New Zealand citizens)
• Some social security benefits have a waiting period (2-10 years depending on the type)
• Permanent residence may be cancelled where a serious offence is committed, whereas citizens cannot be stripped of citizenship

Conclusion

The rights of New Zealand permanent residents comprise almost all the rights of citizens: freedom to work, high-quality public healthcare, free education for children, the right to vote in national elections, social security after the waiting period, and in particular the route to Trans-Tasman rights to move to Australia after naturalisation. This is an attractive combination of rights that few countries can offer.

However, Vietnamese investors need to understand clearly the difference between the Resident Visa and the Permanent Resident Visa, and grasp the conditions for maintaining permanent residence and the route to citizenship. Several important rights such as New Zealand Superannuation, the right to vote and the social security benefits all carry minimum residence requirements.

To choose the New Zealand settlement programme that suits their personal objectives, investors should consult a specialist adviser with knowledge of both the New Zealand immigration system and its welfare system. PLI provides full advisory services on the New Zealand settlement programmes, supporting Vietnamese investors from the preliminary assessment stage through to completing the settlement process.