Mortgage Broker

Tax guide for New Zealand self-employed mortgage brokers and advisers

Allowable Expenses

• FSCL/NZFSG membership — Financial Services Complaints scheme and industry fees
• Professional indemnity insurance — Required insurance for mortgage advisers
• Software & CRM — Mortgage management software, client CRM, comparison tools
• Client entertainment & networking — 50% deductible client meals and networking events
• Vehicle expenses — Travel to client meetings — km rate or logbook

Tax Tips

• Trail commission income is taxable in the year it is received
• Upfront commissions are taxable income in the year of receipt
• Professional development for mortgage advice is fully deductible
• FSCL membership fees are a deductible business expense required by law for operating a financial advice business

Frequently Asked Questions

How is mortgage broker commission taxed in NZ?

Commission income (both upfront and trail) is included in your gross income as a sole trader and taxed at your marginal income tax rate. Include all commissions received in the relevant tax year on your IR3.

Are FSCL membership fees deductible for NZ mortgage brokers?

Yes. Financial Services Complaints Ltd (FSCL) membership fees and other dispute resolution scheme costs are deductible business expenses required for operating a financial advice business.

Can I claim vehicle costs for client meetings as a mortgage broker?

Yes. Travel to meet clients at their homes or offices is a deductible business expense. Use the IRD kilometre rate (97c/km for the first 14,000 km) or the actual cost method with a logbook.

Do NZ mortgage brokers need to register for GST?

If your annual fee income (not the value of mortgages you arrange) exceeds NZ$60,000, you must register for GST. Some financial services may be exempt — check with a tax agent as the GST status of mortgage broking fees can be complex.