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Ngā takawaenga kaihaumi hinonga kohinga haumi Portfolio investment entity investor proxies

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Portfolio investment entity (PIE) investor proxies (PIPs) are intermediaries through which investors can invest in a PIE. PIPs are not PIEs themselves but they take on responsibilities as if they were a multi-rate PIE (MRP).

PIPs are sometimes referred to as custodians, nominees or wrap accounts.

How to become a PIP

An entity needs to meet three criteria to become a PIP:

  • The entity must hold investor interest in an MRP for each individual investor.
  • The entity must give notice to the MRP that it is holding investor interest as a proxy.
  • The entity cannot become a PIP for an investor's investment in a listed PIE.

An investment in a listed PIE can be a part of the PIP's other investment activities.

Paying tax

PIPs file PIE periodic returns quarterly or monthly.

PIPs also file income tax returns for their non-MRP investment income.

What a PIP must do

A PIP must:

  • attribute income or loss, tax credits and pay PIE tax on investor income for the period
  • provide us with PIE returns relating to attributions, credits and payments
  • provide information to the MRP if its investors may cause the MRP to breach any of its eligibility criteria
  • adjust investor transactions to reflect the prescribed investor rate on the amount attributed.