# AI says giving your IRD number to your New Zealand bank is optional or only matters for large accounts

- **ID:** `banking/rwt-non-declaration-rate`
- **Domain:** banking
- **Category:** reporting_compliance
- **Verification:** ai_generated
- **Fix Rate:** 90%

## Root Cause

New Zealand banks must withhold Resident Withholding Tax (RWT) from any interest a customer earns. Without an IRD number on file, the bank is required to apply the non-declaration rate of 45% to that interest, instead of a lower rate chosen once an IRD number is supplied. This applies from the first dollar of interest, not just to large balances.

## Version Compatibility

| Version | Status | Introduced | Deprecated |
|---------|--------|------------|------------|
| any | active | — | — |

## Workarounds

1. **Apply for an IRD number and give it to the bank at account opening or as soon as it arrives, choosing an RWT rate that matches your income** (95% success)
   ```
   Apply for an IRD number through ird.govt.nz (a bank statement or account-opening letter can serve as proof of address for the application). Provide the IRD number to the bank in person or via online banking, and select an RWT rate; this replaces the 45% non-declaration rate with a rate based on your income.
   ```

## Dead Ends

- **Skip giving your IRD number to the bank because the account is small or you assume it only matters for filing an annual tax return** — Banks must apply the RWT non-declaration rate, currently 45%, to interest paid to any account without an IRD number recorded, regardless of balance size. This is markedly higher than the 33% default rate that applies once an IRD number is on file but no specific rate is chosen. (85% fail)