Understanding the nuances of the Active Investor Plus visa programme is crucial for those considering investment migration to New Zealand. As wealth management professionals, we regularly guide clients through this complex decision-making process, helping them balance investment requirements with their long-term goals for residency and financial planning.
Understanding the Two Investment Pathways
The Active Investor Plus visa offers two distinct investment categories: Growth and Balanced. Each pathway requires careful consideration of different financial commitments, time requirements, and risk profiles.
The Growth category requires a $5 million investment over three years, with a minimum of 21 days spent in New Zealand during that period. In contrast, the Balanced category requires a $10 million investment over five years, with 105 days spent in New Zealand, though this can be reduced to 63 days with a higher investment of $13 million.
This structure creates a clear incentive toward the Growth category with its lower investment amount and significantly reduced time commitment in New Zealand. However, this comes with important trade-offs that investors must understand.
The Growth Category: Higher Risk, Lower Time Commitment
Despite its name potentially suggesting investments in listed growth equities, the Growth category specifically directs investments toward:
- Direct investments in privately-held companies through the New Zealand Trade and Enterprise (NZTE) deals platform
- Qualified managed funds, primarily consisting of venture capital, private equity, private credit, or agricultural/horticultural investments
These investments carry substantially higher risk profiles than many international investors might initially expect. The relatively small size of the New Zealand economy creates concentration risk, both from currency exposure and limited sector diversity.
Perhaps most importantly, investors should understand the liquidity constraints. While the visa requirement is three years, these investments typically demand longer holding periods. For many direct investments, it’s unlikely that investors will be able to exit within three years. They should approach this as a long-term commitment, potentially lasting 5-7 years or even longer, depending on economic conditions.
This extended timeframe is particularly crucial for venture capital and private equity funds. Investors should also be aware that with many people potentially going through the visa process simultaneously, there could be a significant call on capital all at once in 3 to 4 years’ time. This could further impact liquidity and exit strategies.
For those considering direct investments in companies, it’s essential to engage with lawyers to review contracts and negotiate terms. Tax and accounting professionals in New Zealand and the investor’s home country should be consulted to understand the implications of these investments. The exit strategy needs to be carefully considered and potentially coordinated with other shareholders.
While the Growth category offers a lower initial investment and fewer days required in New Zealand, the higher risk profile and liquidity constraints require careful consideration. It’s crucial for investors to thoroughly understand the sectors they’re investing in, the specific businesses involved, and all the legal, tax, and accounting considerations that come with these investments.
The Balanced Category: Lower Risk, Higher Time Commitment
The Balanced category offers a more conventional investment approach, allowing allocation toward:
- New Zealand listed equities
- New Zealand listed debt
- New property developments
- Philanthropic endeavours
While still carrying concentration risk due to New Zealand’s market size, these investments generally offer better liquidity and lower risk profiles than Growth category options. The trade-off comes in the form of a larger investment amount ($10 million versus $5 million) and a longer investment period (five years versus three).
The most significant difference, however, is the time requirement in New Zealand—105 days over the investment period, or 63 days with the higher $13 million investment option.
Aligning Investment Strategy with Long-Term Goals
The most important consideration when choosing between these pathways is how well they align with an investor’s broader objectives or goals.
For those genuinely interested in making New Zealand their long-term home, the Balanced category often makes more sense despite the higher initial investment. The investments better align with a long-term presence in New Zealand, and the day requirements become less burdensome if investors are planning to live here anyway.
For those primarily seeking the visa as a “Plan B” option with minimal time spent in New Zealand, the Growth category may seem more attractive, but the higher risk profile and liquidity constraints require careful consideration.
The Value of Professional Guidance
For investors, navigating these options requires expertise across multiple domains:
- Investment analysis to understand the risk profiles
- Legal expertise for contract review and negotiation
- Tax advice from both New Zealand and their home country
- Long-term financial planning that integrates the visa investments with their broader wealth strategy
- Collaboration between existing advisers and New Zealand-based professionals who understand the local context and requirements
For those investors who want to go down the Balanced route, and specifically those who also want to move to New Zealand and make New Zealand their long-term home, is where we can add the most value as a firm. We have over 15 years of experience working with US citizens and other migrants moving to New Zealand and the tax income complexities that come with that.
Making an Informed Decision
The Active Investor Plus visa represents a significant commitment regardless of which pathway investors choose. Beyond the financial investment, it’s important to consider how this decision fits into their broader life plans and wealth strategy.
For those serious about exploring these options, I recommend starting with a comprehensive discussion about long-term goals before diving into the specific investment categories. Understanding what investors hope to achieve through this visa, whether it’s establishing a new home in New Zealand or simply creating a future option, will guide which pathway makes the most sense for their situation.
by James Howard, CEO and Financial Adviser at Cambridge Partners
28 May 2025
