Determining whether borrowers are New Zealand-based or overseas-based

2011 changes to the way borrowers who qualify for exemption from the requirement to be present in NZ are treated in determining whether they are NZ-based.

Sections 21-29 and schedule 1

Changes have been made to the way borrowers who qualify for one of the exemptions from the requirement to be present in New Zealand are treated for the purposes of determining whether they are New Zealand-based.


The rules determining when a borrower is New Zealand-based or overseas-based mainly remain the same. This includes the current exemptions from the requirement that a borrower must be present in New Zealand for at least 183 consecutive days, which are continued in the new Act.

The original intent of the exemptions was that for borrowers who meet the requirements of one of the exemptions, the period covered by the exemption would go towards meeting the requirement that the borrower be New Zealand-based.

However, the Student Loan Scheme Act 1992 contained an error whereby a borrower was treated as New Zealand-based for the period they qualify for the exemption, rather than this period contributing towards determining whether the borrower was New Zealand-based.

Key features

The new Act contains changes that ensure a borrower is treated as being physically in New Zealand for the days that they qualify for one of the exemptions. This means that the borrower must still be in New Zealand or treated as being in New Zealand for 183 days in order to become a New Zealand-based borrower and to qualify for an interest-free loan and have New Zealand-based repayment obligations.

Application date

This change applies from 1 April 2012.