fin_tax_FIF: NZ FIF tax offset: NAV-neutral leverage (FDR on the whole...

In umx: Structural Equation Modeling and Twin Modeling in R

NZ FIF tax offset: NAV-neutral leverage (FDR on the whole pile)

Description

Fair Dividend Rate tax is applied to opening equity plus assets bought with loan funds.

Usage

fin_tax_FIF(
  portfolioValue = 1e+06,
  marginRate = 0.056,
  expectedReturn = 0.12,
  taxRate = 0.38,
  fifRate = 0.05
)

Arguments

portfolioValue	Opening FIF value (1 April), before the new loan.
marginRate	IBKR (or other) annual margin rate (e.g. 0.05).
expectedReturn	Expected annual return of the asset (e.g. 0.12).
taxRate	Marginal tax rate (e.g. 0.38).
fifRate	FDR deemed rate (default 0.05).

Details

Neutral loan / opening equity:

L/E = (f t) / (r - i(1-t) - f t)

When f = i (both 5%), the leftover on the loan collapses to r - i: interest deduction pays FDR on the borrowed slice, and the remaining spread pays FDR on the original book.

z = \frac{\bar{x} - \mu}{\sigma/\sqrt{n}}

LTV on the plot is loan / opening equity, not loan / total assets.

Value

A ggplot of net annual impact vs LTV. Invisibly, a list with loan, assets, ltvOpening, fdrDrag, leftoverOnLoan.

See Also

fin_value_interest(), fin_tax_NI(), fin_value_percent()

Other financial functions: fin_options_Greeks(), fin_options_LeapSimulate(), fin_options_plotGreeks(), fin_options_teach(), fin_stock_CAGR(), fin_stock_justifiedPE(), fin_stock_target(), fin_stock_ticker(), fin_stock_valuation(), fin_tax_NI(), fin_value_CAGR(), fin_value_CarryCost(), fin_value_NPV(), fin_value_interest(), fin_value_percent()

Examples

# $3.8m opening, 5% IBKR, 12% expected, 38% tax -> ~$1.03m loan, ~$4.83m assets
fin_tax_FIF(portfolioValue = 3.8e6, marginRate = 0.05, expectedReturn = 0.12, taxRate = 0.38)

umx documentation built on Oct. 11, 2026, 5:07 p.m.