For any country, working out the most appropriate method of taxing its residents’ interests in foreign investment funds poses difficult challenges of regime design. Unlike some problems of tax design, the optimum structure of a foreign investment fund regime is likely to vary with the size of the economy of the country in question.This article compares selected features of the foreign investment fund regimes of Germany and New Zealand, respectively a relatively large economy and a relatively small economy. It addresses the taxation of tax residents investing in investment funds based in foreign countries. In this context, the taxation of (or, more precisely, the calculation of the income of) foreign investment funds themselves is relevant, because countries’ foreign investment fund regimes typically tax their resident investors on an accrual basis. The article outlines the foreign investment fund regimes of New Zealand and Germany. It describes calculation methods for determining income derived from a foreign investment fund and identifies problems in the context of the purchase and sale of shares. Finally, the paper deals with the establishment of a flat capital gains tax for individuals (Abgeltungssteuer) in Germany and examines the possibility of adopting similar rules in New Zealand. The structure of comparison is parallel, not serial. That is, the article does not deal with the regimes of the two countries seriatim, but in parallel, moving from one feature or concept to another and comparing the manner in which Germany and New Zealand address the issues that arise.