The government will fund the return of the bodies of all New Zealand soldiers buried overseas since 1955, it's been announced.

Since 1971, government has paid for the repatriation of troops killed while serving and buried outside of the country.

But when that policy was introduced, it didn't apply retrospectively to 1955 - the year the policy became for families to pick up their own bill.

The previous government offered to pay for the return of those killed in Malaysia and Singapore during that gap and, on Wednesday, Defence Minster Ron Mark announced it would extended to all troops.

That would include those buried in Fiji, American Samoa, Britain and the Republic of Korea since the start of 1955.

The bill for the policy would be up to $7 million, Mr Mark said.

"Many families could not afford to bring their loved ones home and this caused pain and heartache," he said.

"The New Zealand Defence Force are contacting families to discuss the next steps."

If any relatives did not wish to repatriate a body, the government would continue to maintain current overseas memorials, he said.

The returning of soldiers is planned to begin in May and finish by October.

The government would also stump up $1000 towards memorials for those being repatriated, Mr Mark said.

Prior to 1955, Kiwi soldiers were interred overseas.