The latest media coverage over the foreign trusts in New Zealand makes the news seem more as if it is about exotic lands and wealthy people. Nevertheless, anything associated with taxes is much aligned to the mundane, and New Zealand is not recognized as a tax haven. Regions that are tax havens impose only a little or no taxes and have some degree of tax transparency. New Zealand does not adhere to such procedures.
However, the nation does not also have a secretive and big private bank sector.
Among the strategies through which New Zealand has established itself as a leader in transparency in tax, matters are in the manner it handles its foreign trusts as well as the way through which they are up to the requirements that are placed on the trustees.
All of these proceeds to the assistance of other various governments, which may lead to relevant information. As per the new rules on the same, any trustee in New Zealand of a foreign trust will be required, as per the requirements of the IRD, to submit a form of disclosure. Additionally, they will also have to maintain clean financial records for the purposes of tax. These may comprise of details of settlements and distributions, the trust deed, details of the assets and liabilities of the trust as well as any funds that the trust spends or receives. Failure to keep such accounts could result in hefty fines and penalties.
In many nations, any person settling a trust has to report the fund settlement to their own relevant revenue authorities. New Zealand boasts 39 separate double tax agreements. These agreements are in place to aid in the reduction of tax hindrances for cross-border trade and investment. They are additionally used to help in preventing tax avoidance and tax evasion. Adding to the double tax agreements, there are more than 20 exchange agreements in New Zealand for tax information with other jurisdictions. This helps by assisting in the prevention of tax evasion and tax avoidance. None of these strategies is distinctive of a tax haven.
New Zealand does not engage in competitions with tax havens. Alternatively, it interacts with other jurisdictions including the US, Singapore, and Britain whose governments all have a transparent program of the tax system. Additionally, these governments similarly employ taxation principles concerning their foreign trusts. Any matters regarding the usage of foreign trusts may be efficiently directed towards regulating our firms to ensure that they are all coherent to the same high-level standards.
Lawyer Geoffrey Cone is one of the distinguished partners at the Cone Marshall law company. The law firm works directly and closely with international advisers and families. Geoffrey Cone has successfully practiced and qualified in commercial litigation law as well as tax and trust advisory works. He has made significant appearances as a leading counsel in all levels of courts. Geoffrey Cone’s law firm is the only one in the entire New Zealand that has an exclusive specialty in the sector of international tax and trust planning. Additionally, the law company offers their wide range of clientele with trustee services as well as trust management through its other branch-affiliated companies.