The stand that New Zealand has taken about Tax Reporting

There are various stories that have been doing rounds in the media regarding the state of New Zealand when it comes to tax reporting. The stories that are making rounds make the country sound like one of those thriller movies where monies stolen from foreign countries are used to finance lavish lifestyles such as holidays in five star hotels, expensive cars and the likes, but, the reality is that New Zealand is not that kind of a country, and as a matter of fact, it is the exact opposite of such countries.

The OECD keeps a list of countries that it has listed to be tax havens; New Zealand has never been and might never become part of this list. The most common characteristic of tax havens is the fact that if they impose any taxes, they are only nominal taxes. Besides that, there is a lot of lack of transparency and the governments involved do as much as they can to limit the free exchange of information between themselves and the country looking for the information. The fact that the country does not have a secretive banking industry is enough evidence that the country is not a tax haven.

Then, there is the model agreement to exchange all information on matters related to tax, which was enforced in 2002. New Zealand was one of the first countries to make the white list by the OECD. When a foreigner wants to establish a trust locally, there is a process they have to take. This includes submitting a foreign trust disclosure form. The details that should be in the form include the trust deed, settlements and distributions details, the money received and spent details and also one’s assets and liabilities.

All these are records that should be written in English and stored within the country at all times. When these conditions are not met, heavy penalties are imposed on the trustee, which could include the loss of permission to operate within the country.

 

About Geoff Cone

The author of this article, Geoff Cone, is one of the most experienced lawyers when it comes to estates and tax laws. He started his practice in 1999 after working for various companies as a litigator. Geoff graduated from the University of Otago and had worked as a litigator both locally and abroad before starting his practice.

In 2005 he was joined by Karen Marshall, who also has a lot of experience in foreign trusts and tax laws. She became a senior partner in 2006 and together they created the Cone Marshall LLC. The company is one of the very few that deal exclusively with foreign trusts and estate taxes. The services they offer is unmatched by any other company.