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Inland revenue has released a Special Report regarding the increased tax rate. The report outlines the new rules for trusts including: References:
With limited exceptions the trustee tax rate has increased to 39% effective 1 April 2024. Note that for deceased estates: For disabled beneficiary trusts: For more information see Trust and estate changes. References: Tax Bill receives assent (ird.govt.nz)
The Taxation (Annual Rates for 2023-24, Multinational Tax, and Remedial Matters) Bill has had its third reading and now awaits assent. One aspect of the increased trustee tax rate will be the application to testamentary trusts that cannot be fully distributed in the permitted time-frame. While many estates are administered efficiently and without tax implications. … Continue reading
The Taxation (Annual Rates for 2023-24, Multinational Tax, and Remedial Matters) Bill (the Bill) has been amended by the inclusion of: As noted in the commentary to the Bill: References:
Inland Revenue has issued a General Article (GA 24/01) providing guidance regarding how Inland Revenue might perceive certain transactions and structure changes. In GA 24/01 Inland Revenue provides high level guidance regarding specific transactions and structural changes that are unlikely to be considered tax avoidance (without artificial or contrived features) such as distributions of income … Continue reading
Interpretation Statement IS 24/01, which updates and replaces IS 18/01 explains the taxation of trust under the trust rules in the New Zealand Income Tax Act 2007. The statement provides guidance on matters including: IS 24/01 does not address the change to the trustee tax rate from the current 33% to 39% that has been … Continue reading
Inland Revenue has issued an updated exposure draft regarding the taxation of trusts that will replace the current IS 18/01. The exposure draft, which has a consultation period ending 13 October 2023 is a general guide as to how income derived by the trustees and beneficiaries of a trust is taxed. The exposure draft also … Continue reading
The Government has announced its intention to align the trustee tax rate with the 39% top personal rate effective 1 April 2024. A limited exemption is proposed for deceased estates. The following commentary from the Taxation (Annual Rates for 2023–24, Multinational Tax, and Remedial Matters) Bill also explains the proposed exemption for trusts settled for … Continue reading
Inland Revenue has reviewed information from the returns filed to meet domestic trust reporting obligations and has identified a number of common reporting errors including: Trust returns with any of these errors must be amended. This can be done through the software packaged being used or in myIR. See Additional reporting requirements References:
The reporting requirements for domestic trusts (and estates) that derive a small amount of income but have not (or cannot register as non-active pending an increase in the non-active limited introduced by the Taxation (Annual Rates for 2022–23, Platform Economy, and Remedial Matters) Bill (No 2)) have been varied so that such trusts and estates … Continue reading
Matters of Trust 