This tag is associated with 5 posts

Notional income knocked back

The High Court decision in Broadbent v Ministry of Social Development, which is essentially a test case, considers whether income derived from gifted assets (sometimes referred to as notional income) can be taken into consideration for income assessment purposes. The general purpose of the Social Security Act 1964, which includes provisions relating to a wide range … Continue reading

Gift it or lose it

In 2004 Mr Wheeler sold over $2.4m of assets owed by him to a trust he settled.  The trustees were Mr Wheeler and his accountant Mr Lindsay.  The purchase price for the assets sold to trust was left as a debt owing to Mr Wheeler.  Between 2004 and 2010 five gifts of $27,000 were made … Continue reading

Trusts and residential care subsidies

Approximately 19,000 New Zealanders in long-term residential care receive a residential care subsidy (RCS), that is financial assistance with long-term care once a person is no longer able to be cared for at home.   To qualify for a RCS a person must first be able to show a limited level of assets.  However, if a … Continue reading

Tests of solvency for gifting purposes

Gifts made when insolvent can be voided, that is the gift is reversed.   This means that if a person is bankrupted any gifts made within the 2 years prior to bankruptcy are voidable as against the Official Assignee (this means that any gifts must be paid back to the bankrupt’s “estate” and can be used … Continue reading

Response to “Experts urge gifting caution”

The Sunday Star Times (27 November 2011, D4) questions whether trust professionals are “urging people with family trusts to continue gifting at $27,000 a year despite the abolition of gift duty … to bolster their own profits.” Jonathon Cron of New Zealand Trustee Services is quoted as saying that “compliance saving [as a result of … Continue reading