Comments on the Issues Paper on the tax treatment of trusts under the New Zealand-Australia tax treaty must be received by March 1, 2021.
New Zealand’s Inland Revenue Department on December 18 published an Issues Paper on the tax treatment of trusts under the New Zealand-Australia tax treaty.
The Issues Paper examines if a trust can access the benefits under the tax treaty and how residency is determined for a trust. It then explores the tax treaty’s accommodation of trusts as fiscally transparent entities to understand exactly what that means in the Trans-Tasman context for both trustees and beneficiaries.
Finally, there is an analysis of the credit allowance provisions that provide relief for tax paid in the other jurisdiction.
Submissions are invited on the tentative conclusions reached in the issues paper which explores areas where there has been little public guidance to date. Comments must be received by March 1, 2021.
The author is Alex Hunter, Editor, TP News. He oversees and updates the publication and also regularly writes news stories about transfer pricing and international tax law. Alex is reachable at editor@transferpricingnews.com