A recent media coverage claims that New Zealand seems like a tax haven due to its complex financial transactions and wealthy people. However, New Zealand does not have any feature linking it to a tax haven. A tax haven is known for having complicated financial deals, impose no or nominal taxes, and disallows the interchange of tax information across governments. Considering the above grounds, New Zealand does not qualify as a tax haven. Moreover, it has always maintained its private banking industry highly transparent to adhere to the gold standard transparency model established in 2002.
The model facilitates the interchange of tax information across countries to help enact local tax laws. The 2002 OECD Tax Model listed New Zealand among the first countries to execute the globally endorsed tax laws. Upon the approval of OECD tax model, New Zealand tightened its trustee’s requirements and supported the flow of information across governments for tax purpose. After an extensive consultation with trust and tax advisors, Michael Cullen introduced new tax rules in New Zealand. Under the new regime, trustees remain subject to IRD and are required to file their financial records with New Zealand’s revenue authority. The required records include the money spent and received by a trustee, trust deed, trust’s financial position, and terms of trust settlement and distribution. Moreover, if the trust has a business, trustees are required to keep the record of its accounting system. Failure to maintain these records in New Zealand and written in English attracts hefty penalties.
About Cone Marshall
As a world-class tax and trust law firm, Cone Marshall puts up with the principles of tax and trust transparency. Located in Auckland, Cone Marshall was founded in 1999 by Geoffrey Cone and Karen Marshall. With immense knowledge in international tax laws, Karen Marshall advises legal trustee firms across the world. She worked in the London’s Commercial Litigation department for almost a decade before joining Cone Marshall.In Contrary, Geoffrey Cone has an extensive experience in planning tax and trusts models.
Since its inception in 1999, Cone Marshall assists attorneys, private banks, trustees, and family advisors located outside New Zealand in tax and trust planning. Although New Zealand was described as a tax haven in a recent article, Karen Marshall questions the assertion pointing out that New Zealand follows the agreed principles on tax standards. He also explained that New Zealand’s foreign trusts have increased due to its international recognition as a safe place for one’s assets.