Description

Navigate the complexities of cross-border taxation for trusts, including key issues like dual status trusts, non-complying trusts, and the impact of changing tax residence for settlors, trustees, and beneficiaries

Key issues addressed include the tax treatment of “dual status trusts” (i.e. trusts that are both “foreign trusts” and “complying trusts”), the tax treatment of distributions from “non-complying trusts” and “foreign trusts”, and the application of the “ordering rules”.

Other cross border tax issues considered include retaining “complying trust” status when settlors cease to be New Zealand tax resident, obtaining “complying trust” status when settlors become New Zealand tax resident, the effect of changes in tax residence status of trustees and beneficiaries, and the impact of the transitional residence rules.

The special disclosure rules that apply to “foreign exemption trusts” with a New Zealand-resident trustee will also be discussed. These include the requirement for “foreign exemption trusts” to register with Inland Revenue, file annual returns and pay registration and filing fees.

ORIGINAL BROADCAST DATE

31 October 2024

LEARNING OUTCOMES

You will:

• Know the difference between “complying trusts”, “foreign trusts”, “non-complying trusts” and “dual status trusts”
• Understand how distributions from different types of trusts are taxed, including distributions from “dual status trusts”
• Learn how a trust can retain its “complying trust” status when a settlor ceases to be New Zealand tax resident
• Know how a “foreign trust” can become a “complying trust” when a settlor becomes New Zealand tax resident
• Understand what tax implications can arise where trustees and beneficiaries change their tax residence status
• Learn how the transitional residence rules interface with the rules for taxing trusts
• Understand the registration and disclosure rules for “foreign exemption trusts”, and the consequences if these rules are not complied with

SUITED TO

Intermediate and senior accountants, tax lawyers, trust lawyers and others who act as trustee of clients’ trusts.

PRESENTER

Stephen Tomlinson, Principal, Tomlinson Law.

Stephen Tomlinson is the principal of Tomlinson Law. He has lectured in taxation, finance and business law at the University of Canterbury and is a well-known presenter of taxation and trust seminars and webinars. Stephen advises accounting firms and law firms on a wide range of tax issues. He is a member of the NZLS Taxation Committee and The Law Association’s Trust Law Committee, and was a member of the Minister’s Trust Reference Group on trust law reform.