Trust Law Changes
Earlier this year the Government bought in some changes to Trust Law. Effectively this hasn’t affected the tax side of things, rather it is around providing further information and therefore giving transparency to empower and help improve the rights of beneficiaries.
Going forward more information has to be provided about a Trust’s
When completing tax returns Trusts are now required to supply additional details to Inland Revenue of the financial summaries from both the Profit & Loss and Balance Sheet. These reports detail the following information:
Details of the Settlors and Settlements, Beneficiaries and Distributions and Person with Power of Appointment must be provided as follows:
What does all of the above really mean for you? Well it may mean you have to spend more time gathering and collating information to provide to us as your accountant. While we have a lot of this information to hand, we may have to gather further information from you when we start preparing your accounts so do not be surprised if we ask more questions.
The rules apply to all Trusts, there are some exemptions such as non-active trusts, charitable trusts and foreign trusts.
Is it time to review your trust structure and ensure that it is working to give you the best results and protect those assets you have worked hard for? If you haven't looked at your Trust structure for sometime we recommend that a meeting with your lawyer, ourselves and yourself be arranged.
Going forward more information has to be provided about a Trust’s
- Earnings
- Settlements and settlors
- Beneficiaries and distributions, and
- Persons with powers of appointment
When completing tax returns Trusts are now required to supply additional details to Inland Revenue of the financial summaries from both the Profit & Loss and Balance Sheet. These reports detail the following information:
- Net profit or loss before tax
- Any tax adjustments and
- Any Untaxed realised gains and receipts
- Assets -including, financial arrangements, land & buildings, shares/ownership interests and total assets
- Liabilities – including, financial arrangements and total liabilities
- Equity – breaking down the owners equity, drawings, current account balances and movement in beneficiary accounts
Details of the Settlors and Settlements, Beneficiaries and Distributions and Person with Power of Appointment must be provided as follows:
- Full Name
- Date of Birth or commence date (for non-individuals)
- Jurisdiction of tax residency
- IRD number or other Tax Identification number if not an NZ resident
What does all of the above really mean for you? Well it may mean you have to spend more time gathering and collating information to provide to us as your accountant. While we have a lot of this information to hand, we may have to gather further information from you when we start preparing your accounts so do not be surprised if we ask more questions.
The rules apply to all Trusts, there are some exemptions such as non-active trusts, charitable trusts and foreign trusts.
Is it time to review your trust structure and ensure that it is working to give you the best results and protect those assets you have worked hard for? If you haven't looked at your Trust structure for sometime we recommend that a meeting with your lawyer, ourselves and yourself be arranged.
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