Corporate Tax 2010 - BMR Advisors

Simpson Grierson
New Zealand
New Zealand
residents of the contracting states. Consequently, it is unlikely that
a non-resident company with a New Zealand branch would benefit
from a DTA between New Zealand and a third country. Having said
that, if a New Zealand branch of a non-resident company derives
income from a third country, the income will be taxable in New
Zealand only to the extent that it has a New Zealand source under
New Zealand domestic source rules (see question 6.3).
6.6 Would any withholding tax or other tax be imposed as the
result of a remittance of profits by the branch
No. No withholding tax or any other tax would be imposed as the
result of a “remittance” of profits by the branch (which is not
treated as a separate entity for New Zealand income tax purposes).
The ability to remit capital gains of a branch without any
withholding or other tax remains a relative advantage of investing
in New Zealand through a branch, rather than a subsidiary.
Extraction of capital gains from a subsidiary generally attracts
NRWT (see question 5.1).
7 Anti-avoidance
7.1 How does New Zealand address the issue of preventing tax
avoidance For example, is there a general anti-avoidance
rule or a disclosure rule imposing a requirement to
disclose avoidance schemes in advance of the company’s
tax return being submitted
New Zealand has a general anti-avoidance rule under which the
Commissioner of Inland Revenue may treat a “tax avoidance
arrangement” as void. A “tax avoidance arrangement” is an
arrangement which has tax avoidance as its purpose or effect, or as
one of its purposes or effects, not being a merely incidental purpose
or effect. There is a significant body of case law relevant to the
interpretation of the general anti-avoidance rule. The
Commissioner may also reconstruct a tax avoidance arrangement to
counteract any tax advantage obtained by a person from the
arrangement. In addition to the general anti-avoidance rule, there
are numerous specific anti-avoidance rules.
Stuart Hutchinson
Simpson Grierson
Private Bag 92518
Auckland 1036
New Zealand
Tel: +64 9 977 5063
Fax: +64 9 307 0331
Email: stuart.hutchinson@simpsongrierson.com
URL: www.simpsongrierson.com
Stuart leads our taxation practice and is one of New Zealand’s most
experienced tax lawyers with over 30 years of tax practice. He
primarily advises on investment into and out of New Zealand,
dealing extensively with cross-border taxation issues. He is a past
secretary of the International Bar Association Tax Committee and a
current Board Member of the Child Cancer Foundation New
Zealand.
Barney Cumberland
Simpson Grierson
Private Bag 92518
Auckland 1036
New Zealand
Tel: +64 9 977 5155
Fax: +64 9 307 0331
Email: barney.cumberland@simpsongrierson.com
URL: www.simpsongrierson.com
Barney is a senior associate in the tax group. Over more than 11
years of practice, Barney has accumulated a wide range of
experience in all fields of New Zealand’s domestic and international
tax law, with particular expertise in the area of structured finance.
Simpson Grierson is one of New Zealand’s leading commercial law firms with a list of high-profile clients and a strong
track record on some of New Zealand’s biggest deals. With offices in Auckland and Wellington and strong global
networks, including Lex Mundi and PRAC, Simpson Grierson is well-positioned to meet your needs.
Simpson Grierson’s taxation specialists provide advice across all areas of taxation. From national to international trade
transactions, from capital raising to infrastructure funding, from property acquisitions to divestments, we can direct you
to a solution that will benefit your business.
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