Double Tax Treaties

New Zealand has double tax treaties with 35 countries (listed below). A New Zealand Foreign Trust structure can often take advantage of the low rates of non resident withholding tax deductions of 10-15%, deducted from interest, dividends and royalties sourced from any of these 35 countries.

New Zealand tax treaties identify the place of residence of the trustee as the place of residence of the trust. A New Zealand trust can therefore be used to access a total of 35 New Zealand tax treaty countries, minimising and sometimes eliminating the deduction of taxes on profits in other countries. New Zealand tax treaty partners include:

Australia, Austria, Belgium, Canada, China, Chile, Czech Republic, Denmark, Fiji, Finland, France, Germany, India, Indonesia, Ireland, Italy, Japan, Korea (Republic of), Malaysia, Mexico, Netherlands, Norway, Philippines, Poland, Russia, Singapore, South Africa, Spain, Sweden, Switzerland, Taiwan, Thailand, United Arab Emirates, United Kingdom, and United States. Higher rates of Non Resident Withholding Tax may apply to other countries.

A New Zealand offshore trust with a trustee resident in New Zealand may qualify as a resident of New Zealand for the purposes of a double taxation treaty. Tax treaties vary in the treatment of trusts and of "persons" not subject to tax in their country of residence. The New Zealand offshore trust is however considered to be "subject to tax" in New Zealand in terms of its double tax treaties. Consequently the New Zealand offshore trust could be entitled to the benefits of double tax treaties, but is not taxed in New Zealand. As all treaties are not identical professional advice must be obtained. We can assist in ensuring that the New Zealand trust can avail itself of the advantages of a particular tax treaty (for example reduced withholding tax, and no source country tax on business income providing there is no permanent establishment in that foreign jurisdiction.)

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