At first sight, New Zealand exudes the aura of a tax haven to most individuals. The panoramic views of exotic destinations are too enticing to ignore. However, it is high time to address such myths. The OECD recently released a list of tax havens in the world. Surprisingly, New Zealand does not feature in the list.
Geoffrey Cone, a prominent tax attorney, demystifies this popular belief. Tax havens are characterized by several discrepancies. For instance, they possess inadequate legislation regarding exchange of information. In addition, government institutions fail to conduct transparency within official transactions. Such systems fail to impose a tax on foreign income.
A close analysis of the country’s financial sector reveals a different outcome. For starters, the state does not possess any of the above markers associated with tax havens. New Zealand prides itself in implementing stringent laws regarding foreign trusts. Such laws have made the country a role model to neighboring States. For instance, local recipients of foreign trusts are required to submit a Foreign Trust Disclosure Form. This written agreement is presented for the purpose of filing tax on income received.
How the System Works
Once issued with a disclosure form, recipients are obliged to provide details of distribution and settlements. Moreover, they ought to submit particulars of the trust’s liabilities and assets. It is advisable to keep a record of the accounting system for future reference. Moreover, such details are recorded in English and stored in the State. Failure to abide by these laws attracts hefty penalties.
The State possesses 39 double tax contracts. To most, these may seem as bloated legislation. However, such agreements aid in the prevention of fraud. To achieve this, such contracts reduce tax obstacles experienced in investments.
New Zealand has collaborated with various nations to implement tax reforms. Such improvements strengthen double tax agreements on foreign trusts. Furthermore, the country participated in a multilateral Convention on Mutual Administrative Assistance in Tax Matters. Several factors have stimulated an increase in foreign trusts recorded in the country. For instance, political stability, a safe business environment and strict laws have contributed to such records.
Geoffrey Cone in Brief
Mr. Cone is a reputable tax and trust counselor in New Zealand. He serves as the Managing Partner of Cone Marshall Ltd. Based in Auckland, the firm specializing in offering tax services to high net worth individuals and Fortune 500 companies. The company is staffed by a team of competent professionals that promote efficient service delivery to satisfy clients.
Mr. Cone is a specialist in financial planning in the State. He offers his services to clients in Spain, Italy and Latin America. During his free time, Geoffrey loves to unwind at the Cones Camp with his wife. The 2.5 ha property is an excellent retreat coupled with a serene environment and a luxurious house.