In recent news, Attorney Geoffrey Cone responded to recent coverage about foreign trust. The media coverage first made it seem like New Zealand foreign trusts consist of a sexy airport thriller that involved wealthy people, complex financial deals, and exotic lands. However, their trusts are a lot more mundane as mostly everything relating to tax is.
First of all, New Zealand isn’t a tax retreat. A tax retreat’s key characteristics include that it imposes only nominal or no taxes, the procedures or laws inhibit information exchange among other governments, and there is hardly any transparency.
New Zealand was one of the first countries on the white list for the 2002 OECD Model Agreement on Exchange of Information on Tax Matters.
New Zealand demonstrated tax transparency leadership by handling the trustees’ requirements and foreign trusts. A New Zealand trustee of a foreign trust must submit a Foreign Trust Disclosure Form (IR607) by the IRD. He/she must also maintain financial and other documents for New Zealand tax purposes, including the trust deed, details of the trust’s liabilities and assets, details of distributions and settlements, and funds the trustee spends and receives. And furthermore, the trust must maintain information about the charts, codes of account, and the accounting system if the trust carries on a business. Lastly, all records must be recorded in English and kept in New Zealand. Failure to do so will bring on heavy penalties as enacted in the world standard legislation on money laundering in 2011.
About Geoff Cone
A graduate from the University of Otago of New Zealand with a post graduate diploma in trust and tax law and with LLB honors, Geoffrey Cone entered the law field in 1980 in Auckland, New Zealand. He then relocated to Christchurch, and he became a partner of a leading law firm. He is also the Chairman of Partners there. At this law firm, he practiced tax and trust advisory work and commercial litigation.
In 1997, Cone returned to practice in Auckland, New Zealand after working for two years as a litigator in the British West Indies. In 1999, he established his own firm, Cone Marshall Limited. And its affiliated companies provide trust and trustee management services.