Digital Services Tax for NZ?
In June 2019 the Government stated its preferred approach to wait for OECD to develop its multinational solution to change the taxing rules for digitised companies, “but it will seriously consider a digital services tax (“DST”) if the OECD cannot make sufficient progress this year.” It was estimated that...
Tax treaty implications for various Covid-19 issues
The OECD Secretariat issued a short paper on 3 April analysing various tax treaty issues arising from government imposed travel and ‘lock-down’ requirements as a result of Covid-19. Here is a summary of the Covid-19 tax treaty issues:Permanent establishment (PE)• An employee may have temporarily relocated from their usual...
Transfer Pricing Documentation – fit for purpose?
Ensure your New Zealand transfer pricing documentation is fit for purpose Changes made last year to New Zealand’s transfer pricing rules are now in force for many taxpayers. Below is a short checklist: When does the new legislation first apply from? For balance dates beginning on or after 1 July 2018. Balance...
Transfer Pricing & Covid-19
Since writing out our last insight (an update on BEPS 2.0) the world finds itself faced with significant change and substantial economic challenges. Whilst businesses are working on Covid-19 economic action plans, it is important to ensure that a review of the group's existing transfer pricing is included. Some...
Update on BEPS 2.0
We previously outlined an overview of how OECD’s ‘Pillar 1’ and ‘Pillar 2’ initiatives (together referred to as BEPS 2.0) would work (see Nov 2019 article). Subsequently, OECD/G20 has provided an update of the BEPS 2.0 project (OECD Statement) and OECD recently made a public webcast. This article provides an update on...
‘BEPS 2.0’ will not be a windfall for New Zealand
BEPS 2.0 will not be a windfall for New Zealand. The OECD estimate that their latest international tax proposals will reap US$100b additional tax in aggregate for all countries. These initiatives arise from a reallocation of some group profits away from low tax jurisdictions into higher taxing countries, like...
New Zealand is out of sync with OECD’s new guidelines on financial arrangements
OECD’s recently released “Transfer Pricing Guidance on Financial Transactions” (OECD Report) is a welcome addition to the OECD Transfer Pricing Guidelines. See our summary of the report (TPTS summary). The lack of any definitive guidance on pricing related party loans and guarantees has long been frustrating for many taxpayers with investigations and disputes...
OECD releases its guidelines for pricing financial transactions
OECD has just released its long-awaited guidelines for pricing financial transactions (OECD report). The report is intended to form a new chapter X to the OECD transfer pricing guidelines. This report broadly covers: Intercompany loans Guarantees Treasury functions Cash pooling Captive insurance We summarise below some of the key matters raised in the report as concerns...
Starting a business in Australia? Don’t give most profits to the taxman!!
Recently, we have had many requests to advise on New Zealand companies starting a business in Australia. It’s certainly good to see New Zealand companies expanding their business offshore. We have highlighted below some of the issues to consider. We find that many companies rush to establish an Australian...
Inland Revenue’s Multinational Compliance Focus & other OECD developments
Welcome to our Tax Insights for November where we cover a range of recent international tax developments (concentrating on Inland Revenue's Multinational Compliance Focus) that may be relevant to your business. We trust you will find them informative. Please feel free to contact our Partners Mark Loveday or Ranesh...