Here’s a breakdown of what you need to know:
13 March 2024 Update:
The Taxation Bill is set to increase the tax rate on trustee income from 33% to 39% starting from 1 April 2024. A two-tier system has been proposed, retaining the 33% rate for trusts with less than $10,000 income, disabled beneficiary trusts, deceased estates, and energy consumer trusts.
Complexity around marginal tax rates for beneficiaries and administrative concerns led to the abandonment of certain proposals. No specific anti-avoidance measures are in place for trusts with income below $10,000.
08 February 2024 Update:
The proposed increase in the trustee tax rate has sparked interest in restructuring to minimize exposure to the new rate. Scenarios such as altering dividend policies or distributing income to beneficiaries may raise concerns about tax avoidance.
Transferring income-earning assets to a company structure to benefit from the lower corporate tax rate is permissible but may face scrutiny in certain cases. Winding up a trust or investing in a portfolio investment entity are legitimate options. Inland Revenue highlights potential areas for scrutiny, including income allocation, dividend replacement with loans, and artificial timing alterations.
While the impending tax rate increase prompts strategic considerations, it’s crucial to ensure compliance and transparency in any restructuring efforts. Understanding permissible actions versus potential avoidance is key to navigating the changing tax landscape effectively.
Stay informed and seek professional advice to make informed decisions regarding trust taxation.
Your Outside Team
Need a bit of assistance with your business? Contact an Outside Accounting team member today and learn more about our fixed fees. You won’t regret it.
Aside from business consultation, we are business accountants Wellington who offer accounting, bookkeeping, payroll services designed to help you achieve greater financial success.
You can click here to speak to a business, accounting and bookkeeping firm. We will give you a call to know more about your needs. We will explain to you how we can improve your business.
Address: Level 2, 182 Vivian Street,
Te Aro, Wellington 6011, New Zealand
Mail: PO Box 24-457, Wellington 6142
Phone: 04 889 2975
Hiring a reliable tradesperson may seem straightforward, but finding the right fit takes careful planning. You want to ensure you’re confident in your decision, and the tradesperson feels capable of meeting your expectations. Effective research and clear communication are crucial for making this happen.
In today’s fast-paced business environment, making the right decisions is critical for achieving sustained growth and success. At Outside Accounting, we’ve seen firsthand how businesses can thrive when they avoid common pitfalls. Here are three major business mistakes and actionable tips to help you stay on the right path:
Evaluating a franchise opportunity requires careful analysis of various factors to ensure long-term success. Here are 11 essential points to consider before purchasing a franchise:
Steering a small business through economic downturns can be challenging, but these moments also present opportunities for growth, innovation, and strategic change. Deciding whether to pivot, grow, or leave the business depends on factors such as market conditions, financial stability, and personal aspirations. Here’s a guide to help you navigate tough times:
As a business owner, reviewing your financial reports each month is essential for maintaining control and steering your business in the right direction. Here are six key reasons why you should prioritize this important task.
Starting your own business is exciting, but handling all the financial details can be overwhelming. Instead of spending your time managing the books, you could focus on growing your business. This is where expert accounting firms like Outside Accounting step in.
ALL POSTS
NEWSLETTER SUBSCRIPTION