Inland Revenue hopes to be in a position to provide conduit tax relief in the first tax bill of 2010 for overseas investors in PIEs investing offshore.
A White Paper is expected to be released to ministers later this month followed by release to the general public, probably in August.
The tax change will mean that foreign investors will not be taxed on their international investments managed in New Zealand in PIE funds. This would remove current tax disincentives on (for example) Australian investors investing in New Zealand-based international funds.
Chapman Tripp has been working on the proposal with Appello Services for several months now and welcomes the progress which has been made.
IRD considers that it has a good understanding of the fiscal costs and risks of moving to the new regime but is seeking industry input toward building a business case and, if possible, some financial analysis.
Craig Stobo of Appello Services is collating this information and has framed a series of questions to guide respondents. Responses are required by close of business on 15 July 2009. Please refer to Appello’s blog on www.appelloservices.co.nz