New Zealand is well known to most readers and requires little introduction. It is a safe, stable and secure country which offers considerable benefits to those involved in international tax planning.
If properly structured, a New Zealand resident company can operate as a tax free offshore company.
New Zealand resident companies are usually taxable. A New Zealand Special Purpose Company, however, which is structured as the Trustee of a non-resident New Zealand Trust is not taxable.
The Trust and its beneficiaries are also non-taxable, except on income with a New Zealand source. If the New Zealand company and Trust have no connection to New Zealand, the complete structure is non-taxable in New Zealand.
The company owner and trust beneficiary may be the same person. Once incorporated, the company is generally free to do business, open bank accounts, or invest anywhere in the world. In effect, it can operate as a tax free offshore company but without the “tax haven” implications of the traditional offshore centres.
In addition, it benefits from the asset protection features of the trust, as funds may be moved into and out of the trust as required. The complete structure costs a little more than the traditional offshore company but with far superior features.
The structure is quick and simple to establish. The only connection with New Zealand is that it will be a New Zealand resident company with a New Zealand registered office.