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Tax Scorecard

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Match 1AUSTRALIA
NEW ZEALAND
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Currency and Rate / $

Australian Dollar (AUD) AUD / USD = 1.29

New Zealand Dollar (NZD) NZD / USD = 1.32

Tax Year

30 June 

1 April to 31 March 

RoI Filing Due Date

15 January for corporates, 31 October for individuals 

31 March the year following balance date with the exception of companies with 31 October to 31 December balance date, in which case the due date is 31 March subsequent to following year. These filing dates apply provided the company is linked to a 'tax agent'. If not linked to a tax agent, returns are due by 7 June following balance date, or 7th day of 4th month following balance date for April to September balance dates. 

Residential Status
- Individuals

Person residing in Australia and includes who meets either one of the following conditions : he or she is domiciled in Australia unless the tax authority is satisified that the person's permanent place of abode is outside Australia , he or she is present in Australia continuously or intermittently for more than half of the tax year unless the tax authority is satisified that the person's usual place of abode is outside Australia and that the person does not intend to reside in Australia. 

An individual is a resident in New Zealand if

- he has a permanent place of abode in New Zealand, regardless of whether he also has a permanent place of abode in another country; or

- he is present in New Zealand for more than 183 days in any 12-month period. Residence begins with the first day of such a period of presence in New Zealand. 

- Corporates

Corporations incorprated in Australia ; corporations carrying on business in Australia with either their central management and control in Australia or their voting power controlled by Australian residents 

A company is considered to be resident if it is incorporated under New Zealand law. Companies incorporated under foreign law are considered to be resident if they are effectively managed from New Zealand. Resident companies are taxed on their worldwide income. Non-resident companies are taxed only on their New Zealand sourced income. 

Tax Rates
- Individuals

Progressive rates from 0% to 45% 

10.5% (first NZD 14000)

17.5% (NZD 14001 to 48000)

30% (NZD 48001 to 70000)

33% (NZD 70000 and above) 

- Corporates

30% 

28% 

Withholding Tax Rates
- Royalty

30% 

15%

- Fees for Technical Services

0% 

N/A

- Dividends

30% 

Typically, 15% (fully imputed dividends, fully dividend withholding payment credited dividends, supplementary dividends, investment society dividends);

0% (non-cash dividends);

30% (all other dividends) 

- Interest

10% 

15% (if paid to non-associated persons) 

OECD Status

Member 

Member

No. of Treaties

50 

37

Treaty with India

Yes 

Yes

Advance Ruling

Yes, Rulings may be obtained on a broad range of tax issues relating to income tax, Medicare levy, fringe benefits tax, withholding tax, GST, luxury car tax, excise duty and the administration and/or collection of taxes 

Yes. New Zealand Inland Revenue issues both binding and non-binding rulings on tax issues. Binding rulings can be either public or private rulings. 

GAAR

The general income tax antiavoidance regime plays an important role in complementing specific antiavoidance rules. Applies when it is determined that the dominant purpose of the parties entering into a scheme was to enable the taxpayer to obtain a tax benefit; the tax benefit may be denied and significant penalties may be imposed. The amendments apply with respect to schemes entered into on or after 16 November 2012. 

Mix of general and specific anti-avoidance rules. Under the general anti-avoidance rules, transactions are void if they the purpose and intention of New Zealand's tax laws (i.e. have more than incidental purpose or effect of tax avoidance). 

CFC Legislation

A foreign company is a CFC if five or fewer Australian residents hold at least 50% of the company or have de facto control of it, or if a single Australian entity holds a 40% interest in the company, unless it is established that actual control does not exist. The tainted income of a CFC is attributed to its Australian resident owners, which are required to include such income in their assessable income. Whether an amount earned by a CFC is attributable to Australian residents depends on the country in which the CFC is resident. The CFC rules identify “listed countries,” which have tax systems that are considered to be closely comparable to the Australian system. All other countries are “unlisted countries.” Certain amounts are unconditionally attributed regardless of whether the CFC is resident in a listed or unlisted country. If a CFC resident in a listed country fails the active-income test, its attributable income includes “adjusted tainted income,” which is eligible designated concession income prescribed by the regulations on a country-by-country basis. 

Yes. There is no requirement to attribute income of a foreign subsidiary unless the CFC derives more than 5% of its income from "passive" sources (eg. income in the form of dividends, interest, royalties and rents). The passive income must be returned to New Zealand. 

Anti-Tax Haven

Yes, specific anti abuse rules exist such as direct and indirect value shifting rules , round robin transactions which deal with restricting deductions that are in excess of net expenditure incurred by taxpayer and their associates, streaming of dividend and capital benefits 

N/A 

Transfer Pricing

Yes

Yes. Comprehensive transfer pricing regime based on OECD Transfer Pricing Guidelines and the 'arm's length' principle. 

Safe Harbour

Yes

N/A 

APA

Yes

Yes 

Indirect transfer taxation

Yes

N/A

Indirect Tax Regime

GST

GST

- Applicable Rate

10%

15% (Standard), 0% (reduced) 

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Landmark Years in Cricket & Tax !

What better way to set the stage for a special occasion than to take a trip down memory lane and refresh our memories on landmark developments in both the Cricketing and Tax World! This Nostalgia trip takes us back to the days of ‘Lagaan’! Can you’ll guess when was the first test match played and where? Would some of our younger readers know when the organisational structure of the Income Tax Dept and the Central Board of Revenue was created and by which Act? In this very special presentation by the Taxsutra editorial team, we take a blow by blow look at the Landmark years in Cricket & Tax and what made them so.


The Tax Spin Highlights

India – Australia Tax Pitch, ICC & Tax, Mohan Parasaran’s cricket picks, Mega Quiz prize - Chaturvedi and Pithisaria & more…. 

Anyone who watched the first semi-final yesterday would agree that cricket indeed was the winner. It reminded us once again why cricket is a game of glorious uncertainties…and there were one too many at Auckland. The dropped catches, missed run outs, unexpected intervention of weather Gods and the emergence of the most unlikely hero – Grant Elliot! And no, South Africa did not choke! They showed us why cricket is still a gentleman’s game. Not an inch conceded on the pitch but emotions got the better of them after yet another heart breaking loss at the altar of the finals.

So the Kiwis are through to their first ever World Cup final and they would be itching to know who their opponents are going to be this coming Sunday at the MCG. If past is prologue, then tomorrow’s semi-final between Indian & Australia will be another cliff hanger that will ensure skipping of a billion heartbeats. The match is gonna be played at the iconic Sydney Cricket Ground but the number of supporters of Men in Blue likely to throng the stadium tomorrow, may just convert SCG into a Wankhede!

The one on one match ups lined up for tomorrow are truly mouth watering prospects : Dhoni vs Clarke, Warner vs Shami, Kohli vs Johnson… A billion people will be off from work tomorrow or at the very least, their minds would surely be wandering somewhere. Tax Spin (a Taxsutra initiative in conjunction with KPMG in India) previews this pulsating contest on its unique ‘Tax Scorecard’ where again, it’s even stevens. One area where the Aussies score over India is the CFC legislation. Click here to read more....


TBW - Tax Before Wicket!

For our cricketers, the stakes are high not just when they are on the pitch, but off it as well. Therefore it’s no surprise that cricketers are often caught in the middle of high profile tax controversies. And it is not just the cricketers but the cash rich cricket associations like BCCI & State Cricket Boards that have increasingly come in the firing line of the taxman, who is subjecting the tax exemption claims to searching yorkers in the hope of trapping them plumb before the wicket!


Taxing Sports in India - The IT Act Googlies!

We still remember the tax fiasco surrounding the hosting of the Formula One Grand Prix in India and how it ensured that India was dropped from the calendar after hosting the prestigious and popular race for three consecutive years. The Indian Income tax code may not be a minefield when it comes to taxation of sportspersons, but there is no denying the fact that the tax pitch can at times get queered by the uneven cracks! Taxsutra, in this informative piece, collates the different sections of the Income tax Act  dealing with taxability of income from awards, incentive deductions,  special tax treatment for non-resident sportspersons as also the recurring debate on taxation of international sports events in India.


* Disclaimer: KPMG in India does not bear any responsibility for any content on this microsite.