Find out as much as possible about the arrangement before you enter into it.
Does the transaction have a ruling from Inland Revenue?
Rulings provide certainty of how the Commissioner will treat the transaction. If you are considering getting a ruling it is important that you provide us with all relevant facts. Once you have, a ruling is generally completed within three months of the request. If there is no binding ruling for the transaction, ask why not. You could also seek a private ruling. We do charge for doing a ruling, however the cost is much less than the downside of being investigated.
Does the arrangement have a prospectus or disclosure statement?
If not, why not? Disclosure requirements are designed to provide information to investors so that you are making a fully informed decision.
Seek independent advice from a professional adviser who isn't involved with the arrangement
Many tax products we have seen provide tax or legal opinions from the promoter or one of their close associates. Often these opinions contain conditions or assumptions about the actual facts of the arrangement and individual investors are not always in positions to check whether the assumptions are correct. There is no substitute for obtaining your own independent advice from a tax expert before you enter into an arrangement.
If you have information on aggressive tax planning schemes
Any information that could help us to identify non-compliance with our tax laws is helping to protect the New Zealand tax system and your community. You can give us information in confidence by:
- using our online service, or
- phoning us on 0800 225 610.
We review all information we receive and take action if necessary. We will never disclose the source of the information.
Date published: 22 Jul 2011