Non-complying trusts

Find out the definition of a non-complying trust.

A trust is a non-complying trust if it’s not a complying trust or a foreign trust.

Non-complying trusts can be any of these.

• Trusts with a resident settlor, established overseas with non-resident trustees who earn non-resident passive income.
• Trusts settled by a non-resident person who then becomes a New Zealand resident and does not elect for the trust to become a complying trust.
• Trusts required to pay New Zealand income tax, but they have not fully paid any tax that’s owing. That is, the trust is non-complying.