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A foreign exemption trust is:

  • A foreign trust that has one or more trustees who are New Zealand tax residents, and
  • Includes trust for which the trustee uses, or has previously used, the foreign sourced income exemption in Section HC 26 of the Income Tax Act 2007

We refer to these trusts as New Zealand foreign trusts (NZFT).

If there are multiple New Zealand resident trustees, we refer to the one who communicates with us on behalf of the NZFT as the 'contact trustee'.

For the NZFT to receive a tax exemption for foreign-sourced income, the contact trustee must:

  • register the NZFT with us
  • comply with ongoing disclosure and annual return processes. 

The information in this section is a general summary of the tax obligations for NZFTs. You can find more information in the 'Special report on foreign trust disclosure rules' on our policy website.

Special report on foreign trust disclosure rules (Tax Policy)

Registration requirements

Foreign exemption trusts (NZFTs) must apply for registration within 30 days of either the trust's:

  • establishment date, if starting with a  New Zealand resident trustee
  • appointment of a New Zealand resident trustee.
  • income tax due date for the return which the trustee takes a tax position that the foreign income of the trust is exempt under section HC 26 of the Income Tax Act 2007

NZFTs with non-professional  trustees may have more time to register if all trustees are:

  • natural persons
  • not professional trustees
  • being appointed as trustees of their first foreign trust.
Last updated: 15 Apr 2024
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