Starting July 1, 2017 New Zealand will implement AEOI standards as part of the second wave of member countries who have committed to the automatic exchange of information.
Summary of Amendments:
· The New Zealand reporting period for Common Reporting Standard purposes will align with the New Zealand tax year (that is, the period ending March 31st).
· The annual reporting deadline for financial institutions for each reporting period will be the following June 30.
· Starting July 1, 2017, financial institutions will be required to apply the new specified due diligence procedures for all new accounts, and begin due diligence reviews of all pre-existing accounts. The due diligence for pre-existing individual accounts that are high value accounts (generally, accounts with an account balance exceeding US$1 million) is to be completed by June 30, 2018, taking into account the following:
· The period between April 1, 2018 and June 30, 2018 is effectively a three-month grace period.
· Given the July 1, 2017 start date, the grace period will effectively allow financial institutions 12 months to complete their due diligence reviews of high value accounts.
· Importantly, any high value accounts identified as reportable during the grace period must be reported with respect to the reporting period of July 1, 2017 to March 31, 2018.
· The due diligence and reporting must also both be completed by the June 30, 2018 deadline.
· New Legislation will also require foreign trusts to disclose more information to tax authorities, and will require mandatory registration with the Inland Revenue. Such information to be provided at registration will result in substantial disclosures of information pertaining to the foreign trust.