IR has released three items for comment which have tax avoidance as their subject matter.
The first is PUB00305 titled ‘Tax avoidance and the interpretation of the general anti-avoidance provisions sections BG 1 and GA 1 of the Income Tax Act 2007’ which sets out to explain the Commissioner’s view of the law on tax avoidance in NZ, and upon finalisation will replace the current interpretation statement IS 13/01 – ‘Tax avoidance and the interpretation of ss BG 1 and GA 1 of the Income Tax Act 2007’.
You may also recall a number of QWBA’s issued by IR in 2014/2015 which commented on various scenarios and whether IR considered that tax avoidance arrangements were in existence. Once PUB00305 is finalised, QB 14/11, QB 15/01 and QB 15/11 will also be withdrawn, on the basis that they either no longer reflect the Commissioners approach or subsequent legislative changes have now outdated the original QB.
However to the extent that the previous scenarios still have relevance, the QB’s have now been updated and also released for comment as drafts:
- PUB00305 QB 1: ‘Income tax: scenarios on tax avoidance – reissue of QB 14/11 scenarios 1 and QB 15/11 – scenario 2’; and,
- PUB00305 QB 1: ‘Income tax: scenarios on tax avoidance – reissue of QB 15/11 – scenarios 1 and 3’.
It should be noted that the scenario updates have not resulted in any changes to the previous conclusions reached by IR.
Should you wish to make a submission with respect to any of the 3 items, 18th February 2021 is the cut-off.
And just as a side, if you keenly follow tax avoidance cases through the Courts, the Supreme Court has granted both Frucor and the Commissioner leave to appeal the Court of Appeal’s decisions, so it’s not over yet.