Trust Disclosure Rules

The Inland Revenue has new information gathering powers for trusts (other than certain exempt categories, such as charitable and non-active trusts).

As part of the annual income tax return, information required to be disclosed will include:

  • Financial information, including profit and loss statements, balance sheet items, and other information to be specified by the Commissioner (for example, any transfers to the trust by associated persons)
  • Distribution, including non-taxable distribution, information, such as identity details for beneficiaries – e.g. their name, IRD number and date of birth. Inland Revenue could also require other information relating to distributions to be reported, which could include, for example, the source of the distribution
  • Settlement information, including identity information for settlors such as name, IRD number and date of birth, as well as the amount and nature of each settlement. In addition, for the 2021–22 tax return year, trustees will need to provide settlor details from prior years, if not provided to Inland Revenue already
  • Identity information on those with the power under the trust to appoint or dismiss a trustee, to add or remove a beneficiary, or to amend the trust deed

In addition, Inland Revenue will have the power to request a trustee to provide prior year information for up to seven years (i.e. from the 2014-15 to the 2020-21 income year), if it is within their knowledge, possession or control.