Is a New Zealand foreign trust still tax free?

Foreign-source income remains untaxed in New Zealand where the settlor is non-resident and no NZ-resident beneficiary benefits. Registration and annual disclosure are mandatory.

Who can be a foreign trustee?

A New Zealand resident, in practice a licensed professional trustee company registered with Inland Revenue and subject to AML supervision.

Do I need an NZ resident director for a company?

Yes — at least one director resident in New Zealand, or in Australia while also being a director of an Australian company.

Jurisdiction · APAC

New Zealand

Foreign trusts with a genuine white-list reputation, and one-day company setup.

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Overview

The New Zealand foreign trust remains one of the few structures that is simultaneously tax-neutral for non-resident settlors and domiciled in an OECD, non-blacklisted, common-law country. Foreign-source income of a qualifying foreign trust is not taxed in New Zealand, while the trust deed sits under a first-world legal system.

The 2017 reforms after the Panama Papers imposed registration, disclosure and annual returns on foreign trusts. That killed the secrecy use case and preserved the legitimate one.

Typical use-cases

Where New Zealand fits

Foreign trusts
Holding companies
Investor residency

Banking

Banking landscape

ANZ, ASB, BNZ and Westpac NZ serve the market. Banking for foreign trusts requires a resident trustee and full disclosure of settlors and beneficiaries. Company banking requires an NZ-resident director. Standards are high but the process is predictable.

Tax

Tax & reporting

28% corporate income tax. No capital gains tax in most circumstances, no inheritance tax and no stamp duty. Qualifying foreign trusts pay no New Zealand tax on foreign-source income where the settlor is non-resident and no New Zealand-resident beneficiary receives distributions. GST is 15%.

Substance

Substance & register visibility

Foreign trusts must register with Inland Revenue, appoint a resident foreign trustee, disclose settlor and beneficiary details, and file annual returns. Companies require a director resident in New Zealand or Australia. Company registers are publicly searchable and among the most accessible in the world.

Decision

When to pick this jurisdiction

Pick New Zealand for a foreign trust that needs OECD-country credibility with tax neutrality, or for a clean, fast common-law holding company where reputation matters.

The director's view

Written up as a comparative shortlist.

Every New Zealand recommendation is delivered as a comparative memorandum — substance defensibility, banking access, treaty coverage, register visibility, cost to maintain and reputational risk — so the client can see the trade-offs before committing.

Next step

Considering New Zealand? Get a written comparison first.

Answer six questions and a director will come back with a shortlist, indicative costs and banking route.

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Frequently asked

Questions we hear on every New Zealand intake.

Is a New Zealand foreign trust still tax free?: Foreign-source income remains untaxed in New Zealand where the settlor is non-resident and no NZ-resident beneficiary benefits. Registration and annual disclosure are mandatory.
Who can be a foreign trustee?: A New Zealand resident, in practice a licensed professional trustee company registered with Inland Revenue and subject to AML supervision.
Do I need an NZ resident director for a company?: Yes — at least one director resident in New Zealand, or in Australia while also being a director of an Australian company.

Relevant services