Updated tax agreement between Japan and New Zealand

03.07.2012 Governments of Japan and New Zealand have agreed an updated agreement on avoidance of double taxation from 1963. Among the key changes you should pay attention to the reduction in tax rates at the source on dividends paid, interest and royalties. Furthermore, this agreement provides a possibility of transfer dispute of taxpayer to an arbitral tribunal. As was noted in New Zealand, the updated agreement stresses the importance of Japan as the major investor and trade partner for New Zealand. Contributing to the further strengthening of economic relations and facilitating mutual investment, the new agreement is based on the existing basis of cooperation with Japan in the fiscal sphere.
Nowadays, the agreement is pending an approval and signature by both parties. The text of the document will be available after it is signed by authorized representatives of New Zealand and Japan.

Expert’s opinion

Today, New Zealand can be as alternative to many jurisdictions. Offshore veil, which imposed on the countries some non-professional recorders and high-profile showdowns in the context of not payment taxes in the country, gradually came to naught. Few know that there is income tax in the country, that should be paid regardless on the place of business.
Nevertheless, New Zealand offers to investors the best working conditions through the creation of a trust with a foreign founder. Such form allows to avoid paying taxes, while outwardly it looks like a normal company.
Renewed the agreement with Japan will allow investors to avoid double taxation, as well as save on taxes.

Lomakina Irina ( the director of Moscow office of Honest & Bright )