Local Recovery Solidifies, While Global Uncertainty Continues

Following on from the Trust Act 2019 coming into force earlier this year, Trusts now have additional reporting obligations to the Inland Revenue from the 2021/22 tax year. The new disclosure rules have been introduced to assist the Inland Revenue in monitoring compliance with the recently introduced top personal tax rate of 39%. The new rules also provide the Inland Revenue with information on transactions they have not historically had visibility over.

In the past, trusts that have taxable income have had to file income tax returns but haven’t necessarily had to file financial statements. Inland Revenue records estimate there are 180,000 domestic trusts that have assessable income and maybe impacted by the new disclosure rules.

What Needs to be Disclose:

Financial statements including a profit & loss statement and balance sheet
Details of all settlements made on the Trust during the year including details of the person or entity making the settlement
Details of all distributions made by the Trust during the year and details of the person or entity the distribution has been made to
Details of those who have the power to appoint or remove a trustee, beneficiary or make changes to a trust deed
Any other information required by the IRD

Generally the information will need to be reported for the first time for the year ended 31 March 2022 as part of a Trusts income tax return however, the Inland Revenue also has the ability to ask for the same information for the previous eight years.

Exemptions

Trusts with no activity other than just owing a family home or holiday house maybe eligible to apply for non-active status which removes the need to make the disclosures.

What Next

Trustees will need ensure they have records readily available and to consider if the Trust has records for earlier years to enable the information to be provided to Inland Revenue if requested. Trustees should also consider if the trust should apply for non-active status to remove the reporting requirement.

For further information, feel free to get in touch.

Darren Dentling

Partner, Bendall and Cant

darren@bcca.co.nz

The latest GPD data is out, and at 0.2% growth in the last three months of 2025, it’s risen for three out of the past four quarters. We’re into annual growth for the first time since the third quarter of 2024, which is a hopeful signal that local conditions are improving.

The latest data shows solid increases in retail and accommodation sectors, finance and insurance, media and comms, and arts and recreation. Construction under performed, but data from January and February 2026 looks more positive for the sector, so overall the picture here in New Zealand is encouraging.

The looming concern is the global oil crisis, and the headlines seem alarming. But we’ve been reading some pretty frightening headlines every week since 2020, and we all just keep on going. What can you do in these uncertain times? The best advice is not to panic. If you have an investment strategy that’s taking you toward your financial goals, stay calm and talk to your adviser before you make any sudden moves. As ASB’s analysts point out, “the average conflict results in a very short-term drawdown of roughly 5% (using the S&P500 as a proxy), with the market recovering its losses over an average of 47 days.”

In the longer term, this fuel crisis might have an upside. If it encourages a faster shift to renewables, that will improve New Zealand’s energy security and make us less vulnerable to these oil shocks in future. ANZ is reporting more interest in EVs, and BYD says it’s had a bumper few weeks. The national grid reached a record high of 96.4% renewable in the latest data, a new record, so the decarbonisation megatrend is continuing its onward march here in New Zealand.

In response to the picture both here and abroad, the big banks have been nudging up their interest rates, leading to higher returns for savers. Term deposit rates are up marginally, but still below 4%. Returns on Zagga loans have also stayed steady, and have been consistently paying around 7%. We’re seeing rapid uptake on new opportunities, and we expect this continue throughout 2026 – particularly as momentum grows in the construction sector.

We’ve seen a noticeable increase in both the volume and quality of loan investments coming through this month, and we’re excited to be bringing these new opportunities to our investors. With strong demand and quick uptake on new listings, it’s important to be prepared so you can take advantage of opportunities as they become available.

Local Recovery Solidifies, While Global Uncertainty Continues

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