Here’s one the general public probably doesn’t know about.
New Zealand is a tax haven.
What – you are thinking, after all this stuff about us being over taxed, how can NZ be a tax haven? The answer is in our world unique trust regime. You see NZ is the only country in the world where trusts are taxed based on the setlor’s residency. Other countries determine trust residency based on trustee residency. Therefore it is possible (and if structured well) likley that a trust may not be a tax resident anywhere (thus paying no tax).
This is the case in this article.
Diep le Shaker, the prominent Dublin restaurant whose building is at the centre of a High Court action between a woman and her son, is owned by a discretionary trust in New Zealand that has no tax obligations.
A New Zealand company called Sokel owns 80 per cent of the restaurant through a complex legal structure. Sokel is controlled by a Dublin-based businessman called Matthew Farrell, who leases the premises from the ffrench-O’Carrolls.
Court documents seen by The Sunday Business Post show that Sokel is a discretionary trust and is not obliged to pay tax on its dividends. Sokel owns a company called Killardport, which in turns owns Diep le Shaker and another Dublin restaurant, the Buddha Bar.
When asked why the company’s profits were routed through New Zealand, Farrell said last week that he had ‘‘absolutely no comment to make’’.
News to some. Unfortunately New Zealanders can’t take advantage of this regime because if the setlor of a trust is a NZ resident then the trust is taxed in NZ.