Tax & AccountingJuly 01, 2022

Trusts - IR disclosure and reporting requirements

Most trustees of New Zealand domestic trusts are required to prepare financial statements and provide additional information with their income tax returns from the 2021/22 income year.

Trustees will be required to provide to Inland Revenue:

  • A statement of financial position setting out the assets, liabilities, and net assets of the trust
  • A statement of profit or loss showing income derived, and expenditure incurred
  • The nature and amount of any settlement made on the trust during the year
  • The details of anyone who is a settlor of the trust
  • The amount of any distributions made during the year, and the details of the beneficiary who received the distribution
  • Details of any person who has powers to appoint or remove trustees and beneficiaries or amend the trust deed

Additional requirements apply to trusts with income of $100,000 or more. Such trusts must apply the principles of accrual accounting and include the following with their income tax returns:

  • A statement of accounting policies
  • Comparable figures
  • A reconciliation
  • A schedule of fixed assets and depreciable property
  • Information about associated person transactions

Smaller trusts (or "simplified reporting trusts") do not have to comply with these additional requirements. A simplified reporting trust is one that has:

  • Income of less than $100,000
  • Deductible expenditure of less than $100,000
  • Total assets of less than $5 million
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