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New Zealand’s anti-hybrid rules: Do you have an issue?
Published on 01 Feb 20 by "THE TAX SPECIALIST" JOURNAL ARTICLE
Like Australia, New Zealand has enthusiastically adopted a range of measures in response to the OECD’s recommendations concerning base erosion and profit shifting. Of these, the New Zealand reform that is most complex and has the greatest potential to result in unintended outcomes is the introduction of anti-hybrid rules. New Zealand’s anti-hybrid rules were enacted in June 2018 with application to income years commencing on or after 1 July 2018. This article highlights some of the differences in tax treatment between the New Zealand and Australian tax systems that may give rise to a hybrid mismatch, before considering a series of practical examples illustrating how the anti-hybrid rules may affect a range of common arrangements. As the examples illustrate, although both New Zealand’s and Australia’s anti-hybrid measures are based on the same OECD recommendations, the rules differ
in important respects and may produce unexpected consequences in some cases.
Author profiles
Chris Harker
Chris is a Senior Solicitor at Russell McVeagh in New Zealand.Current at 1 September 2014
The Tax Institute is Australia's leading professional association and educator in tax providing the best resources, professional development and networks.