Approved information sharing between IRD and MBIE
An approved information sharing agreement between Inland Revenue and the Ministry of Business, Innovation and Employment (MBIE) came into effect on 1 October 2026 and gives both agencies greater access to information about compliance, enforcement and regulatory activities.
Under the agreement, a broad range of information can be shared about companies and other entities including financials, GST, compliance and enforcement, bankruptcies and liquidations, and failed entities.
This level of coordination between government departments means businesses should expect information provided to one agency to be increasingly available to another.
Double tax agreement with Croatia & Republic of Slovenia
New Zealand's double tax agreements with Croatia and Slovenia came into force on 24 September 2026. The agreements help prevent the same income being taxed in both countries and provide greater certainty for businesses and investors operating across borders. They also establish mechanisms for resolving cross-border tax disputes and reducing barriers to international trade and investment.
Standard costs for home-based services
Inland Revenue has published an updated overview of the standard costs for home-based service providers. The publication does not change the existing rates or their application, with the 2026 CPI adjustments having already been made on 18 June 2026. Instead, it consolidates the relevant guidance and rates in one place. View our earlier coverage of the rate changes.
Technical decision summaries:
- Complying trust
Inland Revenue has confirmed a trust qualified as a complying trust because the trustee was a New Zealand-resident company and the trust's income did not include non-resident passive income or non-residents' foreign-sourced income. The ruling also stipulated that the trustee must satisfy their income tax obligations throughout the life of the trust.
It's important to note complying trust status remains critical, given its impact on the tax treatment of distributions to beneficiaries.
- Restructure and the use of losses
A private ruling considered whether a group restructure involving the transfer of business assets and the use of carried-forward tax losses was allowed. Inland Revenue concluded the company could continue to carry forward its existing tax losses and use them against income generated from the newly acquired production assets. This was contingent on the 49% shareholder continuity requirement being satisfied and the relevant loss restrictions did not apply.
Inland Revenue also stated the restructure did not constitute tax avoidance as the asset transfer occurred at market value for genuine commercial purposes, involved a real transfer of economic risks and rewards, and contained no artificial, contrived or circular features.
- Sale of long-term investment properties
Inland Revenue has confirmed proceeds from the sale of long-term investment properties held by an insurance company were capital in nature and therefore not taxable.
The properties had been acquired and held long term to support the wider group's operations, were not purchased with policyholder funds or actively traded as part of the insurance business. Sufficient liquid assets were also available to meet policyholder claims. The company had no purpose or intention of disposal when the properties were acquired, and there was no evidence of a land dealing, development or investment trading business.
This means the sale of investment assets will not necessarily give rise to taxable income merely because the owner carries on a business.
Enforcement updates:
- Prison for tax evasion
A Christchurch man was sentenced to two years and three months in prison for tax evasion involving nearly $1.4 million. Between January 2023 and June 2025, his company failed to pay $778,852 of PAYE and other employee deductions and $610,005 of GST. Instead, the funds available were used for creditors, company expenses and personal purposes. Inland Revenue emphasised using unpaid tax as working capital or personal income creates an unfair advantage and undermines the integrity of New Zealand’s voluntary tax system.
- Aiding and abetting tax evasion
A South Auckland woman has been sentenced to 11 months' home detention after pleading guilty to aiding and abetting tax evasion linked to a construction labour hire business. Inland Revenue's investigation found PAYE and withholding tax returns substantially understated wages paid between October 2020 and March 2023, resulting in tax shortfalls exceeding $606,000.
Of 163 PAYE returns filed during the period, only 15 accurately reflected actual wages paid. The case emphasises Inland Revenue's continued focus on PAYE compliance and the personal consequences that can arise when false payroll information is knowingly provided.
