Managed investment trusts to access income benefits from trans-Tasman tax treaty
Australian managed investment trusts (MITs) will be able to access treaty benefits on income from New Zealand under the new tax treaty signed between Australia and New Zealand.
Listed MITs and MITs with more than 80 per cent of interests held by Australian investors will be entitled to treaty benefits on all income from New Zealand.
The treaty also provides that dividends, royalties and interest paid from one country to a resident of another country will have limits on the chargeable tax amounts. The existing treaty has a 15 per cent withholding tax rate limit for all dividends.
Cross-country pensions will also be exempt from taxes to the same extent that they are in their country of origin, allowing super benefits to build up in both countries, while income earned during short visits to one country when the visitor has been seconded will be exempt from the taxes of the country they are earned in.
The treaty will come into force when both countries advise they have completed their domestic requirements.
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