43B Non-active trusts may be excused from filing returns

(1)

A trustee of a trust is not required to furnish a return of income for the trust for a tax year if—

(a)

throughout that tax year; the trust is—

(i)

a non-active trust; and

(ii)

a complying trust as described in section HC 10 of the Income Tax Act 2007; and

(b)

a trustee of the trust has made and furnished to the Commissioner, in a form approved by the Commissioner,—

(i)

a declaration that the trust is a non-active trust, and that it will notify the Commissioner if it stops being a non-active trust; and

(ii)

a statement of such other matters as the Commissioner may require; and

(c)

the trust has not since the making of the declaration stopped being a non-active trust.

(2)

For the purposes of this section, a trust is a non-active trust for a tax year if, throughout that tax year, the trustee of the trust—

(a)

has not derived or been deemed to have derived any income; and

(b)

has no deductions; and

(c)

has not been a party to or perpetuated or continued with any transactions with assets of the trust which, during the tax year,—

(i)

give rise to income in any person’s hands; or

(ii)

give rise to fringe benefits to any employee or to any former employee.

(3)

In determining whether a trust complies with the requirements of subsection (2), no account shall be taken of any—

(a)

reasonable fees paid to professional trustees to administer the trust; or

(b)

bank charges or other minimal administration costs totalling not more than $200 in the tax year; or

(c)

interest earned on trust assets in any bank account during the tax year, to the extent to which the total interest does not exceed $200; or

(d)

insurance, rates, and other expenditure incidental to the occupation of a dwelling owned by the trust and incurred by the beneficiaries of the trust.

(4)

Where at any time any paragraph of subsection (2) ceases to apply to a trust for which a declaration under this section has been made, a trustee of the trust must notify the Commissioner that the trust has ceased to be a non-active trust.

(5)

Despite subsection (1), trustees of a non-active trust shall furnish a return of income if required by the Commissioner to do so.

Section 43B: inserted, on 16 November 2015, by section 21 of the Taxation (Bright-line Test for Residential Land) Act 2015 (2015 No 111).