Gidday Stranger

5 May

I feel like a stranger to my own blog but will try to find the time to share some info I have come across that I find of interest.  Today’s snippet is from NZ Legislation: Disclosures and relates to the taxation changes coming up in July.  I don’t know if this is to be brought in or has been superseded so I have to do some more research.  I hope it is to be implemented.  I do wonder the impact though on the likes of the Southland Outdoor Stadium Trust.  I don’t feel right with ICC and others ‘saving’ the trust and this raises the issue, for me, whether their non compliance could be creating another creditor for the Trust.  I like that there are to be some effects from not being compliant (I’ve underlined what I’m referring to).

Charities deregistration

New rules are proposed which set out the obligations of a deregistered charity when it ceases to derive exempt income as a result of being deregistered. A deregistered charity is an entity which is removed from the register of charitable entities. These new rules set out a method for establishing the initial tax base of the entity at the time it ceases to derive exempt income.

 

The rules also prescribe how to determine the date from which the entity will no longer be deriving exempt income. Entities which have been compliant with their constitutions and other information supplied at the time of registration will only be liable for tax prospectively. Entities which have not been compliant with these documents will face tax liabilities from the time they ceased to comply with the documents.

 

The rules also impose new requirements with respect to any assets and income a deregistered charity may have accumulated before it was deregistered. The entity will be taxed on the accumulated assets it still holds 1 year after it ceases to derive exempt income if it has not distributed those assets for charitable purposes during that year. Assets, excluding money, which were gifted to the entity while it was deriving exempt income will not be taxed.

I wonder if the Trustees have done any good?

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