October bill legislation passed

Parliament yesterday passed legislation introduced in October in the Taxation (Beneficiary Income of Minors, Services-related Payments and Remedial Matters) Bill. Royal assent is expected next week.

The legislation taxes certain distributions of trust beneficiary income to minors at 33% and makes restrictive covenant and exit inducement payments taxable. It introduces tax simplification measures to reduce compliance costs for businesses and provide relief for taxpayers in debt, and requires companies to adopt a minimum 33% RWT rate. Amongst the remedial amendments are changes to the international tax rules, the multi-rate fringe benefit tax rules, and the GST reforms enacted last year.

The new legislation will be described in detail in a forthcoming Tax Information Bulletin.