New Zealand Case Law: Decisions & Judgments | LexChat

Topic

Reconstruction power

Legal area

Court

16 Dec 2013

VINELIGHT NOMINEES LTD & ANOR v THE COMMISSIONER OF INLAND REVENUE CA36/2013 [2013] NZCA 655

Citation

(2013) 26 NZTC¶21
Court

Court of Appeal

The Court held Weyand was a New Zealand tax resident until the 2004 restructuring; VNL could not rely on s NF 5 because it failed to make all reasonable inquiries and lacked reasonable grounds; the taxable-activity defence was barred under s 138G as not disclosed; the four‑year time bar did not preclude RWT assessments because VNL filed AIL returns not RWT returns; the overall structure was a tax avoidance arrangement and the Commissioner lawfully assessed tax (including NRWT where applicable) without unlawful reconstruction; penalties for an abusive tax position were properly imposed.
12 Oct 2010

WHITE V THE COMMISSIONER OF INLAND REVENUE HC AK CIV 2010-404-1188

Citation

openlaw-14586e3c_8418_47f2_bf95_63e1989a7518.pdf
Court

High Court

The High Court allowed the appeal because the transactions were a legitimate use of a closely held company to employ the taxpayer and to account under the provisional tax regime, the losses that prevented payment of salary were genuine and largely unforeseen, and objectively the arrangements did not have tax avoidance as their purpose or effect or that purpose/effect was merely incidental; therefore s BG 1 did not apply and the Commissioner's amended assessments were erroneous.