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WHEN WE KNOW IT, YOU’LL KNOW IT…
July 2015 txt2get wills campaign
September 2015 txt2get wills campaign -Trust Software - Capital gains tax and Trusts
The following are individual articles from our news letters you are welcome to copy and pass on. TRUST SOFTWARE AND MANAGEMENT SYSTEMS
Tactics Group Limited and TGL Trustees are pleased to announce their association with CCH for the provision of online software and trust management solutions.
CCH is part of the Wolters Kluwer Company which provides a wide range of business solutions. Wolters Kluwer is a global information services company operation in over 150 countries and provides services in the legal, business, tax, accounting, finance, audit, risk, compliance and healthcare markets.
CCH has for many years been a leader in NZ with its desk top trust management software and has just launched its cloud based system. TGL Trustees along with its associated businesses are the first users of the cloud based system.
This is designed to streamline the creation and administration of trusts and we consider it to be the leader in its field. By automating predominately manual tasks and integrating with other systems it enhances the service able to be provided to clients and improves the overall efficiency of trust administration.
We are progressively loading all of our clients onto the new system and while there will be few if any changes from the clients perspective the use of the new technology will enable more efficient and reliable management process that will benefit all parties over time.
NEW CAPITAL GAINS TAX RULES & TRUSTS
On the 1 October 2015 year new rules came into effect that have an impact on the way in which the profit on some properties sold within two years of purchase is treated and there are also procedural changes to the manner in which title changes are registered in the land registry offices. LINZ.
Essentially what is happening is that from 1 October 2015 new rules mean that the capital gain (profit) on any property that is sold within two years of purchase may be taxable. There is "main home" exemption and what is called a 2 Year Bright-line test.
The main home exemption can only be applied to one property and that has to be a qualifying property. For example a commercial farm or commercial premises do not qualify and nor does a holiday home. The exemption can only be used twice in a two year period before the current transaction seeking exemption.
"Off Shore" persons do not qualify for the exemption and nor does property owned by a trust. That does not mean property sold by a trust is automatically subject to capital gains tax as there is provision for property owned by a trust but occupied by beneficiaries to be exempted.
There is however no exemption for trusts from the process of providing an IRD number.
No IRD Number - No Conveyance of Title
For all transactions that are not exempt an IRD number is required and the transfer of title cannot be registered unless the IRD number is available.
So the new rules mean that every trust needs an IRD number regardless of the fact that it may not produce any income and its only asset is a home occupied by the persons who set the trust up.
For more information on how these changes may effect you or your trust please contact us.
If your trust does not have an IRD number, please contact us for further advice.
INFORMATION IS NOT KNOWLEDGE
BUT LACK OF IT IS CERTAINLY IGNORANCE