In May 2015 officials released an issues paper with respect to New Zealand’s non-resident withholding tax (NRWT) rules. The paper proposes changes to deal with perceived deficiencies in the rules particularly with respect to related party cross-border transactions.
This article looks at the case of HC Services Ltd v Commissioner of Inland Revenue [2014] NZHC 1169, (2014) 26 NZTC 21,071. The case exposes a conceptual error in the legal logic of the taxpayer’s case and sets out clearly the relationship fraud has to the creation of legal rights and obligations generally and the application of the general anti-avoidance provision in particular. The article explores the options of the victim.