Non-active trusts

Form IR633 (download here) should be completed when a complying trust has met all of the following conditions for an entire tax year:

1. It hasn't derived or been deemed to have derived any gross income from any source.

2. It has no deductions.

3. It has not been party to, or continued with, any transactions with assets of the trust that give rise to any of the following during the tax year:

   1. Income or deemed income in any person's hand.

   2. Fringe benefits to any employee or former employee.

43B of the Tax Administration Act 1969 provides:

(3) In determining whether a trust complies with the requirements of subsection (2), no account shall be taken of any—

(a) reasonable fees paid to professional trustees to administer the trust; or

(b) bank charges or other minimal administration costs totalling not more than $200 in the tax year; or

(c) interest earned on trust assets in any bank account during the tax year, to the extent to which the total interest does not exceed $200; or

(d) insurance, rates, and other expenditure incidental to the occupation of a dwelling owned by the trust and incurred by the beneficiaries of the trust.

You will need:

1. The trust details and IRD number.

2. The balance date normally 31 March.

3. The tax year that the trust met the criteria for being a non-active trust.

 After you finish, please print, sign, and post the completed form to the Inland Revenue address on the form.

Keep a copy of this form for your records.

If the trust has made a declaration and stops meeting any of the criteria deeming it non-active it must notify the Commissioner that it is no longer a non-active trust and is therefore required to file annual income tax.