What to Do With Your Trust if You’re Moving Overseas

For most people, winding up a Trust isn’t necessary. But there’s one situation where it often makes sense: **leaving New Zealand permanently.**

Why a Move Changes the Picture

When you emigrate, your Trust doesn’t just stay a New Zealand issue. It becomes subject to the laws and tax rules of your new country. That can create problems if not managed carefully.

1. Double Taxation Risks

- Some countries treat Trust income as if it were your personal income.
- Without the right planning, you may pay tax twice—once in New Zealand, and again overseas.

2. Compliance Issues

- Different countries have their own disclosure rules for foreign trusts.
- You may be required to file detailed reports or face penalties.

3. Trustee Complications

- If trustees live in different countries, managing the Trust can become impractical.
- Decisions may be challenged if the Trust is seen as no longer New Zealand resident.

Common Destinations

**Australia:**
- Very strict rules on foreign trusts.
- In many cases, winding up or restructuring is necessary before moving.

**United Kingdom:**
- Complex inheritance and capital gains tax rules.
- Some trusts may trigger unexpected tax charges if not reviewed early.

**United States:**
- US tax law treats foreign trusts unfavourably.
- Detailed reporting is required, and penalties can be severe.

What You Should Do

- **Don’t rush to wind up.**For some clients, restructuring is sufficient. **
- **Get specialist tax advice in the country you are moving to early.** Ideally, before selling assets or moving funds.
- The right structure depends entirely on where you’re going.

The Bottom Line

A permanent move overseas is one of the few times when winding up a Trust may be the best option. But it’s not automatic—you need clear advice tailored to your destination.

📖 **Next step:** Contact us to book a **Trust Check**. We’ll review your Trust and work with your international tax experts to make sure you arrive overseas with your wealth protected.

Disclaimer: This blog is general information only, not legal advice. The decision to wind up a trust has serious implications, including potential loss of asset protection and tax consequences. Please seek professional advice for your situation before taking any action.