Plenty of law firms talk the talk about closer economic ties and the instrinsic links between New Zealand and Australia. But few demonstrate their knowledge on both sides of the Tasman.
Duncan Cotterill is one of the exceptions, having successfully established a high-powered trans-Tasman taxation team headed by Bruce Patterson (Auckland), Grant Pearson (Wellington) and Special Counsel Mike Aitken (Sydney). Patterson: "We always had our sights on the trans-Tasman tax market, because there was no one else in that space. While others have talked about closer economic relations and many a word has been written about a common heritage, few professional firms have staked out this complex area of law and regulation."
It's an impressive line-up. Patterson is regarded as a pragmatic and commercially savvy practitioner, Pearson joined the team in 2004 from an extensive consulting and tax litigation background, while the addition of Aitken, ex Minter Ellison, is a real coup and provides much needed tax dispute support in Sydney.
Pearson says that while New Zealand and Australia look much the same, it is surprising just how far apart they are from a legal and regulatory perspective. "It's a common trap; assuming life is the same on the other side. It's not!" For a start, there are the unexpected taxes.
New Zealand has a unitary system of government whereas Australia has a federal system. "New Zealanders don't intuitively understand the impact of the federal system. It can be an expensive learning process," according to Patterson.
For example, all Australian States impose significant stamp duty on property transactions and each state is different. And then there's payroll tax, duty on new cars, land tax, even a parking space levy for the owners of "liable spaces".
New Zealand has some surprises as well. Although New Zealand doesn't have a comprehensive Capital Gains Tax, it does have a selective capital gains system waiting for the unprepared. There are also fundamental differences, for example in New Zealand Unit Trusts are taxed as companies and Limited Liability Partnerships are not. Completely the opposite to Australia.
GST has the same name, but its implementation has major differences. Aitken: "There's no integration between the two systems, other than information sharing - so it's no surprise that issues arise. The ATO has no sympathy for unprepared New Zealanders and I'm sure the IRD in New Zealand has the same attitude to Australians - it's not a competitive thing, just the way it is".
Go to page: 1 2