Chapter Twenty-Two

New Zealand Transfer Pricing Developments

New Zealand issued transfer pricing guidelines as an appendix to the Tax Information Bulletin, Vol. 23, no. 10 (October 2000), doing so as a guide to section GD 13 of New Zealand’s Income Tax Act 1994. Earlier transfer pricing provisions go back to the Income Tax Act 1976, section 22. The New Zealand transfer pricing guidelines specifically address documentation and intangibles issues in detail as well as examining services and cost sharing issues.

Most recently, New Zealand’s current transfer pricing focus, as of May 14, 2008, addressed four issues related to transfer pricing: royalties, business restructuring, private equity, and intangible asset impacts. New Zealand transfer pricing is quite advanced, given the country’s population. Thus, for example, New Zealand has a fully developed advance pricing agreement (APA) program, completing 31 APAs as of March 31, 2008, and having 6 APA applications in progress.


The New Zealand transfer pricing guidelines are 79 pages in length and comprise these areas:

  • Introductory material
  • Arm’s length principle
  • Pricing methods: theoretical and practical considerations
  • Principles of comparability
  • Practical application of arm’s length principles
  • Documentation: statutory considerations and the Inland Revenue’s approach
  • Intangible property
  • Cost contribution arrangements
  • Changes from the draft guidelines


New Zealand follows closely ...

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