In the turmoil of temporary lockdowns and excitement of the America’s Cup racing, many people have lost sight of the fact that the promised lift of the top marginal tax rate for individuals earning over $180,000 will apply from April 1, 2021. One potential solution was raising the trust tax rate to 39c in the future. Those taxpayers on arm’s-length salaries from corporates and the public sector can probably do very little to mitigate this extra tax burden. Tax mitigation v tax avoidance is a vexed area of tax law and involves a significant amount of judgement as to where one ends and the other starts. In summary, there are things that can legitimately be done now to mitigate the impost of the higher tax rate on some income, but “let’s be careful out there”.

Source: Otago Daily Times March 14, 2021 15:22 UTC