The New Zealand’s Inland Revenue (IR) has announced relief regarding advance pricing agreement (APA) during the COVID-19 outbreak. Inland Revenue has assured that customers do not need to take any specific action now to ensure that their circumstances are appropriately reviewed in due course. The following relief has been taken by Inland Revenue:
- IR input or permission is not required where a customer makes a business decision that results in an APA breach.
- If an APA breach occurs, these breaches will need to be addressed in the relevant year’s Annual Compliance Report (ACR). IR will recognize that due to the significant uncertainty faced by business currently, communication at any earlier point, particularly before year-end or before a tax position is taken, may be problematic.
- When reviewing an APA breach disclosed in the ACR, IR will have regard to the exceptional circumstances faced by the customer and IR anticipate that there will be some circumstances where the arm’s length outcome during the COVID-19 pandemic may differ from that agreed in the APA.
