Taxation (KiwiSaver HomeStart and Remedial Matters) Act 2015
We were delighted, following our written and oral submissions to the Finance and Expenditure Select Committee and subsequent exchanges, to see changes to the Taxation (KiwiSaver HomeStart and Remedial Matters) Bill that were of material benefit to the industry.
These changes included:
- Securities Act non-compliance protections with respect to the content of investment statements and prospectuses registered or dated before 1 June 2015; and
- the deferral until 1 June 2015 of the effective date for the amendments allowing KiwiSaver members to access their savings to help pay an initial deposit before a sale and purchase agreement goes unconditional (thus allowing providers some time to ready themselves to implement that change).
KiwiSaver Act 2006 – Related Party Issues
We have made submissions to MBIE seeking clarity on the operation of the ‘in-house assets’ restrictions that will be imposed (under section 176 of the Financial Markets Conduct Act 2013) on restricted schemes. We will keep members apprised of developments.
KiwiSaver in Bankruptcy
A recent Court of Appeal decision has overturned earlier findings by the High Court that KiwiSaver balances were automatically assigned to the Official Assignee on the bankruptcy of a member.
Two issues before the Court were:
- whether the Insolvency Act 2006 entitles the Official Assignee (OA) to access KiwiSaver balances or is ‘trumped’ by the prohibition on assignments in the KiwiSaver Act 2006 (KSA), and
- whether bankruptcy automatically satisfies the ‘significant financial hardship’ test in the KiwiSaver Scheme Rules, thus allowing an early withdrawal of KiwiSaver funds.
The Court of Appeal’s response to both questions was ‘no’, meaning a bankrupt’s KiwiSaver account balance is off limits to the OA.
A discussion of the decision and its consequences can be found on the Chapman Tripp website here.
