[World Tax News] New Zealand Consults on Shareholder Loan Taxation

Editorial Team – [2025] 181 taxmann.com 368 (Article)

World Tax News provides a weekly snippet of tax news from around the globe. Here is a glimpse of the tax happening in the world this week:

1. New Zealand Begins Consultation on Taxation of Company to Shareholder Loans

New Zealand Inland Revenue has initiated a public consultation on proposed changes to the taxation framework for loans provided by companies to their shareholders. Submissions are open until 5 February 2026.

Key Proposal

Inland Revenue is seeking feedback on measures aimed at improving the tax treatment of new shareholder loans. The central proposal introduces a new time-limit rule, under which certain loans made by a company to its shareholders would be treated as dividends if they are not repaid within 12 months from the end of the income year in which they were issued.

This rule would:

Apply only to new loans, excluding all existing shareholder loans; and
Apply only where a company’s total lending to shareholders is NZD 50,000 or more.

Further Information

Additional details are available in the following materials:

Officials’ issues paper: Improving taxation of loans made by companies to shareholders
Information sheet: Improving taxation of loans made by companies to shareholders
Inland Revenue media release

Source – Public Consultation

2. Hong Kong Updates List of Qualifying Debt Instruments Eligible for Tax Concessions

The Hong Kong Inland Revenue Department (IRD) has released updated lists of Qualifying Debt Instruments (QDIs) as at 30 September 2025.

The updated lists cover:

QDIs issued before 1 April 2018, comprising:

1. Short- and medium-term QDIs eligible for a 50% Profits Tax concession under section 14A(1) of the Inland Revenue Ordinance; and
2. Long-term QDIs eligible for Profits Tax exemption under section 26A(1), applicable from the 2003/04 year of assessment.

QDIs issued on or after 1 April 2018, which are intended to qualify for Profits Tax exemption under section 14A(1B), effective from the 2018/19 year of assessment.

The QDI lists primarily include debt instruments issued by financial institutions and government entities across the Asia-Pacific region, along with a limited number of other issuers.

Source – List of Qualifying Debt Instruments