A focus on topical tax issues - April 2016
Outsourcing payroll compliance overseas? Beware the risks
As companies look to rationalise and leverage greater efficiency in back office processes, it has become common for many of the HR and finance functions of New Zealand businesses to be provided by the HR or finance team of a foreign entity. In some cases, this will be an outsourced function of the business set up specifically to deal with the back office functions on a global basis. For New Zealand businesses, this service is often carried out by an Australian parent of the New Zealand business. The functions undertaken vary from company to company, however we commonly see the New Zealand entity’s payroll, GST returns, FBT returns and even corporate income tax returns being prepared by a centralised back office function based overseas.