NEW ZEALAND Law and Practice Contributed by: Greg Ambler and Elizabeth Heaney, Tompkins Wake
under the general law system. Under Pākehā or West- ern law, land is typically individualised and governed by general land law. The land is owned outright by individuals or entities and typically follows conven- tional succession law. There are set legal rules and guidelines to follow. Under tikanga Māori, or Māori customary law, land ownership is based on commu- nal ownership and guided by the values set out by tikanga Māori. In tikanga Māori, land is often owned collectively by progressively larger groups known as whānau, hapū or iwi. The members of these groups will often have an indivisible interest in the land. Under tikanga Māori, land is often viewed as more than just a resource, but can reflect a very important spiritual, ancestral con- nection, and comes with cultural obligations to care for the land. As a result, Māori land is often held in multiple owner- ship and cannot be divided between spouses or given solely to a recipient. Instead, a Māori descendent of those connected to the land will automatically have an interest in the land under tikanga Māori. Succes- sion is now handled under the Te Ture Whenua Māori Act 1993, where tikanga Māori is taken into account in the process. This is in contrast to the familiar set processes outlined in Western or Pākehā law for suc- cession and inheritance. 1.2 Wealth Profiles and Industry Influences As noted in 1.1 Social and Cultural Attitudes , the property-owning class of the past few decades holds significant wealth, and a common matter of note in New Zealand practice is the current intergenerational wealth transfer that represents the transfer of sig- nificant assets from the “baby boomer” generation, to their chosen heirs. This is a source of industry for private client advisers, as significant transactions are being made or contemplated, and each transfer is dif- ferent from the next. This can often involve significant and fraught transfers of power, restructuring of large business, division of assets across multiple parties, and in the midst of this, the navigation of diminished mental capacity as property owners age and decline. Primary industry and farming is still a major compo- nent of New Zealand industry, and this has developed
significantly in scope and complexity over the last 50 years. Farms and other primary industries that were previously traditional landholdings with a manual workforce and a simple personal ownership structure are now highly mechanised and technical, carefully structured (often in a corporate method) and larger in size and output. Trade relationships are global and succession of such assets can be fraught and com- plex, due to financial structuring and the difficulties of transferring a single business interest to multiple parties. There is also an increase in business relating to technology and science, harnessing AI technology and international markets. Given the subject matter, younger wealth cohorts are benefiting from this mar- ket successfully, and this will likely result in a new cohort of wealth on the horizon, with examples of this already existing following significant capital raises and early liquidity events. Domicile is distinct from tax residence in New Zea- land. Although domicile once determined whether gift duty applied (because gifts by donors domiciled in NZ were taxed on worldwide property and gifts by donors domiciled overseas were taxed only on NZ situated property), gift duty was abolished for all gifts made on or after 1 October 2011. Domicile itself is defined under the Domicile Act 1976, which adapts the com- mon law rules for establishing a person’s permanent home. The Act assumes the common law rule that a person can have only one domicile at a time. Although the Act does not define these terms, it preserves the structure of the “domicile of origin” (acquired at birth) and the “domicile of choice” (acquired by residing in a country with the intention to remain indefinitely). The concept of a dependent domicile has been abolished for married women. 2. Residency and Domicile for Purposes of Wealth and Estate Planning 2.1 Determining Domicile
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