Superannuation fund and tax provision

Press, Volume CXI, Issue 32703, 4 September 1971, Page 18

Superannuation fund and tax provision

The proposed legislation to make special income tax provision for property syndicates, announced on Thursday by the Minister of Finance (Mr Muldoon), will not affect mutual superannuation funds based on property investment.

Mr J. R. Maddren, president of the newly-formed Association of Mutual Funds of New Zealand, said in Christchurch yesterday that members of the association welcomed the Government action.

“There is absolutely no connection between property syndicates and mutual superannuation funds,” Mr Maddren said.

A property syndicate was a group of investors usually brought together by a promoter to purchase a particular item of real estate. Their investment object was to obtain an income return from rents together with an eventual capital gain on the sale of the building, he said.

Mutual funds in New Zealand were established by trust deeds that appointed first and second trustees to administer and invest funds for the retirement benefit of their members, providing legal protection of investors'

funds. These deeds were approved, by the Commissioner of Inland Revenue. Mr Maddren said that the formation of the new association had been initiated by a number of the major funds to assure the public that the industry was conscious of its responsibilities. The association will lay down guidelines within which members should work.