A globe-trotting sea captain has lost his battle to be considered a non-resident for tax purposes having fought his way almost to the Supreme Court.

Peter van Uden has worked at sea for more than 40 years but the Inland Revenue decided he had a permanent place of abode in New Zealand after he spent time in the country for several months each year between 2005 and 2009 and should pay tax on his income.

During that time, van Uden filed no tax returns apart from a non-resident tax return disclosing a small loss in 2007.

Court documents state van Uden met his future wife in 1998 when she was living at a property he then "almost always" stayed at when was in New Zealand.


The property was transferred to a family trust of which van Uden became a trustee in 1999, although he never owned the property.

"During the period in question, his typical pattern was to return to New Zealand twice per year during breaks from being at sea. It was accepted that he "almost always" stayed at the property when he was in New Zealand."

The Inland Revenue commissioner began an audit of van Uden in 2009 and issued him with the challenged assessments in February 2014.

The commissioner assessed van Uden as liable for income tax from 2005 to 2009 based on the fact van Uden had a permanent place of abode in New Zealand for those tax years and was liable to pay tax on his worldwide income.

In addition, a 10 per cent penalty was imposed because van Uden had taken an "unacceptable tax position" by not paying income tax.

Van Uden challenged the fact that the property was his permanent place of resident but the Taxation Review Authority, High Court and the Court of Appeal concluded van Uden had made the relevant property his home.

The Court of Appeal also dealt with van Uden's interest in his employer superannuation fund which as a foreign investment fund was taxable on an accrual basis.

"The court rejected the argument made on behalf of Mr van Uden that because the contributions to the Provident Fund were paid by his employers there was "no cost or expenditure incurred by or on behalf of Mr van Uden as regards that fund."


The Court of Appeal also rejected the challenge made to the process follow by the commissioner in removing the time bar that applied to the assessment for the 2005 to 2008 tax years.

On top of that it rejected van Uden's submission he should not have been liable for shortfall penalties.

"The court noted in this respect Mr van Uden had been aware there was an issue about whether he was a resident for tax purposes since 1995. Mr van Uden had received advice from his accountants that it appeared he would be treated as having a permanent place of abode in New Zealand and, so, as a resident."

Van Uden proposed an appeal to the Supreme Court based on four issues.

Firstly, he wished to argue that the courts had misapplied the test for a permanent place of abode.

He also argued that the focus of the foreign investment fund rules was on investment behaviour.

Van Uden questioned whether the legal case used to base its decision on him needing to pay shortfall penalties created a risk of a miscarriage of justice.

But the Supreme Court ruling found the three proposed grounds raised no questions of general or public important or of general commercial importance.

Van Uden also wished to pursue the submission that he had not had access to justice.

However the judgement said all his concerns had been considered by the previous courts.

"For reasons given, it is no necessary in the interests of justice for the Court to hear and determine the proposed appeal."

The application for leave to appeal was dismissed.

The judge also ordered van Uden to pay the Commissioner of Inland Revenue $2500 in costs.