Taxation (Business Taxation and Remedial Matters) Act 2007

1: Title
This Act is the Taxation (Business Taxation and Remedial Matters) Act 2007.
2: Commencement
1: This Act comes into force on the date on which it receives the Royal assent, except as provided in this section. 2007-12-19 Income Tax Act 2004 Tax Administration Act 1994 Goods and Services Tax Act 1985 Income Tax Act 1994 Taxation Review Authorities Act 1994 Taxation (Depreciation, Payment Dates Alignment, FBT, and Miscellaneous Provisions) Act 2006 Goods and Services Tax (Grants and Subsidies) Order 1992
2: Section 284 1995-04-01 Income Tax Act 1994
3: Sections 286 287 1997-04-01 Income Tax Act 1994
4: Sections 241(1) (3) 269(1) 1999-04-01 Tax Administration Act 1994 Estate and Gift Duties Act 1968
5: Sections 281 282(3) 2001-04-01 Income Tax Act 1994
6: Section 273(2) (4) (5) 2001-10-24 Goods and Services Tax Act 1985
7: Section 285 2002-04-01 Income Tax Act 1994
8: Section 269(3) 2003-04-01 Estate and Gift Duties Act 1968
9: Section 133(1) 2004-06-04 Income Tax Act 2004
10: Section 288(3) 2004-11-16 Income Tax Act 1994
11: Sections 6 7 8 9 10 13 18 19 22 23 24 25 35 39 40 41 54 55 56 76 77 79 102 128 154 165 167 182(25) (28) (33) (55) 185(2) 230(1) (2) 272(1) 2005-04-01 Income Tax Act 2004 Tax Administration Act 1994 Goods and Services Tax Act 1985
12: Section 129(1) 2005-07-01 Income Tax Act 2004
13: Sections 176 177 2006-04-01 Income Tax Act 2004
14: Sections 130 182(44) 185(1) 2006-12-01 Income Tax Act 2004
15: Sections 4 16 26 27 31 32 38 43 44 45 46 47 49 58 59 60 61 62 63 64 65 66 67 68 69 70 71 72 73 74 80 81 82 83 84 85 87 88 89 90 91 92 94 95 96 97 100 104 131 132 135(2) 136 138 140 153 178 179(1) (3) 181 182(5) (6) (7) (8) (9) (10) (11) (12) (13) (14) (15) (16) (18) (19) (20) (22) (24) (27) (29) (30) (43) (45) (46) (47) (48)(a) (b) (49) (50) (51) (52) (53) (54) (56) 184 189(2) (5) 192 193(1) 194(1) 202 210 224(1) (4) 227(1) 228(1) (3) 231(1) 252(2) 262(1) 295 299 300 302 304 305 2007-04-01 Income Tax Act 2004 Tax Administration Act 1994 Housing Restructuring and Tenancy Matters Act 1992 Rates Rebate Act 1973 Social Security Act 1964 Health Entitlement Cards Regulations 1993 Social Security (Temporary Additional Support) Regulations 2005 Student Allowances Regulations 1998
16: Sections 156(1) (2) 256 258 273(1) (3) 274 2007-05-17 Income Tax Act 2004 Tax Administration Act 1994 Goods and Services Tax Act 1985
17: Sections 50 51 52 78 101 182(17) (26) (59) 2007-06-20 Income Tax Act 2004
18: Sections 5 12 28 29 30 34 75 98 99 103 105 106 107 108 109 110 111 112 113 114 115 116 117 118 119 120 121 122 123 124 125 126 127 134 135(1) 139 141 142 143 144 145 146 147 148 149 150 151 152 157 158 159 160 161 162 163 164(2) 166(2) 168 169 170 171 172 173 174 175 179(2) 180 182(2) (4) (23) (31) (35) (36) (37) (38) (39) (40) (41) (42) 186 190 195 196(1) (2) (4) 207(2) (5) (6) (8) (9) 208(1) 236 237 238 239 240 245 246 247 248 249 279(1) 2007-10-01 Income Tax Act 2004 Tax Administration Act 1994 Goods and Services Tax Act 1985
19: Section 275 2007-11-30 Goods and Services Tax Act 1985
20: Sections 191 193(2) (3) 194(2) (3) 196(3) (5) 201 203(2) 204(1) 205 206(2) (3) 207(1) (3) (4) (7) (10) 208(2) 211 212 213 214 215 216 217 218 219 222 223 224(2) (3) (5) 227(2) 228(2) 231(2) to (4) 241(2) 242 243 244 250(1) to (3) 251 252(1) (3) (4) 253 254 255 257 259 260 261 262(2) 263 264 265 266 267 269(2) (4) 272(2) 278 279(2) 290 294 307 to 318 321 to 328 330 to 342 344 to 437 438(1) 439 to 538 540 to 549 550(2) to (41) (43) to (68) 551 to 553 554(1) (2) 554(3) 555 to 562 2008-04-01 Tax Administration Act 1994 Estate and Gift Duties Act 1968 Goods and Services Tax Act 1985 Taxation Review Authorities Act 1994 Health (Drinking Water) Amendment Act 2007 Income Tax Act 2007
21: Sections 14 15 21 36 37 137 182(32) 183 197(1) to (3) 198 303 319 320 329 343 438(2) 539 550(42) 2008-07-01 Income Tax Act 2004 Tax Administration Act 1994 Income Tax (Withholding Payments) Regulations 1979 Income Tax Act 2007
22: Sections 220(1) 293 297 298
a: a date to be fixed by the Governor-General by Order in Council:
b: 1 April 2009. OIC SR 2008/242 2008-08-08 Tax Administration Act 1994 Customs and Excise Act 1996 Privacy Act 1993
23: Section 229
a: a date to be fixed by the Governor-General by Order in Council:
b: 1 April 2010. Section 2(20) amended 29 May 2008 section 60(2) Taxation (Personal Tax Cuts, Annual Rates, and Remedial Matters) Act 2008 Section 2(21) amended 29 May 2008 section 60(2) Taxation (Personal Tax Cuts, Annual Rates, and Remedial Matters) Act 2008 Section 2(22) brought into force 8 August 2008 Taxation (Business Taxation and Remedial Matters) Act Commencement Order 2008
1: Amendments to Income Tax Act 2004
3: Income Tax Act 2004
Sections 4 to 186 Income Tax Act 2004
4: Withholding liabilities
1: After section BE 1(5) Retirement scheme contributions
5B: A person who makes a retirement scheme contribution to a retirement savings scheme must pay retirement scheme contribution withholding tax under the RSCWT rules.
2: In section BE 1 retirement savings scheme retirement scheme contribution retirement scheme contribution withholding tax RSCWT rules
5: Section CB 4B replaced
Section CB 4B
CB 4B: Disposal of certain shares by portfolio investment entity or New Zealand Superannuation Fund after declaration of dividend
When this section applies
1: This section applies to a portfolio investment entity or the New Zealand Superannuation Fund (the entity
a: the entity disposes of a share in a company; and
b: section CX 44C
c: a dividend from the share is—
i: declared before the disposal; and
ii: paid to a holder of the share who after the disposal becomes entitled to the dividend. Income
2: The entity derives an amount of income that is the greater of zero and the amount calculated using the formula (declaration shares - distribution shares) x distribution. Definition of items in formula
3: The items in the formula are defined in subsections (4) to (6) Declaration shares
4: Declaration shares Distribution shares
5: Distribution shares Distribution
6: Distribution
a: the dividend that is not fully imputed as that term is defined in section NG 2(3)
b: the dividend, if paragraph (a) amount company dividend imputation credit account income portfolio investment entity share .
6: New section CB 5A inserted
1: Before section CB 5
CB 5A: Land partially sold or sold with other land
Sections CB 5 to CB 21
a: is part of the land to which the relevant section applies:
b: is the whole of the land to which the relevant section applies:
c: is disposed of together with other land. amount dispose land .
2: Subsection (1)
7: Disposal: amount from major development or division and not already in income
1: Section CB 11(2) Exclusions
2: Subsection (1) section CB 15 section CB 18 section CB 19 section CB 21
2: Subsection (1)
a: a disposal of land occurring on or after the date on which this Act receives the Royal assent:
b: a person and a disposal of land occurring before the date on which this Act receives the Royal assent, if the person—
i: is the person disposing of the land; and
ii: takes a tax position relating to the disposal in a return for the income year of the disposal; and
iii: in taking the tax position, relies on the law that would apply if subsection (1)
iv: provides the return to the Commissioner by the due date for the return.
8: Residential exclusion from sections CB 10 and CB 11
In section CB 15(1) paragraph (a) Section CB 10 Sections CB 10 and CB 11
9: Business exclusion from section CB 10
1: In the heading to section CB 18 section CB 10 sections CB 10 and CB 11
2: In section CB 18 paragraph (a) Section CB 10 Sections CB 10 and CB 11
3: Subsection (2)
a: a disposal of land occurring on or after the date on which this Act receives the Royal assent:
b: a person and a disposal of land occurring before the date on which this Act receives the Royal assent, if the person—
i: is the person disposing of the land; and
ii: takes a tax position relating to the disposal in a return for the income year of the disposal; and
iii: in taking the tax position, relies on the law that would apply if subsection (2)
iv: provides the return to the Commissioner by the due date for the return.
10: Investment exclusion from section CB 10
1: In the heading to section CB 21 section CB 10 sections CB 10 and CB 11
2: In section CB 21 paragraph (a) Section CB 10 Sections CB 10 and CB 11
3: Subsection (2)
a: a disposal of land occurring on or after the date on which this Act receives the Royal assent:
b: a person and a disposal of land occurring before the date on which this Act receives the Royal assent, if the person—
i: is the person disposing of the land; and
ii: takes a tax position relating to the disposal in a return for the income year of the disposal; and
iii: in taking the tax position, relies on the law that would apply if subsection (2)
iv: provides the return to the Commissioner by the due date for the return.
11: Foreign investment fund income
Section CD 26(b)
b: the person calculates their FIF income or loss in relation to the interest and the period in which the amount is paid under—
i: the comparative value method:
ii: the deemed rate of return method:
iii: the cost method:
iv: the fair dividend rate method; and
c: if the calculation referred to in paragraph (b)
i: the FIF is not a grey list company:
ii: the person does not hold a direct income interest of 10% or more in the FIF at the beginning of the income year of the period.
12: Determination of amount of credit in certain cases
In section CD 32(26)(b) dividend: dividend ( section MZ 18
13: When does a person have attributed repatriation from a CFC?
1: In section CD 34(1)(b) EX 16 EX 17
2: Subsection (1)
14: New heading and section CE 12 inserted
After section CE 11 Tax credits
CE 12: Tax credits under section LD 1B added to provider's income
When this section applies
1: This section applies when a person is allowed under section LD 1B Income
2: An amount equal to the credit is income of the person in the income year, if the amount is not income under any other provision. income income year payment .
15: Benefits, pensions, compensation, and government grants
1: In section CF 1(2) accident compensation payment paragraph (f) of that Act of that Act:
g: a personal service rehabilitation payment for a claimant under the Injury Prevention, Rehabilitation, and Compensation Act 2001
2: In section CF 1 personal service rehabilitation payment
16: When FIF income arises
1: In section CQ 5(1)
a: in paragraph (d) subparagraph (i) any time during the income year any time in the year
b: in paragraph (db) subparagraph (i) , at any time in the year, the person holds
c: in paragraph (f) , EX 48 (Top-up FIF income: deemed rate of return method), or EX 49 (Top-up FIF income: 1 April 1993 uplift interests) income or loss)
2: After section CQ 5(1) Treatment of deemed transaction under section EX 51, EX 53, or EX 54B
1B: If a person is treated under section EX 51(5) (Consequences of changes in method), EX 53 (Changes in application of FIF exemptions), or EX 54B subsection (1)(d) and (db)
17: Exclusions of withdrawals of various kinds
Section CS 2(4B)
18: Meaning of petroleum miner
1: Section CT 6(1)
1: Petroleum miner
2: In section CT 6(2) paragraph (a) an activity described in subsection (3) petroleum mining operations
3: Section CT 6(3) and (4)
4: In the list of defined terms in section CT 6
a: petroleum mining operations
b: removal or restoration operations
5: Subsections (1) to (4)
19: New section CT 6B inserted
1: After section CT 6
CT 6B: Meaning of petroleum mining operations
Meaning
1: Petroleum mining operations subsection (2) subsection (3) Activities: inclusions
2: The activities are those carried out in connection with—
a: prospecting or exploring for petroleum:
b: developing a permit area for producing petroleum:
c: producing petroleum:
d: processing, storing, or transmitting petroleum before its dispatch to a buyer, consumer, processor, refinery, or user:
e: removal or restoration operations. Activities: exclusions
3: The activities do not include further treatment to which all the following apply:
a: it occurs after the well stream has been separated and stabilised into crude oil, condensate, or natural gas; and
b: it is done—
i: by liquefaction or compression; or
ii: for the extraction of constituent products; or
iii: for the production of derivative products; and
c: it is not treatment at the production facilities. permit area petroleum petroleum mining operations removal or restoration operations .
2: Subsection (1)
20: Proceeds of share disposal by qualified foreign equity investor
1: In section CW 11B(4) foreign exempt entity
a: paragraph (c)
c: under the laws of the territory, or of the part of the territory, is not subject to a tax on income other than as a body that handles income of the members; and :
b: in paragraph (f)(iii) taxation laws laws
c: in paragraph (f)(iii) subparagraph (ii) subparagraph (ii)
g: does not have a holder of a direct or indirect interest in the capital of the legal entity who—
i: is a resident of New Zealand; and
ii: holds a total direct or indirect interest of 10% or more in the capital of the legal entity, when treated as holding the interests of any person who is associated with the holder under section OD 8(1) .
2: In section CW 11B(4) foreign exempt partnership
a: paragraph (c)
c: under the laws of the territory, or of the part of the territory, is not subject to a tax on income other than as a body that handles income of the partners; and :
b: in paragraph (h)(ii) taxation laws laws
c: in paragraph (h)(ii) subparagraph (i) subparagraph (i)
i: does not have a holder of a direct or indirect interest in the capital of the unincorporated body who—
i: is a resident of New Zealand; and
ii: holds a total direct or indirect interest of 10% or more in the capital of the unincorporated body, when treated as holding the interests of any person who is associated with the holder under section OD 8(1) .
3: In section CW 11B(4) foreign exempt person
a: paragraph (d)
d: under the laws of the territory, or of the part of the territory, derives the proceeds from a disposal of shares or options that are held by the person; and :
b: in paragraph (e)(ii) taxation laws laws
c: in paragraph (e)(ii) subparagraph (i) subparagraph (i)
f: does not have a holder of a direct or indirect interest in the person who—
i: is a resident of New Zealand; and
ii: holds a total direct or indirect interest of 10% or more in the capital of the person, when treated as holding the interests of any person who is associated with the holder under section OD 8(1) .
4: Section CW 11B(5)(a) and (b)
a: under a double tax agreement between New Zealand and the territory that is in force under the terms of the double tax agreement, if—
i: there is such a double tax agreement; and
ii: the double tax agreement provides for the residency of the person:
b: under the laws of the territory, if paragraph (a)
21: New section CW 28B inserted
After section CW 28
CW 28B: Payment of certain accident compensation payments
The amount paid to a person (the claimant Injury Prevention, Rehabilitation, and Compensation Act 2001
a: the claimant pays an amount to another person for providing a key aspect of social rehabilitation referred to in the definition of personal service rehabilitation payment in section OB 1
b: the amount paid by the claimant for a key aspect of social rehabilitation for the income year is equal to or more than the amount of personal service rehabilitation payments, after any deduction of tax under this Act, paid to the claimant for the year. exempt income income year payment personal service rehabilitation payment .
22: Local authorities
Section CW 32(4)(c)(i)
i: a council-controlled organisation, other than a council-controlled organisation operating a hospital as a charitable activity on behalf of the local authority: .
23: Charities: non-business income
Section CW 34(3)
3: This section does not apply to income derived by—
a: a council-controlled organisation, other than a council-controlled organisation operating a hospital as a charitable activity:
b: a local authority from a council-controlled organisation, other than from a council-controlled organisation operating a hospital as a charitable activity on behalf of the local authority.
24: Charities: business income
Section CW 35(2)
2: This section does not apply to income derived by—
a: a council-controlled organisation, other than a council-controlled organisation operating a hospital as a charitable activity:
b: a local authority from a council-controlled organisation, other than from a council-controlled organisation operating a hospital as a charitable activity on behalf of the local authority.
25: New heading and sections CW 49C and CW 49D inserted
1: After section CW 49B Income of, and distributions by, certain international funds
CW 49C: Income of certain international funds
An amount of income derived by a person is exempt income if the person is—
a: the trustee of the Niue International Trust Fund:
b: the trustee of the Tokelau International Trust Fund. amount exempt income income Niue International Trust Fund Tokelau International Trust Fund trustee
CW 49D: Distributions by certain international funds
An amount of income derived by a person is exempt income if the income is a distribution by—
a: the trustee of the Niue International Trust Fund:
b: the trustee of the Tokelau International Trust Fund. amount distribution exempt income income Niue International Trust Fund Tokelau International Trust Fund trustee .
2: Subsection (1)
26: Heading above section CX 42 replaced
The heading above section CX 42 Contributions to superannuation scheme or retirement savings scheme
27: New section CX 42B inserted
After section CX 42
CX 42B: Contributions to retirement savings scheme
Excluded income
1: A retirement scheme contribution is excluded income of—
a: the person for whose benefit the retirement scheme contribution is provided, to the extent to which the retirement scheme contribution is—
i: money:
ii: an amount of imputation credit or Maori authority credit that is used to meet the liability of the retirement scheme contributor for retirement scheme contribution withholding tax on the retirement scheme contribution:
b: the retirement savings scheme. Exclusion
2: Subsection (1)(a)
a: supplies to the retirement scheme contributor, or to the retirement savings scheme, a retirement scheme withholding rate that is less than the retirement scheme prescribed rate for the person:
b: includes the retirement scheme contribution in a return of income for the income year in which the retirement scheme contribution is provided:
c: is a non-resident and the retirement scheme contribution is non-resident withholding income. excluded income income year non-resident non-resident withholding income retirement savings scheme retirement scheme contribution retirement scheme contributor retirement scheme prescribed rate retirement scheme withholding rate return of income .
28: Proceeds from disposal of certain shares by portfolio investment entities or New Zealand Superannuation Fund
1: In section CX 44C(1) paragraph (a) portfolio investment entity portfolio investment entity or by a life insurer, in relation to that part of the life insurer that is a portfolio investment-linked life fund,
2: Section CX 44C(1)(a)(i)
i: resident in Australia and not treated as being resident in a country other than Australia in an agreement between Australia and another country that would be a double tax agreement if the agreement were negotiated between New Zealand and the other country; and .
3: In section CX 44C(1)(b) share. share; and
c: the entity disposing of the share is not assured, under an arrangement entered with another person when the share is acquired, of having a gain on the disposal.
4: In section CX 44C portfolio investment-linked life fund
29: Portfolio investor allocated income and distributions of income by portfolio investment entities
1: Section CX 44D(1) Portfolio investor allocated income
1: Portfolio investor allocated income derived under section CP 1
a: the prescribed investor rate for the investor and the portfolio calculation period is more than zero; and
b: the prescribed investor rate for the investor and the portfolio calculation period is not more than the portfolio investor rate for the investor and the portfolio calculation period when the entity calculates in relation to the portfolio investor allocated income—
i: the portfolio entity tax liability of the entity; or
ii: the amount of a payment under section HL 23B
c: for a portfolio tax rate entity making payments of tax under section HL 21
2: In section CX 44D(2) distribution by distribution or dividend of
3: In section CX 44D(3) paragraph (a) distribution by distribution or dividend of
4: Section CX 44D(3)(a)(i)
i: is a natural person or a trustee; and .
30: Cost of revenue account property
1: Section DB 17(3)(a)
a: the person is a portfolio investment entity or a life insurer in relation to that part of the life insurer that is a portfolio investment-linked life fund; and .
2: In section DB 17 portfolio investment-linked life fund
31: Research or development
1: In section DB 26(2) paragraph 5.1 or 5.2 of the reporting standard paragraph 68(a) of the reporting standard, applying, for the purposes of that paragraph, paragraphs 54 to 67 of the reporting standard
2: Section DB 26(3)
3: In section DB 26(4)(a) of paragraph 2.3 of the reporting standard it is an amount written off due to its being an immaterial amount for financial reporting purposes
4: Section DB 26(4)(b)
b: would be required, if the expenditure were material, to recognise it for financial reporting purposes under paragraph 68(a) of the reporting standard, applying, for the purposes of that paragraph, paragraphs 54 to 67 of the reporting standard.
5: Section DB 26(5)(b)
b: has written off the expenditure due to its being an immaterial amount for financial reporting purposes; and .
6: Subsections (1) to (5)
a: the 2007–08 and later income years, unless paragraph (b)
b: the first income year for which a person adopts IFRSs for the purposes of financial reporting and later income years, if that first income year is before the 2007–08 income year.
32: Some definitions
1: Section DB 27(1) Definitions
1: In this section, and in section DB 26 development reporting standard research
2: In section DB 27 Financial Reporting Standard No 13 1995 (Accounting for Research and Development Activities),
3: Subsections (1) (2)
a: the 2007–08 and later income years, unless paragraph (b)
b: the first income year for which a person adopts IFRSs for the purposes of financial reporting and later income years, if that first income year is before the 2007–08 income year.
33: Gifts of money by company
In section DB 32(3) 5% of
34: Certain investors have deduction for portfolio investor allocated loss
Section DB 43B(2)(a)
a: the portfolio tax rate entity makes payments of tax under section HL 21 .
35: Sale of business: transferred employment income obligations
1: In section DC 9(2)(a) any part the provision made by the seller for a part
2: In section DC 9(2)(b) of the provision the amount
3: Section DC 9(3)
3: If the seller and the buyer are associated persons at the time of the sale,—
a: the buyer is allowed a deduction for the provision made by the seller for the amount of employment income if the seller would have been allowed a deduction for the amount if the business, or the part of the business, had not been sold; and
b: section EA 4(5) Deduction: Buyer's payment exceeding provision
3B: The buyer is allowed a deduction for any part of the amount of employment income that the buyer pays and that exceeds the provision made by the seller for that amount.
4: In section DC 9(4)(b) subsection (3) subsections (3) and (3B)
5: Subsections (1) to (4)
36: Heading to subpart DF
In the heading to subpart DF grants grants and compensation
37: New section DF 4 added
After section DF 3
DF 4: Payment by claimant receiving personal service rehabilitation payment
When this section applies
1: This section applies when a person (the claimant Injury Prevention, Rehabilitation, and Compensation Act 2001 Deduction
2: The claimant is allowed a deduction for the income year of the amount given by subsection (3) Formula
3: The amount of the deduction allowed under subsection (2) Definition of items in formula
4: In the formula,—
a: amount paid section OB 1
b: tax rate Link with subpart DA
5: This section supplements the general permission and overrides the capital limitation and private limitation for the amount described in subsection (2) assessable income capital limitation general limitation general permission income year payment personal service rehabilitation payment private limitation .
38: When FIF loss arises
1: In section DN 6(1)
a: in paragraph (d) subparagraph (i) any time during the income year any time in the year
b: in paragraph (db) subparagraph (i) , at any time in the year, the person holds
2: After section DN 6(1) Treatment of deemed transaction under section EX 51, EX 53, or EX 54B
1B: If a person is treated under section EX 51(5) (Consequences of changes in method), EX 53 (Changes in application of FIF exemptions), or EX 54B subsection (1)(d) and (db)
39: Acquiring film rights
1: In section DS 1(2)(c) expenditure. expenditure; or
d: section DS 2B
2: In section DS 1(4) except under section DS 2B under any other provision of this Act
40: Film production expenditure
1: Section DS 2(3) and (4) Exclusion
3: This section does not apply to film production expenditure if—
a: the film is produced mainly for broadcast in New Zealand by a person who operates a television station, a television network, or a cable television system:
b: the film is intended to be shown as an advertisement:
c: section DS 2B Timing of deduction
4: The deduction is allocated under—
a: section EJ 7 (Film production expenditure for New Zealand films having no large budget screen production grant) or EJ 8
b: section EJ 4 (Expenditure incurred in acquiring film rights in feature films) or EJ 5
2: In section DS 2(5) except under section DS 2B under any other provision of this Act
3: Subsection (1)
41: New section DS 2B inserted
1: After section DS 2
DS 2B: Expenditure in acquiring film, or film right, intended for disposal
Deduction
1: A person is allowed a deduction for film production expenditure or expenditure incurred in acquiring a film right if, when the person incurs the expenditure, the person intends to dispose of the film or film right. Timing of deduction
2: The deduction is allocated under section EA 2 Link with subpart DA
3: This section overrides the capital limitation. The general permission must still be satisfied and the other general limitations still apply. capital limitation deduction film film production expenditure film right general limitation general permission .
2: Subsection (1)
42: Maori authorities: donations
1: In section DV 11(2) 5% of
2: Subsection (1)
43: Cost
1: In section EB 6(1) , unless subsection (1B) accounting practice
2: After section EB 6(1) Valuation at cost: agricultural produce
1B: Despite subsection (1)
a: value their closing stock at cost; and
b: include and allocate costs so that the value of their closing stock is not materially different from the value of the closing stock obtained by applying NZIAS 2 ignoring paragraph 20 of NZIAS 2.
3: In section EB 6(2) Financial Reporting Standard No 4 (Accounting for Inventories) approved under the Financial Reporting Act 1993 NZIAS 2
4: The following is added to section EB 6 Definitions
3: In this section, NZIAS 41
5: In section EB 6 NZIAS 2 NZIAS 41
6: Subsections (1) to (5)
a: the 2007–08 and later income years, unless paragraph (b)
b: the first income year for which a person adopts IFRSs for the purposes of financial reporting and later income years, if that first income year is before the 2007–08 income year.
44: Discounted selling price
1: In section EB 9(3)(a) Financial Reporting Standard No 4 (Accounting for Inventories) approved under the Financial Reporting Act 1993 NZIAS 2
2: In section EB 9 NZIAS 2
3: Subsections (1) (2)
a: the 2007–08 and later income years, unless paragraph (b)
b: the first income year for which a person adopts IFRSs for the purposes of financial reporting and later income years, if that first income year is before the 2007–08 income year.
45: Valuing closing stock consistently
1: In section EB 12 Financial Reporting Standard No 1 (Disclosure of Accounting Policies) approved under the Financial Reporting Act 1993 NZIAS 8
2: In section EB 9 NZIAS 8
3: Subsections (1) (2)
a: the 2007–08 and later income years, unless paragraph (b)
b: the first income year for which a person adopts IFRSs for the purposes of financial reporting and later income years, if that first income year is before the 2007–08 income year.
46: Discounted selling price for low-turnover traders
1: In section EB 19(4)(a) Financial Reporting Standard No 4 (Accounting for Inventories) approved under the Financial Reporting Act 1993 NZIAS 2
2: In section EB 9 NZIAS 2
3: Subsections (1) (2)
a: the 2007–08 and later income years, unless paragraph (b)
b: the first income year for which a person adopts IFRSs for the purposes of financial reporting and later income years, if that first income year is before the 2007–08 income year.
47: Valuing closing stock consistently for low-turnover traders
1: In section EB 22(1) Financial Reporting Standard No 1 (Disclosure of Accounting Policies) approved under the Financial Reporting Act 1993 NZIAS 8
2: In section EB 22 NZIAS 8
3: Subsections (1) (2)
a: the 2007–08 and later income years, unless paragraph (b)
b: the first income year for which a person adopts IFRSs for the purposes of financial reporting and later income years, if that first income year is before the 2007–08 income year.
48: Reduction: bloodstock not previously used for breeding in New Zealand
1: In the heading to section EC 41 other than as shuttle stallions New Zealand
2: Section EC 41(1)(b)
b: before a person ( person A
3: After section EC 41(1) Further bloodstock to which this section applies
1B: This section also applies to bloodstock that, before person A acquired it, was used by another person for breeding in New Zealand if—
a: the other person transferred the bloodstock to person A under a matrimonial agreement to which section FF 12
b: the other person was a company in the same wholly-owned group as person A at the time person A acquired the bloodstock from the other person:
c: the bloodstock is a stallion that, for each year in which the stallion was used for breeding in New Zealand before being acquired by person A, was—
i: owned by a non-resident; and
ii: removed from New Zealand after the breeding season; and
iii: not subject to a reduction under this section.
4: Subsections (2) (3)
49: Valuation of excepted financial arrangements
1: In section ED 1(3) Financial Reporting Standard No 1 (Disclosure of Accounting Policies) approved under the Financial Reporting Act 1993 NZIAS 8
2: In section ED 1 NZIAS 8
3: Subsections (1) (2)
a: the 2007–08 and later income years, unless paragraph (b)
b: the first income year for which a person adopts IFRSs for the purposes of financial reporting and later income years, if that first income year is before the 2007–08 income year.
50: Special rate or provisional rate
In section EE 28 Exception
4: This section is subject to section FC 81(8)
51: Meaning of adjusted tax value
In section EE 46 Exception
2: This section is subject to section FC 81(7)
52: Meaning of annual rate
After section EE 52(6) Exception
7: This section is subject to section FC 81(8)
53: Allocation of income and deductions by portfolio tax rate entity
1: In the heading to section EG 3 income and deductions income, deductions, and credits
2: After section EG 3(2) Credits
3: A credit received by a portfolio tax rate entity is allocated to the portfolio allocation period under subsection (2)
54: Expenditure incurred in acquiring film rights in feature films
1: Section EJ 4(1) Feature films
1: A deduction for expenditure that a person incurs in acquiring a film right is allocated under this section if the film is a feature film and—
a: the deduction is under section DS 1
b: the deduction is under section DS 2
2: Subsection (1)
55: Expenditure incurred in acquiring film rights in films other than feature films
1: Section EJ 5(1) Films other than feature films
1: A deduction for expenditure that a person incurs in acquiring a film right is allocated under this section if the film is not a feature film and—
a: the deduction is under section DS 1
b: the deduction is under section DS 2
2: Subsection (1)
56: Film production expenditure for New Zealand films
1: The heading to section EJ 7 Film production expenditure for New Zealand films having no large budget screen production grant
2: Section EJ 7(1) New Zealand films
1: A deduction under section DS 2
a: the film is not one for which a large budget screen production grant is made; and
b: the film has a final certificate under section EJ 6
3: Subsections (1) (2)
57: Film production expenditure for films other than New Zealand films
1: The heading to section EJ 8 Film production expenditure for other films having no large budget screen production grant
2: Section EJ 8(1) Films other than New Zealand films
1: A deduction under section DS 2
a: the film is not one for which a large budget screen production grant is made; and
b: the film does not have a final certificate under section EJ 6
3: Subsections (1) (2)
58: What spreading methods do
1: Before section EW 14(2)(a)
aa: the IFRS taxpayer method, to which sections EW 15B to EW 15E .
2: Section EW 14(2)(e)
3: In section EW 14 IFRS taxpayer method
4: Subsections (1) to (3)
a: the 2007–08 and later income years, unless paragraph (b) (c)
b: the first income year for which a person adopts IFRSs for the purposes of financial reporting and later income years, if that first income year is before the 2007–08 income year and the person chooses to apply the IFRS taxpayer method in a return of income for that first year; or
c: the 2008–09 and later income years, if a person's 2008–09 income year starts before 1 January 2008 and the person has not adopted IFRSs for the purposes of financial reporting before 1 January 2007.
59: What is included when spreading methods used
1: In section EW 15(1)(a) ignoring non-contingent fees; and ignoring—
i: non-contingent fees, if the relevant method is not the IFRS method described in section EW 15C
ii: non-integral fees, if the relevant method is the IFRS method described in section EW 15C .
2: In section EW 15(1)(b) ignoring non-contingent fees; and ignoring—
i: non-contingent fees, if the relevant method is not the IFRS method described in section EW 15C
ii: non-integral fees, if the relevant method is the IFRS method described in section EW 15C .
3: In section EW 15 non-integral fee
4: Subsections (1) to (3)
a: the 2007–08 and later income years, unless paragraph (b) (c)
b: the first income year for which a person adopts IFRSs for the purposes of financial reporting and later income years, if that first income year is before the 2007–08 income year and the person chooses to apply the IFRS taxpayer method in a return of income for that first year; or
c: the 2008–09 and later income years, if a person's 2008–09 income year starts before 1 January 2008 and the person has not adopted IFRSs for the purposes of financial reporting before 1 January 2007.
60: New sections EW 15B to EW 15E inserted
1: After section EW 15
EW 15B: IFRS taxpayer method
Who this section applies to
1: This section applies to a person who is a party to a financial arrangement if the person uses IFRSs to prepare financial statements and to report for financial arrangements. IFRS taxpayer method
2: The person must use the IFRS taxpayer method, described in this section and in sections EW 15C to EW 15E Compulsory use of some determinations
3: The person must use 1 of the following methods for the financial arrangement, if the terms of the relevant method allow,—
a: Determination G5C: Mandatory conversion convertible notes
b: Determination G22: Optional conversion convertible notes denominated in New Zealand dollars convertible at the option of the holder
c: Determination G22A: Optional convertible notes denominated in New Zealand dollars
d: Determination G29: Agreements for sale and purchase of property denominated in foreign currency: exchange rate to determine the acquisition price and method for spreading income and expenditure
e: an alternative method to 1 of those methods described in paragraphs (a) to (d)
i: has regard to the purposes of the financial arrangements rules under section EW 1(3)
ii: is for financial arrangements similar to those arrangements to which the methods described in paragraphs (a) to (d)
iii: results in the allocation to each income year of amounts that are not materially different from those that would have been allocated using 1 of those methods described in paragraphs (a) to (d) Compulsory use of other methods for certain arrangements
4: The person must use 1 of the methods in subsection (5)
a: the person is not required under subsection (3)
b: the financial arrangement—
i: includes an excepted financial arrangement:
ii: is treated by the person or the issuer of the financial arrangement as an equity instrument in whole or in part under IFRSs:
iii: is an agreement for the sale and purchase of property or services; and
c: the terms of the relevant method allow. Methods for arrangements under subsection (4)
5: The methods referred to in subsection (4)
a: the yield to maturity method:
b: Determination G26: Variable rate financial arrangements
c: a determination made by the Commissioner under section 90AC(1)(bb) of the Tax Administration Act 1994
d: an alternative method to 1 of those methods described in paragraphs (a) to (c)
i: has regard to the purposes of the financial arrangements rules under section EW 1(3)
ii: is for financial arrangements similar to those arrangements to which the methods described in paragraphs (a) to (c)
iii: results in the allocation to each income year of amounts that are not materially different from those that would have been allocated using 1 of those methods described in paragraphs (a) to (c) IFRS method and 3 alternatives
6: If the person is not required under subsection (3) or (4)
a: the IFRS method described in section EW 15C
b: a determination alternative to IFRS described in section EW 15D
c: the expected value method described in section EW 15E
d: the equity-free fair value method described in section EW 15E Equity instrument
7: In this section, equity instrument equity instrument financial arrangement financial arrangements rules financial statements IFRS IFRS taxpayer method income year NZIAS 32
EW 15C: IFRS method
Who this section applies to
1: This section applies to a person and a financial arrangement if—
a: section EW 15B(6)
b: the person does not use section EW 15D or EW 15E IFRS method
2: The person must allocate an amount to an income year for the financial arrangement in accordance with IFRSs, as modified by subsection (3) Modification of IFRS method
3: When a person applies the IFRS method, the following modifications are made to the method, if relevant:
a: an amount arising from an impaired credit adjustment under IFRSs is not allocated to an income year, if the financial arrangement is a financial asset:
b: an amount arising from the fair value method under IFRSs is allocated to an income year, even though the amount is allocated to equity reserves under IFRSs. Impaired credit adjustment
4: In this section, impaired credit adjustment
a: for a financial arrangement accounted for using the fair value method, the movement in fair value due to the decline in credit quality of the arrangement:
b: for a financial arrangement not accounted for using the fair value method, credit impairment adjustments made under IFRSs. amount Commissioner fair value method financial arrangement impaired credit adjustment IFRS income year
EW 15D: Determination alternatives to IFRS
Who this section applies to
1: This section applies to a person and a financial arrangement if—
a: section EW 15B(6)
b: the person chooses in a return of income to use a determination alternative to IFRS for the financial arrangement; and
c: the terms of the relevant method, as modified by subsection (3)
d: the financial arrangement is not treated under IFRSs as a hedge of a financial arrangement ( financial arrangement A
i: section EW 15C
ii: the method used for financial arrangement A is or was the fair value method or a method that accounts for gains and losses related to the hedge. Determination alternatives to IFRS
2: The person must use 1 of the following methods for the financial arrangement, as modified by subsection (3)
a: Determination G9C: Financial arrangements that are denominated in a currency other than New Zealand dollars: an expected value approach
b: Determination G14B: Forward contracts for foreign exchange and commodities: an expected value approach
c: Determination G27: Swaps
d: a determination made by the Commissioner under section 90AC(1)(bb) of the Tax Administration Act 1994
e: an alternative method to 1 of those described in paragraphs (a) to (d)
i: has regard to the purposes of the financial arrangements rules under section EW 1(3)
ii: is for financial arrangements similar to those arrangements to which the methods described in paragraphs (a) to (d)
iii: results in the allocation to each income year of amounts that are not materially different from those that would have been allocated using 1 of those described in paragraphs (a) to (d) Determination alternatives to IFRS: G9C and G14B modified
3: When a person applies a determination alternative to IFRS that is Determination G9C Determination G14B
a: the term forward contract
b: a requirement that all members of a group of companies to which the person belongs make an election to use the determination alternative is treated as met if—
i: all members of the group of companies make an election on or before the 63rd day after the person enters into the relevant financial arrangement, or they make the election within such further time as the Commissioner may allow; and
ii: the financial arrangement is the first financial arrangement of the group of companies for which Determination G9C Determination G14B
iii: the election is in writing; and
iv: the election is for Determination G9C Determination G14B amount Commissioner fair value method financial arrangement financial arrangements rules forward contract group of companies IFRS
EW 15E: Expected value method and equity-free fair value method
Who this section applies to
1: This section applies to a person and a financial arrangement if—
a: section EW 15B(6)
b: the financial arrangement is denominated in a currency other than New Zealand dollars or is a derivative instrument; and
c: the financial arrangement is not treated under IFRSs as a hedge of a financial arrangement ( financial arrangement A
i: section EW 15C
ii: the method used for financial arrangement A is or was the fair value method or a method that accounts for gains and losses related to the hedge; and
d: the person is not in the business of dealing in the financial arrangement; and
e: the person has entered into the financial arrangement in the ordinary course of their business; and
f: the person and all members of a group of companies to which the person belongs have chosen to use the expected value method described in subsection (2) subsection (3) Expected value method
2: A person who has chosen under subsection (1)(f)
a: has the features of an expected value approach described in Determination G9C Determination Gl4B
b: allocates a reasonable amount, having regard to the purposes of the financial arrangements rules under section EW 1(3) Equity-free fair value method
3: If the person chooses under subsection (1)(f) Derivative instrument
4: In this section, derivative instrument amount Commissioner derivative instrument fair value method financial arrangement financial arrangements rules IFRS IFRS taxpayer method income year NZIAS 39 tax year .
2: Subsection (1)
a: the 2007–08 and later income years, unless paragraph (b) (c)
b: the first income year for which a person adopts IFRSs for the purposes of financial reporting and later income years, if that first income year is before the 2007–08 income year and the person chooses to apply the IFRS taxpayer method in a return of income for that first year; or
c: the 2008–09 and later income years, if a person's 2008–09 income year starts before 1 January 2008 and the person has not adopted IFRSs for the purposes of financial reporting before 1 January 2007.
61: Yield to maturity method or alternative
1: In section EW 16(1) method method, if the person is not required to use the IFRS taxpayer method by section EW 15B
2: In section EW 16(2) method, method if the person is not required to use the IFRS taxpayer method by section EW 15B
3: In section EW 16 IFRS taxpayer method
4: Subsections (1) to (3)
a: the 2007–08 and later income years, unless paragraph (b) (c)
b: the first income year for which a person adopts IFRS s for the purposes of financial reporting and later income years, if that first income year is before the 2007–08 income year and the person chooses to apply the IFRS taxpayer method in a return of income for that first year; or
c: the 2008–09 and later income years, if a person's 2008–09 income year starts before 1 January 2008 and the person has not adopted IFRSs for the purposes of financial reporting before 1 January 2007.
62: Straight-line method
1: In section EW 17(1)(b) EW 25(1). EW 25(1); and
c: the person is not required to use the IFRS taxpayer method by section EW 15B
2: In section EW 17 IFRS taxpayer method
3: Subsections (1) (2)
a: the 2007–08 and later income years, unless paragraph (b) (c)
b: the first income year for which a person adopts IFRSs for the purposes of financial reporting and later income years, if that first income year is before the 2007–08 income year and the person chooses to apply the IFRS taxpayer method in a return of income for that first year; or
c: the 2008–09 and later income years, if a person's 2008–09 income year starts before 1 January 2008 and the person has not adopted IFRSs for the purposes of financial reporting before 1 January 2007.
63: Market valuation method
1: In section EW 18(1)(f) way). way); and
g: the person is not required to use the IFRS taxpayer method by section EW 15B
2: In section EW 18 IFRS taxpayer method
3: Subsections (1) (2)
a: the 2007–08 and later income years, unless paragraph (b) (c)
b: the first income year for which a person adopts IFRSs for the purposes of financial reporting and later income years, if that first income year is before the 2007–08 income year and the person chooses to apply the IFRS taxpayer method in a return of income for that first year; or
c: the 2008–09 and later income years, if a person's 2008–09 income year starts before 1 January 2008 and the person has not adopted IFRSs for the purposes of financial reporting before 1 January 2007.
64: Choice among first 3 spreading methods
1: In the heading to section EW 19 first 3 YTM or alternative, SL, and MV
2: In section EW 19
a: A person who A person who is not required to use the IFRS taxpayer method and who
b: in the list of defined terms, IFRS taxpayer method
3: Subsections (1) (2)
a: the 2007–08 and later income years, unless paragraph (b) (c)
b: the first income year for which a person adopts IFRSs for the purposes of financial reporting and later income years, if that first income year is before the 2007–08 income year and the person chooses to apply the IFRS taxpayer method in a return of income for that first year; or
c: the 2008–09 and later income years, if a person's 2008–09 income year starts before 1 January 2008 and the person has not adopted IFRSs for the purposes of financial reporting before 1 January 2007.
65: Determination method or alternative
1: In section EW 20(1)(b)(ii) do so. do so; and
c: the person is not required to use the IFRS taxpayer method by section EW 15B
2: After section EW 20(2)(b)
bb: the person is not required to use the IFRS taxpayer method by section EW 15B .
3: In section EW 20 IFRS taxpayer method
4: Subsections (1) to (3)
a: the 2007–08 and later income years, unless paragraph (b) (c)
b: the first income year for which a person adopts IFRSs for the purposes of financial reporting and later income years, if that first income year is before the 2007–08 income year and the person chooses to apply the IFRS taxpayer method in a return of income for that first year; or
c: the 2008–09 and later income years, if a person's 2008–09 income year starts before 1 January 2008 and the person has not adopted IFRSs for the purposes of financial reporting before 1 January 2007.
66: Section EW 21 repealed
1: Section EW 21
2: Subsection (1)
a: the 2007–08 and later income years, unless paragraph (b) (c)
b: the first income year for which a person adopts IFRSs for the purposes of financial reporting and later income years, if that first income year is before the 2007–08 income year and the person chooses to apply the IFRS taxpayer method in a return of income for that first year; or
c: the 2008–09 and later income years, if a person's 2008–09 income year starts before 1 January 2008 and the person has not adopted IFRSs for the purposes of financial reporting before 1 January 2007.
67: Default method
1: In section EW 22(c) , or a financial reporting method
2: Section EW 22(d)
3: Subsections (1) (2)
a: the 2007–08 and later income years, unless paragraph (b) (c)
b: the first income year for which a person adopts IFRSs for the purposes of financial reporting and later income years, if that first income year is before the 2007–08 income year and the person chooses to apply the IFRS taxpayer method in a return of income for that first year; or
c: the 2008–09 and later income years, if a person's 2008–09 income year starts before 1 January 2008 and the person has not adopted IFRSs for the purposes of financial reporting before 1 January 2007.
68: Failure to use method for financial reporting purposes
1: In section EW 23(1) and (2) EW 20(2)(f), and EW 21(e) and EW 20(2)(f)
2: After section EW 23(3) Relationship with subject matter: transitional rule for IFRS financial reporting
4: This section is modified by section EZ 50
3: Subsections (1) (2)
a: the 2007–08 and later income years, unless paragraph (b) (c)
b: the first income year for which a person adopts IFRSs for the purposes of financial reporting and later income years, if that first income year is before the 2007–08 income year and the person chooses to apply the IFRS taxpayer method in a return of income for that first year; or
c: the 2008–09 and later income years, if a person's 2008–09 income year starts before 1 January 2008 and the person has not adopted IFRSs for the purposes of financial reporting before 1 January 2007.
69: Consistency of use of spreading method
1: After section EW 24(2) IFRS taxpayer method
2B: Section EW 25B
2: In section EW 24 IFRS taxpayer method
3: Subsections (1) (2)
a: the 2007–08 and later income years, unless paragraph (b) (c)
b: the first income year for which a person adopts IFRSs for the purposes of financial reporting and later income years, if that first income year is before the 2007–08 income year and the person chooses to apply the IFRS taxpayer method in a return of income for that first year; or
c: the 2008–09 and later income years, if a person's 2008–09 income year starts before 1 January 2008 and the person has not adopted IFRSs for the purposes of financial reporting before 1 January 2007.
70: New section EW 25B inserted
1: After section EW 25
EW 25B: Consistency of use of specific individual methods under IFRS taxpayer method
Consistency for financial arrangement
1: A person using a specific individual method under 1 of the 4 methods described in section EW 15B(6)
a: the remaining term of the financial arrangement, until section EW 29
b: other financial arrangements that are the same as, or similar to, the financial arrangement, unless different accounting treatments under IFRSs are used for those financial arrangements. Exception: change allowed
2: Subsection (1)(a)
a: the person may use the new specific individual method under the IFRS taxpayer method; and
b: the accounting treatment for the relevant financial arrangement under IFRSs is changed for the purposes of financial reporting in the same income year as the change in specific individual method. Change allowed: spreading method adjustment
3: When a person changes their specific individual method under subsection (2) sections EW 26(3), (4), and EW 27 section EW 26(2) Exception: no spreading method adjustment for change from fair value method
4: Despite subsection (3) of this section sections EW 26(3), (4), and EW 27 section EW 15C section EW 29(13) fair value method financial arrangement IFRS IFRS taxpayer method income year .
2: Subsection (1)
a: the 2007–08 and later income years, unless paragraph (b) (c)
b: the first income year for which a person adopts IFRSs for the purposes of financial reporting and later income years, if that first income year is before the 2007–08 income year and the person chooses to apply the IFRS taxpayer method in a return of income for that first year; or
c: the 2008–09 and later income years, if a person's 2008–09 income year starts before 1 January 2008 and the person has not adopted IFRSs for the purposes of financial reporting before 1 January 2007.
71: Change of spreading method
1: In section EW 26 Exception: fair value method
6: Despite subsection (3) subsection (4), and section EW 27 section EW 15C section EW 29(13) Sound commercial reason
7: In this section, sound commercial reason
a: starting to use or ceasing to use IFRSs to prepare financial statements:
b: starting to use, for the first time, the IFRS taxpayer method for a financial arrangement.
2: In section EW 26 fair value method financial statements IFRS sound commercial reason
3: Subsections (1) (2)
a: the 2007–08 and later income years, unless paragraph (b) (c)
b: the first income year for which a person adopts IFRSs for the purposes of financial reporting and later income years, if that first income year is before the 2007–08 income year and the person chooses to apply the IFRS taxpayer method in a return of income for that first year; or
c: the 2008–09 and later income years, if a person's 2008–09 income year starts before 1 January 2008 and the person has not adopted IFRSs for the purposes of financial reporting before 1 January 2007.
72: When calculation of base price adjustment required
1: After section EW 29(12) Change from fair value method under IFRS method
13: A party to a financial arrangement who, for the financial arrangement, changes from the fair value method under the IFRS method described in section EW 15C
2: In section EW 29 fair value method
3: Subsections (1) (2)
a: the 2007–08 and later income years, unless paragraph (b) (c)
b: the first income year for which a person adopts IFRSs for the purposes of financial reporting and later income years, if that first income year is before the 2007–08 income year and the person chooses to apply the IFRS taxpayer method in a return of income for that first year; or
c: the 2008–09 and later income years, if a person's 2008–09 income year starts before 1 January 2008 and the person has not adopted IFRSs for the purposes of financial reporting before 1 January 2007.
73: Base price adjustment formula
1: In section EW 31(7) ignoring contingent fees. ignoring—
i: non-contingent fees, if the relevant method is not the IFRS method described in section EW 15C
ii: non-integral fees, if the relevant method is the IFRS method described in section EW 15C
2: In section EW 31 non-integral fee
3: Subsections (1) (2)
a: the 2007–08 and later income years, unless paragraph (b) (c)
b: the first income year for which a person adopts IFRSs for the purposes of financial reporting and later income years, if that first income year is before the 2007–08 income year and the person chooses to apply the IFRS taxpayer method in a return of income for that first year; or
c: the 2008–09 and later income years, if a person's 2008–09 income year starts before 1 January 2008 and the person has not adopted IFRSs for the purposes of financial reporting before 1 January 2007.
74: New heading and new section EW 48B inserted
1: After section EW 48 Consideration when change from fair value method under IFRS method
EW 48B: Consideration when change from fair value method under IFRS method
Who this section applies to
1: This section applies to a party to a financial arrangement who, for the financial arrangement,—
a: changes from the fair value method under the IFRS method described in section EW 15C
b: must calculate a base price adjustment as at the date of the change, as provided by section EW 29(13)
2: A person is treated as having been paid, on the date of the change, an amount of consideration equal to the financial arrangement's market value on that date. amount consideration fair value method financial arrangement .
2: Subsection (1)
a: the 2007–08 and later income years, unless paragraph (b) (c)
b: the first income year for which a person adopts IFRSs for the purposes of financial reporting and later income years, if that first income year is before the 2007–08 income year and the person chooses to apply the IFRS taxpayer method in a return of income for that first year; or
c: the 2008–09 and later income years, if a person's 2008–09 income year starts before 1 January 2008 and the person has not adopted IFRSs for the purposes of financial reporting before 1 January 2007.
75: Meaning of CFC
In section EX 1(1B) 1 of the tests a test
76: Options and similar rights in certain cases
1: In section EX 11(3)(b) under sections EX 14 to EX 17 10%
2: Subsection (1)
77: Associates and 10% threshold
1: Section EX 15(1)
1: For the purpose of applying the 10% threshold in section EX 14
2: Subsection (1)
78: Branch equivalent income or loss: calculation rules
In section EX 21(30) FC 8I FC 8H
79: CFC rules exemption
1: In section EX 32(b) , under sections EX 14 to EX 17 falls
2: Subsection (1)
80: Exemptions: direct income interests in FIF in grey list country
1: In section EX 33(3)(c) subparagraph (i)
c: the person has held shares in the company at all times after a time when— .
2: Section EX 33(3)(d)(i)
i: carried on a business in New Zealand; and .
3: Section EX 33(3)(g)(i) and (ii)
i: incurs in the year expenditure, other than interest, equal to or more than the lesser of $1,000,000 and 25% of the total expenditure, other than interest, incurred by the company in the year:
ii: at all times in the year, engages a number of fulltime employees or contractors equal to or more than the lesser of 10 and 25% of the total number engaged by the company.
4: Section EX 33(4)(c)
c: the person has held shares in the grey list company at all times after a time when the shares were not listed on a recognised exchange; and .
5: Section EX 33(4)(d)
d: at all times in the year, the grey list company holds more than 50% of the voting interests in a company (the resident company
i: carried on a business in New Zealand; and
ii: had in New Zealand more than 50% of the resident company's assets and employees; and .
6: Section EX 33(4)(f)(i) and (ii)
i: incurs in the year expenditure, other than interest, equal to or more than the lesser of $1,000,000 and 25% of the total expenditure, other than interest, incurred by the company in the year:
ii: at all times in the year, engages a number of fulltime employees or contractors equal to or more than the lesser of 10 and 25% of the total number engaged by the company.
7: After section EX 33(4) Shares acquired under venture investment agreement
4B: A person's rights in a FIF that is a grey list company at a time in an income year are not an attributing interest at the time if the person first acquires a share or option to buy a share in the company—
a: under a venture investment agreement; and
b: at the same time and on the same terms as an acquisition of an interest in the FIF by the Venture Investment Fund or a company owned by the Venture Investment Fund.
8: Section EX 33(5)(f)
f: the share purchase agreement includes a restriction on the disposal of the shares; and .
9: In section EX 33 non-resident
81: Exemptions limited by income years: shares in certain grey list companies
1: Section EX 33B(1)
1: A person's rights in a FIF are not an attributing interest in an income year beginning before 1 April 2012 if—
a: the rights are shares (the shares company
b: on 17 May 2006, the company—
i: is not an entity described in schedule 4
ii: has more than 20 000 shareholders who have addresses in New Zealand on the company's share register in New Zealand; and
iii: has shareholders referred to in subparagraph (ii)
iv: is liable to income tax in a country listed in the grey list; and
v: has assets of which more than 50% in total value are shares in other companies carrying voting interests of more than 50%; and
c: on 17 May 2006, the shares—
i: are listed on a recognised exchange in New Zealand; and
ii: are listed on a recognised exchange in a grey list country; and
d: in the period of 30 days beginning from 18 December 2006, the company gives to the Commissioner the notice required by paragraph (b) section 81 of the Taxation (Business Taxation and Remedial Matters) Act 2007
2: Section EX 33B(2)
2: A person's rights in a FIF are not an attributing interest in an income year beginning before 1 April 2009 if—
a: the rights are shares (the shares company
b: on 17 May 2006, the company—
i: is not an entity described in schedule 4
ii: has shareholders of which more than 40% have addresses in New Zealand on the company's share register in New Zealand; and
iii: has shareholders referred to in subparagraph (ii)
iv: is liable to income tax in a country listed in the grey list; and
v: has assets of which 50% or more in total value are shares in other companies each of which is resident in New Zealand; and
vi: has assets of which 90% or more in total value are shares in other companies each of which is resident in Australia or New Zealand and is listed on a recognised exchange in Australia or New Zealand; and
c: on 17 May 2006, the shares—
i: are listed on a recognised exchange in New Zealand; and
ii: are listed on a recognised exchange in a grey list country; and
d: in the period of 30 days beginning from 18 December 2006, the company gives to the Commissioner the notice required by paragraph (b) section 81 of the Taxation (Business Taxation and Remedial Matters) Act 2007
e: at all times in the year, the company—
i: has assets of which 50% or more in total value are shares in other companies each of which is resident in New Zealand; and
ii: has assets of which 90% or more in total value are shares in other companies each of which is resident in Australia or New Zealand and is listed on a recognised exchange in Australia or New Zealand.
82: Exemption: shares in listed Australian company
1: Section EX 33C Exemption
1: A person's rights in a FIF in an income year are not an attributing interest if—
a: the rights are a share; and
b: the share is not a share that may not, or ordinarily may not, be disposed of unless together with rights in another company; and
c: the FIF is a company that meets the requirements of subsection (2) Australian listed company on approved index
2: The company must—
a: at all times in the income year when the person holds a right in the company, be resident in Australia; and
b: at all times in the income year when the person holds a right in the company, not be treated as resident in a country other than Australia under and for the purposes of an agreement that—
i: is between Australia and the other country; and
ii: would be a double tax agreement if negotiated between New Zealand and the other country; and
c: have shares included in an index that is an approved index under the ASX Market Rules, made under Chapter 7 of the Corporations Act 2001 (Aust)
i: at the beginning of the income year, if subparagraph (ii)
ii: when the person acquires the shares, if the person does not own shares in the company earlier in the income year; and
d: at all times in the income year when the person holds a right in the company, not be an entity described in schedule 4
e: at all times in the income year when the person holds a right in the company, be required under the Income Tax Assessment Act 1997 (Aust) Income Tax Assessment Act 1936 (Aust)
2: In section EX 33C direct income interest income income tax
83: Exemption: units in certain Australian unit trusts
1: Section EX 33D(1)(c) to (e)
c: at all times in the year when the person holds a right in the FIF, the unit trust is resident in Australia; and
d: at all times in the year when the unit trust makes a distribution to investors, there is an RWT proxy under section NF 2AA
e: the unit trust meets the requirements of—
i: subsection (2) held shares trust's year
ii: subsection (4)
2: Section EX 33D(2) to (4) Requirements for unit trust's assets that are shares
2: A unit trust meets the requirements of this subsection if the total market value of the held shares exceeds the total cost of the held shares by an amount that is less than or equal to 3 times the amount calculated using the formula— disposal proceeds - share costs. Definition of items in formula
3: In the formula in subsection (2)
a: disposal proceeds
b: share costs paragraph (a) Requirements for unit trust's distributions
4: A unit trust meets the requirements of this subsection if the total amount of distributions by the unit trust during the trust's year is equal to or more than the amount calculated using the formula— Definition of items in formula
5: In the formula in subsection (4)
a: closing
b: opening
c: contributions Currency of amounts in subsections (2) to (5)
6: In subsections (2) to (5)
3: In section EX 33D accounting year
84: Limits on choice of calculation methods
1: Section EX 40(6)(b)
b: the attributing interest does not meet the requirements of subsection (8)(a) .
2: Section EX 40(6)(d)
d: the person is the trustee of a trust that—
i: has no gifting senior who is not a natural person or deceased person; and
ii: at all times in the income year, would be a qualifying trust for a distribution made at the time; and
iii: is mainly for the benefit of an organisation or trust with income that is exempt income under section CW 34 or CW 35
iv: is not a superannuation scheme.
3: Section EX 40(8)(a)
a: the attributing interest is—
i: of a type that the Commissioner has determined under section 91AAO of the Tax Administration Act 1994
ii: not of a type that is listed in subsection (9) .
4: Section EX 40(9) Fair dividend rate method: interests for which method not applicable
9: An attributing interest of a person (the investor subsection (8)(a)(i) subsection (8)
a: of a type that the Commissioner has determined under section 91AAO of the Tax Administration Act 1994
b: a fixed rate share under section LF 2(3)
c: a non-participating redeemable share:
d: an interest in a non-resident having assets of which 80% or more by value consist of financial arrangements denominated in New Zealand dollars:
e: a share that involves an obligation—
i: of another person to provide to the investor an amount exceeding the issue price of the share; and
ii: that is direct to the investor or indirect through an arrangement; and
iii: that is non-contingent or subject to a contingency that is sufficiently remote to be immaterial. Meaning of gifting settlor
9B: A gifting settlor relevant trust
a: a settlor, under section HH 1(1) paragraph (a)(i)
i: the relevant trust:
ii: a trust with a trustee who settles property on the relevant trust, directly or through the trustees of other trusts; and
b: not the trustee of a trust.
85: Use of particular calculation methods required
In section EX 40B paragraph (a) section EX 40(8)(a) section EX 40(8)(a)(ii)
86: Default calculation method
Section EX 41(2)(b)(ii) and (iii)
ii: the comparative value method, if subparagraph (i)
iii: the deemed rate of return method, if subparagraph (i)
87: Comparative value method
1: In section EX 44(4) tax that the person is allowed as a credit under section amount that the person is allowed as a credit under section LB 2
2: Section EX 44(6B)(b)
b: that meets the requirements of section EX 40(8)(a)
88: Fair dividend rate method
1: Section EX 44B(2)
2: For a person who is not a unit valuer, the FIF income or loss for an income year from the attributing interests in FIFs for which the person uses the fair dividend rate method is the amount calculated for the income year using the method in—
a: section EX 44C paragraph (b)
b: section EX 44D
i: determines the market value of the attributing interest for each period of a day in the income year; and
ii: chooses that this paragraph apply.
2: After section EX 44B(4) Treatment of attributing interests subject to returning share transfer
5: If an attributing interest in a BF is an original share subject to a returning share transfer, for the purposes of a person using the fair dividend rate method to calculate FIF income or loss, the attributing interest is treated as being held by the share supplier.
89: Fair dividend rate method: usual method
1: In section EX 44C(4)(b) year. year; and
c: that are not, at the beginning of the income year, included in a direct income interest of 10% or more in a grey list company.
2: Section EX 44C(5)(b)(ii)
ii: the amount (the quick sale gains subsection (10B)
3: In section EX 44C(10)(b) incurs during the income year in acquiring or increasing incurs in acquiring or increasing during the income year
4: After section EX 44C(10) Quick sale gains
10B: The quick sale gains is the greater of zero and the total for the income year of amounts calculated, for each attributing interest that is both acquired and disposed of in the income year, using the formula— return - (interest x average cost). Definition of items in formula
10C: In the formula,—
a: return
b: interest
c: average cost
5: In section EX 44C(11) paragraph (a) or is incurred on or is derived from or incurred on
6: In section EX 44C(11)(a) incurred derived or incurred
7: After section EX 44C(12) Treatment of deemed transaction under section EX 51 or EX 54B
13: If a person is treated under section EX 51(5) or EX 54B subsection (5)
90: Fair dividend rate method: method for entities that value investors' units
1: In the heading to section EX 44D entities that value investors' units unit valuers and persons valuing interests daily
2: Section EX 44D(1) FIF income
1: If this section applies to an entity or person (the entity subsection (2) unit valuation period
3: In section EX 44D(4)(b) period. period; and
c: that are not, at the beginning of the income year, included in a direct income interest of 10% or more in a grey list company.
4: Section EX 44D(7)(c)(ii)
ii: the amount (the quick sale gains subsection (12B)
5: In section EX 44D(12)(b) incurs during the unit valuation period in acquiring or increasing incurs in acquiring or increasing during the unit valuation period
6: After section EX 44D(12) Quick sale gains
12B: The quick sale gains is the greater of zero and the total for the unit valuation period of amounts calculated, for each attributing interest that is both acquired and disposed of in the unit valuation period, using the formula— return - (interest x average cost). Definition of items in formula
12C: In the formula—
a: return
b: interest
c: average cost
7: In section EX 44D(13) paragraph (a) or is incurred on or is derived from or incurred on
8: In section EX 44D(13)(a) incurred derived or incurred
9: After section EX 44D(14) Treatment of deemed transaction under section EX 54B
15: If a person is treated under section EX 54B subsection (7)
91: Fair dividend rate method and cost method: calculating items in formulas for periods affected by share reorganisations
In section EX 44E(4) incurs during the affected period in acquiring or increasing incurs in acquiring or increasing during the affected period
92: Cost method
1: After section EX 45B(4)(a)
ab: the amount that is shown as the net asset value of the interest in audited financial statements of the person for the relevant income year made available to the general public, if—
i: paragraph (a)
ii: the FIF makes available to the general public audited financial statements for its accounting year ending in the relevant income year; and
iii: the person chooses that this paragraph apply; or
ac: the amount of the cost of the interest, if—
i: paragraphs (a) and (ab)
ii: the person acquires the interest in the 2005–06 or 2006–07 income year; or .
2: In section EX 45B(4)(b) subparagraph (i) paragraphs (a), (ab), and (ac) if
3: In section EX 45B(4)(b)(i) for which the person has FIF income or loss attributing interest
4: In section EX 45B(4)(c) paragraphs (a), (ab), (ac), and (b) if
5: In section EX 45B(4)(d) paragraphs (a), (ab), (ac), and (b) if
6: In section EX 45B(4)(e) paragraphs (a), (ab), (ac), and (b) if
7: In section EX 45B(6)(b) incurs during the relevant income year in acquiring or increasing incurs in acquiring or increasing during the relevant income year
8: In section EX 45B(6)(c) section EX 44C section EX 44E
9: In section EX 45B(11)(b) section EX 44C section EX 44E
10: In section EX 45B(12)(b) incurs during the income year before the relevant income year in acquiring or increasing incurs in acquiring or increasing during the income year before the relevant income year
11: In section EX 45B(12)(c) section EX 44C section EX 44E
93: Codes: comparative value method, deemed rate of return method, fair dividend rate method, and cost method
Section EX 47(1)(c)
c: the fair dividend rate method, if—
i: the FIF is not a grey list company:
ii: the person does not hold a direct income interest of 10% or more in the FIF at the beginning of the income year of the period: .
94: Limits on changes of method
1: In section EX 50(1) subsections (2) to (7) subsections (2) to (8)
2: Section EX 50(8)(a) to (d)
a: has no gifting settlor who is not a natural person or deceased person; and
b: at all times in the income year, would be a qualifying trust for a distribution made at the time; and
c: is mainly for the benefit of—
i: an organisation or trust with income that is exempt income under section CW 34 or CW 35
ii: at all times in the income year, a natural person for whom the gifting settlors of the trust have natural love and affection or had natural love and affection when alive; and
d: is not a superannuation scheme.
95: Consequences of changes in method
1: In section EX 51(4)(c)(ii) year; or year.
2: After section EX 51(4) Changes between comparative value method and fair dividend rate method
5: If a person holding an attributing interest in a FIF changes from either of the comparative value method and the fair dividend rate method to the other of the comparative value method and the fair dividend rate method for calculating the FIF income or loss from the interest, the person is treated as having—
a: disposed of the interest to an unrelated person immediately before the start of the first income year to which the new method applies; and
b: reacquired the interest at the start of the income year; and
c: received for the disposal and paid for the reacquisition an amount equal to the market value of the interest at the time of the disposal.
96: FIF rules first applying to interest for income year beginning on or after 1 April 2007
1: Section EX 54B(1) When this section applies
1: This section applies when a person has rights in a FIF that—
a: for the period ending on a day (the preceding day
i: not an attributing interest:
ii: an attributing interest for which the person does not have FIF income or loss:
iii: rights for which the person is a share supplier in a returning share transfer; and
b: for the period beginning on the day (the application day
2: Section EX 54B(2)(b)
b: reacquired the interest at the beginning of the application day; and .
3: In section EX 54B(3)
a: in the words before paragraph (a) the disposal and acquisition referred to in subsection (2) the disposals in an income year, and related acquisitions, treated as occurring under this section
b: in paragraph (a)(i) disposal is disposals are
c: in paragraph (a)(ii) disposal is disposals are
d: in paragraph (a)(iii) disposal is disposals are
e: in paragraph (b) disposal disposals
97: Measurement of cost
Section EX 56(2) FIFO cost flow identification
2: If sections EX 44C(12) and EX 44D(14) FIFO
98: Policyholder income formula
1: Section EY 42(1) Formula
1: The policyholder income formula
2: After section EY 42(5) FDR adjustment
5B: FDR adjustment section EY 42B PIE adjustment
5C: PIE adjustment section EY 42C
3: Subsections (1) (2)
a: for the 2008–09 and later income years, unless they make an election under paragraph (b) (c)
b: on and after 1 October 2007, if they make an election under this paragraph, stating the relevant date in a notice received by the Commissioner before 1 April 2008; or
c: for an income year beginning on or after 1 April 2007, if they make an election under this paragraph, stating the relevant date in a notice received by the Commissioner before 1 April 2008.
99: New sections EY 42B and EY 42C inserted
1: After section EY 42
EY 42B: Policyholder income formula: FDR adjustment
When this section applies
1: This section applies for the purposes of section EY 42(5B)
a: the property is an attributing interest in a FIF held by the life insurer, or by a portfolio tax rate entity that the life insurer has directly or indirectly invested in; and
b: the life insurer or the portfolio tax rate entity uses the fair dividend rate method for the property; and
c: section EY 42C When has life insurer indirectly invested in portfolio tax rate entity?
2: For the purposes of subsection (1) PTRE A FDR adjustment
3: In using the policyholder income formula, the life insurer may calculate the item FDR adjustment
a: using the formula in subsection (5)
b: by calculating, using any reasonable method for the information available to the life insurer, the amount credited to actuarial reserves in relation to the property, but excluding amounts which are related to FIF income under the fair dividend rate method. Consistency requirement
4: A life insurer, in using the policyholder income formula, must calculate the item FDR adjustment subsection (3)(a) or (b) Formula
5: The formula described in subsection (3)(a) FDR adjustment 0.6 x (FIF result - FDR income). Definition of items in formula
6: The items in the formula are defined in subsections (7) and (8) FIF result
7: FIF result FDR income
8: FDR income amount attributing interest fair dividend rate method FIF FIF income FIF loss income portfolio investment entity portfolio investment-linked life fund
EY 42C: Policyholder income formula: PILF adjustment
When this section applies
1: This section applies for the purposes of section EY 42(5C)
a: an attributing interest in a FIF,—
i: held by the life insurer, or by a portfolio tax rate entity that the life insurer has directly or indirectly invested in; and
ii: for which the life insurer or the portfolio tax rate entity uses the fair dividend rate method for the property:
b: shares described in section CX 44C When has life insurer indirectly invested in portfolio tax rate entity?
2: For the purposes of subsection (1) PTRE A PIE adjustment
3: In using the policyholder income formula, the life insurer may calculate the item PILF adjustment
a: using the formula in subsection (5)
b: by calculating, using any reasonable method for the information available to the life insurer, the amount credited to actuarial reserves in relation to the property, but excluding amounts that are—
i: related to FIF income under the fair dividend rate method:
ii: dividends or distributions for shares described subsection (1)(b) section CX 44D(2) Consistency requirement
4: A life insurer, in using the policyholder income formula, must calculate the item PILF adjustment subsection (3)(a) or (b) Formula
5: The formula described in subsection (3)(a) PILF adjustment 0.9 x (FIF result - FDR income) + 0.9 x excluded shares. Definition of items in formula
6: The items in the formula are defined in subsections (7) to (9) FIF result
7: FIF result subsection (1)(a) FDR income
8: FDR income subsection (1)(a) Excluded shares
9: Excluded shares subsection (1)(b)
a: the positive amount of income excluded by section CX 44C(2)
b: the negative amount of a deduction not allowed by section DB 17(3)(b)
c: the gains and losses for the shares, calculated using accepted accounting practice, but excluding—
i: amounts already accounted for under paragraph (a) or (b) of this subsection subsection (7)
ii: dividends and distributions for the shares, other than distributions from a portfolio tax rate entity to which section CX 44D(2) amount attributing interest deduction dividend excluded income fair dividend rate method FIF FIF income FIF loss income portfolio investment-linked life fund portfolio tax rate entity share .
2: Subsection (1) subsection (3) subsection (1) subsection (1)
3: Subsection (1)
a: on and after 1 October 2007, if the life insurer makes an election under this paragraph, stating the relevant date in a notice received by the Commissioner before 1 April 2008; or
b: for an income year beginning on or after 1 April 2007, if the life insurer makes an election under this paragraph, stating the relevant date in a notice received by the Commissioner before 1 April 2008.
100: New section EZ 50 inserted
After section EZ 49
EZ 50: Transitional rule for IFRS financial reporting method
When this section applies
1: This section applies for a financial arrangement when—
a: a person starts to use a spreading method for that financial arrangement before the person adopts IFRSs for the purposes of financial reporting; and
b: that spreading method does not comply with whichever is relevant of sections EW 16(2)(d), EW 18(f), and EW 20(2)(f)
c: the person is not required by section EW 15B
d: the income year is the 2007–08 income year or an earlier income year. Transitional rule
2: For the financial arrangement, the person is treated as complying with whichever is relevant of sections EW 16(2)(d), EW 18(f), and EW 20(2)(f) financial arrangement IFRS IFRS taxpayer method income year .
101: Sections FC 8H and FC 8I replaced
1: Sections FC 8H and FC 8I
FC 8H: Adjustment required if lease becomes finance lease
1: A lessor and a lessee must make an adjustment under this section if—
a: the lease is a consecutive or a successive lease—
i: that is deemed to be 1 lease under the definition of lease
ii: with a term of the lease that the lessor and lessee do not contemplate, at the start of the term, will be more than 75% of the personal property lease asset's estimated useful life; and
iii: with a term of the lease that is more than 75% of the asset's estimated useful life:
b: the lease is an operating lease that becomes a finance lease under paragraph (c) of the definition of finance lease
2: The lessor and lessee must each—
a: calculate an adjustment for the lease; and
b: include the adjustment in a return of income for the tax year corresponding to the income year in which the lease becomes a finance lease.
3: The amount of the adjustment is calculated in relation to the period described in subsection (5) finance income - finance expenditure - unadjusted income + unadjusted expenditure.
4: In the formula—
a: finance income
b: finance expenditure
c: unadjusted income
d: unadjusted expenditure
5: The period begins with the start of the term of the lease and ends with the end of the income year in which the lease becomes a finance lease.
6: If the adjustment is positive, the amount is income of the lessor or lessee in the income year in which the lease becomes a finance lease.
7: If the adjustment is negative, the amount is expenditure incurred by the lessor or lessee in the income year in which the lease becomes a finance lease.
FC 8I: Adjustment required for certain operating leases entered before 20 June 2007
1: A lessor must make an adjustment under this section if the lease is an operating lease—
a: entered before 20 June 2007; and
b: that is or is part of an arrangement meeting on 20 June 2007 the requirements of paragraph (c)(i) to (iii) of the definition of finance lease
c: with a term of the lease ending after the end of the income year including 20 June 2007; and
d: that does not meet the requirements of section FC 8H(1)(a)
2: The lessor must—
a: calculate an adjustment for the lease asset; and
b: include the adjustment in a return of income for the tax year corresponding to the income year after the income year including 20 June 2007.
3: The amount of the adjustment is calculated using the formula—
4: In the formula, total depreciation losses subsection (5)
5: The period begins with the start of the term of the lease and ends with the end of the income year including 20 June 2007.
6: The adjustment is income under the lease of the lessor in the income year after the income year including 20 June 2007.
7: The adjusted tax value of the lease asset at the beginning of the income year after the income year including 20 June 2007 is the total of the adjustment and the adjusted tax value that the lease asset would have in the absence of this section.
8: For an income year beginning after 20 June 2007 in which the lease is an operating lease, the depreciation loss allowed for the lease asset other than under section EE 41(2)
2: Subsection (1)
102: Variations in control or income interests in foreign companies
1: In section GC 9(4)(c) under sections EX 14 to EX 17 company
2: Subsection (1)
103: New section GC 14EB inserted
After section GC 14E
GC 14EB: Treatment of dividends as if from qualifying company
When this section applies
1: This section applies to a company (an attribution company section GC 14D dividend
a: has chosen to apply this section before paying the dividend; and
b: has not revoked the choice described in paragraph (a)
c: is not a qualifying company; and
d: has no net income for the tax year in which it pays the dividend that is not net income attributed under section GC 14D Treatment of dividends as if from qualifying company
2: For the attribution company and the dividend, section HG 13 attribution company business company dividend income interest qualifying company net income .
104: Tax credits for family support and family plus
1: The heading before section GC 28 Tax credits for families
2: In section GC 28 Tax credits for families
105: Dividends from qualifying company
1: In section HG 13(3)(a) section ME 8(1) section ME 8(1) section MZ 19
2: In section HG 13(4)(a) subsection (3) subsection (3) Section MZ 19
106: Scheme of subpart
1: Section HL 2(2) Election to be type of portfolio investment entity
2: An entity may choose under section HL 11
a: portfolio tax rate entity if the entity is—
i: a company, superannuation fund, or group investment fund; and
ii: eligible under section HL 3(1)
b: portfolio listed company if the entity is—
i: a company listed on a recognised exchange in New Zealand; and
ii: eligible under section HL 3(3)
c: portfolio defined benefit fund if the entity is—
i: a defined benefit fund; and
ii: eligible under section HL 3(5)
d: portfolio investment-linked life fund if the entity is—
i: a separate identifiable fund, forming part of a life insurer, holding investments subject to life insurance policies under which benefits are directly linked to the value of the investments held in the fund; and
ii: eligible under section HL 3(7)
2: In section HL 2(7)(c)(ii) period. period:
d: the amount of fees paid to the entity by the investor on the day:
e: the amount of rebates of fees credited to the investor by the entity on the day:
f: the amount of expenditure, for the income year ending with the day, transferred under subpart DV
107: Section HL 3 replaced
Section HL 3
HL 3: Eligibility requirements for entities
Eligibility requirements for entity electing to be portfolio tax rate entity
1: An entity that is choosing under section HL 11 subsections (9), (10), and (11) Eligibility requirements for portfolio tax rate entity
2: A portfolio tax rate entity must meet—
a: the eligibility requirements described in subsections (9), (10), and (11)
b: the further eligibility requirements described in sections HL 5C, HL 6, HL 7, HL 9, and HL 10 Eligibility requirements for entity electing to be portfolio listed company
3: An entity that is choosing under section HL 11 subsections (9), (10), and (11) Eligibility requirements for portfolio listed company
4: A portfolio listed company must meet—
a: the eligibility requirements described in subsections (9), (10), and (11)
b: the further eligibility requirements described in sections HL 5C, HL 6, HL 8, HL 9, and HL 10 Eligibility requirements for entity electing to be portfolio defined benefit fund
5: An entity that is choosing under section HL 11 subsections (9), (10), and (11) Eligibility requirements for portfolio defined benefit fund
6: A portfolio defined benefit fund must meet—
a: the eligibility requirements described in subsections (9), (10), and (11)
b: the further eligibility requirements described in sections HL 6, HL 9, and HL 10 Eligibility requirements for separate identifiable fund electing to be portfolio investment-linked life fund
7: An entity that is choosing under section HL 11 subsections (10) and (11) Eligibility requirements for portfolio investment-linked life fund
8: A portfolio investment-linked life fund must meet—
a: the eligibility requirements described in subsections (10) and (11)
b: the further eligibility requirements described in sections HL 6, HL 9, and HL 10 Business requirement
9: The business requirement is that the entity must not carry on a business of life insurance. Residence requirement
10: The residence requirement is that the entity must be—
a: resident in New Zealand; and
b: not treated under a double tax agreement as not being resident in New Zealand. Entity history requirement
11: The entity history requirement is that the entity must not, before the day on which the election to be a portfolio investment entity is to be effective, have ceased to be a portfolio investment entity under section HL 14(1) company double tax agreement group investment fund life insurance portfolio defined benefit fund portfolio investment entity portfolio investment-linked life fund portfolio listed company portfolio tax rate entity resident in New Zealand superannuation fund .
108: Effect of failure to meet eligibility requirements for entities
1: In section HL 4(2)(a) subparagraph (i)
a: a portfolio investor class of the entity fails to meet a requirement under section HL 6 or HL 9 section HL 10 .
2: In section HL 4(2)(b) subparagraph (i)
b: the failure referred to in paragraph (a) .
109: New sections HL 5B and HL 5C inserted
After section HL 5
HL 5B: Meaning of investor and portfolio investor class
Investor
1: An investor entity
a: if the entity is a company and paragraph (d)
b: if the entity is not a company and paragraphs (c) and (d)
i: by reason of the rules of the entity or the terms of the trust under which the entity is established; and
ii: as if the entity were a company and the person were a shareholder in the company:
c: if the entity is a portfolio investment-linked life fund and paragraph (d)
d: for a share, entitlement, or life insurance policy held through a portfolio investor proxy by a person, the portfolio investor proxy. Portfolio investor class
2: A portfolio investor class
a: the portfolio entity investments are the same for all the investors in the group; and
b: each investor's interest in a portfolio entity investment represents a proportion (the investment proportion
c: the investment proportion for each investor and each portfolio entity investment differs from the average value of the investment proportion, for the investors in the group and the portfolio entity investment, by less than 2.5% of that average value except if subsection (3) Exception to requirement of subsection (2)(c)
3: The investment proportion for an investor in a group referred to in subsection (2)
a: the portfolio entity investment is an arrangement under which the entity is assured of receiving, from investments, sufficient proceeds for the entity to repay each investor in the group an amount contributed to the entity; and
b: the excess in difference between the investment proportion for the investor and the average value for the group arises from differences between the portfolio investor rates of members of the group. investor portfolio entity investment portfolio investment entity portfolio investor class portfolio investor interest
HL 5C: Income interest requirement
Application
1: This section applies to a portfolio investment entity that is not a portfolio investment-linked life fund. Requirement
2: The income interest requirement is that all portfolio investor interests in the entity that give rights in relation to proceeds from a portfolio entity investment give the rights in relation to all the proceeds from the investment that are not category B income. category B income portfolio entity investment portfolio investment entity portfolio investment-linked life fund portfolio investor interest .
110: Investor membership requirement
1: Before section HL 6(1) General investor membership requirement
1A: The investor membership requirement for an entity that is not a company listed on a recognised exchange in New Zealand and does not meet the requirements of subsection (3) subsection (1)
2: In section HL 6(1)
a: the heading is replaced by Investor membership requirement for portfolio investor class
b: the words before paragraph (a) The investor membership requirement for a portfolio investor class is that the class must include—
c: in paragraph (j)(iii) entity. entity:
k: Auckland Regional Holdings.
3: In section HL 6(3) paragraph (a) There is no investor membership requirement for a portfolio investor class, of an entity other than a company listed on a recognised exchange in New Zealand, that,—
4: In section HL 6(3)(c) 1956. 1956:
d: is a superannuation fund that—
i: existed before 17 May 2006; and
ii: on or after 17 May 2006, if treated as a unit trust, would have met the requirements of 1 or more of paragraphs (a) and (c) to (e) of the definition of qualifying unit trust
iii: has no investor, other than the fund's manager or trustee, that can control the investment decisions relating to that class.
111: Further eligibility requirements relating to investments
Section HL 7(3)
3: An adjustment reflecting the effect of the investor's portfolio investor rate must be made to—
a: the investor's portfolio investor interest in the portfolio investor class or another portfolio investor class—
i: before the end of the second month after the portfolio calculation period, if the entity has made an election under section HL 21
ii: before the end of the third month after the end of the income year, if the entity has made an election under section HL 22
iii: before the end of the second month after the end of the tax year, if the entity has made an election under section HL 23
b: the amount of each distribution to the investor as a member of the portfolio investor class or another portfolio investor class:
c: the amount of each payment required from the investor as a member of the portfolio investor class towards satisfying the entity's portfolio entity tax liability.
112: Investor interest size requirement
1: In section HL 9(2) paragraph (a) There is no investor interest size requirement for an investor in a portfolio investor class that,—
2: In section HL 9(2)(c) 1956. 1956:
d: is a superannuation fund that—
i: existed before 17 May 2006; and
ii: on or after 17 May 2006, if treated as a unit trust, would have met the requirements of 1 or more paragraphs (a) and (c) to (e) of the definition of qualifying unit trust
iii: has no investor, other than the fund's manager or trustee, that can control the investment decisions relating to that class.
3: In section HL 9(4)(j) subsection (5) subsection (5)
k: Auckland Regional Holdings.
113: Further eligibility requirements relating to investments
1: In section HL 10(1) paragraph (a) The investment type requirement is that 90% or more by value of the entity's assets must be—
2: In section HL 10(2)
a: after paragraph (b)(i)
ib: replacement payments: :
b: paragraph (b)(iii)
iii: income under a lease of land: :
c: in paragraph (b)(iv) referred to in subsection (1)(a) to (d) property
3: In section HL 10(4) paragraph (a) The requirements of subsection (3)(a) and (b)
114: Election to become portfolio investment entity and cancellation of election
1: After section HL 11(2) Exception to when election effective: certain elections relating to portfolio investment-linked life funds
2B: Despite subsection (2)
a: the election is in relation to an electing entity choosing to be a portfolio investment-linked life fund; and
b: the date of receipt is before 1 April 2008; and
c: 1 October 2007 is nominated in the notice.
2: In section HL 11 portfolio investment-linked life fund
115: Unlisted company may choose to become portfolio listed company
Section HL 11B(1)(a)
a: has 100 shareholders; and .
116: Becoming portfolio investment entity
1: In section HL 12(3)(a) subparagraph (i)
a: transferring to another person all shares held by the entity, or for which the entity is a share supplier in a returning share transfer, that— .
2: After section HL 12(4) Refund of dividend withholding payments made before election
5: If a dividend withholding payment account company becomes a portfolio investment entity on a day in an imputation year other than the end of the imputation year, the balance of the company's dividend withholding payment account at the end of the imputation year for the purposes of section NH 4(5)(f)
117: Tax consequences from transition
Section HL 13(1) When subsection (1B) applies
1: Subsection (1B) No penalty or interest arising from transition
1B: The entity is not liable to pay any penalty or interest for which the entity would otherwise be liable for an inaccuracy, arising from the increased liability for provisional tax, in—
a: an estimate of provisional tax made before the entity chooses to become a portfolio investment entity:
b: a payment of provisional tax due before the end of the 2-month period beginning after the entity becomes a portfolio investment entity.
118: Treatment of income from interest if no investor entitled or investor has conditional entitlement
Section HL 16(2)(e)
e: for an entity that exists on 17 May 2006, the vesting period does not exceed the longest vesting period allowed by the entity on 17 May 2006 for an interest created on that date; and
f: for an entity that does not exist on 17 May 2006,—
i: the portfolio investor interest is transferred to the entity by a superannuation scheme that exists on 17 May 2006 and without significant change to the portfolio investor interest; or
ii: the vesting period does not exceed 5 years, if subparagraph (i)
119: Credits received by portfolio tax rate entity or portfolio investor proxy
1: In section HL 20(4) fees expenses
2: Section HL 20(11) Expenses
11: Expenses
a: fees for ongoing management and administration services paid from or charged to the account of the investor as a member of the portfolio investor class:
b: expenditure of the investor transferred under subpart DV
120: Payments of tax by portfolio tax rate entity making no election
1: After section HL 21(2) Income tax liability
2B: The income tax liability of the entity for a tax year is equal to the total portfolio entity tax liability of the entity for the portfolio calculation periods in the tax year.
2: In section HL 21(3)(a) for the tax year income tax
121: Payments of tax by portfolio tax rate entity choosing to make payments when investor leaves
1: After section HL 23(1) Income tax liability
1B: The income tax liability of the entity for a tax year is equal to the total portfolio entity tax liability of the entity for the portfolio calculation periods in the tax year.
2: In section HL 23(2)(a) for the tax year income tax
3: Section HL 23(2)(b)
b: by the day that is—
i: the end of the month beginning from the end of the month in which the portfolio investor exit period ends, if subparagraph (ii)
ii: the 15 January following the end of the portfolio investor exit period, if the portfolio investor exit period ends in November.
122: Optional payments of tax by portfolio tax rate entities
1: In section HL 23B(1) investor's portfolio investor interest in the entity portfolio investor interest for which the investor is a member of a portfolio investor class of the entity
2: Section HL 23B(3) Time of optional payment
3: A payment under this section must be made by—
a: the end of the month beginning from the end of the month in which the portfolio calculation period ends, if paragraph (b)
b: the 15 January following the end of the portfolio calculation period, if the portfolio calculation period ends in November.
123: Portfolio investor allocated income and portfolio investor allocated loss
1: In section HL 24(5) fees expenses
2: Section HL 24(6)(e)
e: expenses
i: fees for ongoing management and administration services paid from or charged to the account of the investor as a member of the portfolio investor class:
ii: expenditure of the investor transferred under subpart DV .
124: Treatment of portfolio investor allocated loss for zero-rated portfolio investors and investors with portfolio investor exit period
1: In section HL 25(2) income year corresponding to the tax year income year including the end of the portfolio tax rate entity's income year
2: In the list of defined terms in section HL 25
a: portfolio allocation period portfolio investor allocated income
b: income tax portfolio tax rate entity
125: Credits received by portfolio tax rate entity or portfolio investor proxy
1: Section HL 27(6) Application of subsections (7) to (11)
6: For an investor in a portfolio tax rate entity who is allocated under subsection (3)
a: subsections (7) and (8)
i: the investor is a zero-rated portfolio investor:
ii: the investor is not a zero-rated portfolio investor and the entity makes payments of tax under section HL 21
b: subsections (10) and (11) paragraph (a)
2: Section HL 27(7) Zero-rated portfolio investors and certain investors having portfolio investor exit period: credit
7: The investor is treated as receiving for the allocated credits, for the tax year corresponding to the investor's income year,—
a: a credit against income tax payable by the investor of the amount given by subsection (8)
i: the credits are under subpart LC
ii: the investor is not a portfolio tax rate entity or portfolio investor proxy; or
b: the allocated amount of each type of credit if—
i: the credits are not under subpart LC
ii: the investor is a portfolio tax rate entity or portfolio investor proxy.
3: In section HL 27(8) portfolio investment entities portfolio tax rate entities, portfolio investor proxies
4: Section HL 27(9)
5: In section HL 27(10B)(a)(ii) section HL 22 or HL 23 section HL 23
6: Section HL 27(10B)(b)
b: the investor as a member of—
i: the portfolio investor class:
ii: another portfolio investor class, if the entity chooses such a use for the credit.
7: In section HL 27(11)(a)(ii)
a: in subsection (10B)(b) in subsection (10C)(b)
b: by subsection (10B) by subsection (10C)
126: Portfolio investor proxies
In section HL 31(3)(d) or the payments required from the investor, distributions to the investor,
127: Companies included in group of companies
After section IG 1(2)
2B: For the purposes of this Act, in relation to any 2 or more companies of which 1 is a portfolio tax rate entity, the companies are treated as being a group of companies for an income year or other period if—
a: a portfolio tax rate entity owns 100% of the voting interests in the other companies; and
b: each company that is not a portfolio tax rate entity is a portfolio land company.
128: Net loss offset between group companies
1: In section IG 2(9) Section IE 1(4) Sections CG 2 and DB 38
2: Subsection (1)
129: Rebate in respect of gifts of money
1: Section KC 5(1)(be)
be: Childfund New Zealand Limited: .
2: In section KC 5(1)(cu) Trust. Trust:
cv: Hamlin Charitable Fistula Hospitals Trust:
cw: Hope Foundation Development Trust:
cx: Hope International Charitable Trust:
cy: Limbs 4 All Charitable Trust:
cz: New Zealand Disaster Assistance Response Team Trust:
da: Operation Restore Hope Charitable Trust:
db: The World Swim for Malaria Foundation (New Zealand).
3: Subsection (2)
130: New section KC 6 inserted
1: After section KC 5
KC 6: Rebate in respect of redundancy payment
1: A person who derives a redundancy payment relating to a loss of employment is allowed as a rebate of income tax relating to the loss of employment the smaller of—
a: $3,600:
b: a sum equal to 6 cents for every complete dollar of the total amount derived by the person of redundancy payments, each of which—
i: relates to the loss of employment; and
ii: is not a payment referred to in subsection (3)
2: The Commissioner must not make a refund under this section before the person makes an application complying with section 41B of the Tax Administration Act 1994
3: A rebate is not allowed for a redundancy payment—
a: relating to retirement from employment:
b: relating to loss of seasonal employment if the loss arises from the normal seasonal work cycle:
c: relating to a contract of employment for a fixed term or for the duration of a project:
d: relating to employment for a period following notice of termination of employment:
e: paid to a director of a company by the company or by a person associated with the company under section OD 8(3)
f: paid to a person by another person associated with the person under section OD 8(3)
g: paid by a person to an employee who has been paid a redundancy payment by another person associated with the person under section OD 8(3)
2: Subsection (1)
131: Amendments to subpart KD made in schedule 1
1: The amendments to subpart KD schedule 1
2: Subsection (1)
132: Determination of net income
1: In section KD 1(1)(e)(viii) and (c) section CX 44D(1)(b)
2: After section KD 1(1)(e)(viii)
ix: any amount of retirement scheme contribution that is not excluded income of the person and would be excluded income of the person in the absence of section CX 42B(2) .
3: After section KD 1(1)(h)
hb: where the person receives a distribution from a retirement savings scheme of a retirement scheme contribution, the distribution is treated as assessable income derived by the person in the income year of the distribution if retirement scheme contribution withholding tax has been deducted from the contribution and, at the time of the distribution, the person is—
i: not eligible to receive New Zealand superannuation; and
ii: eligible to receive a retirement scheme contribution from a retirement scheme contributor; and .
133: Calculation of subpart KD credit
1: In section KD 2(6) paragraph (b) of the definition of full year abatement spouse spouse, civil union partner, or de facto partner
2: Subsection (1)
134: Determination of amount of credit in certain cases
In section LB 1(1)
a: in paragraph (c) so calculated so calculated ( section MZ 15
b: in paragraph (d) so calculated so calculated ( section MZ 15
c: in paragraph (e) subsection (5) subsection (5) section MZ 15
135: Credit of tax for imputation credit
1: In section LB 2(2) income year income year ( section MZ 16
2: After section LB 2(7)
8: An amount is treated as if it were assessable income for the purpose of determining a taxpayer's entitlement to a credit under this section if the amount would but for section EX 47
136: New section LB 3 inserted
After section LB 2
LB 3: Credit of retirement scheme contribution withholding tax for imputation credit
1: If a retirement scheme contributor attaches an imputation credit to a retirement scheme contribution for a person in an income year, the retirement scheme contributor is entitled to a credit of retirement scheme contribution withholding tax equal to the lesser of the following amounts:
a: the amount of the imputation credit:
b: the liability of the retirement scheme contributor for retirement scheme contribution withholding tax on the retirement scheme contribution.
2: If the amount of the imputation credit exceeds the liability of the retirement scheme contributor for retirement scheme contribution withholding tax on the retirement scheme contribution,—
a: the amount of the excess is treated as an imputation credit attached to a distribution from the retirement scheme contributor to the person; and
b: the person responsible for withholding the retirement scheme contribution withholding tax must, within 30 days of the contribution, give a notice to the person showing the amount of the excess credit.
137: New sections LD 1B and LD 1C inserted
After section LD 1
LD 1B: Tax deductions from certain accident compensation payments: credit allowed to provider
1: This section applies if—
a: a claimant under the Injury Prevention, Rehabilitation, and Compensation Act 2001
i: is paid a personal service rehabilitation payment for the claimant for a period, for a key aspect of social rehabilitation referred to in the definition of personal service rehabilitation payment key aspect of social rehabilitation
ii: pays another person for providing a key aspect of social rehabilitation to the claimant for a period; or
b: the Accident Compensation Corporation pays another person a personal service rehabilitation payment for the claimant for a period, for providing a key aspect of social rehabilitation to the claimant for the period.
2: The person (the provider
3: The amount of the credit allowed under subsection (2)
4: In the formula,—
a: amount received
b: tax rate
LD 1C: Tax deductions from certain accident compensation payments: credit allowed to claimant
1: This section applies if—
a: a claimant under the Injury Prevention, Rehabilitation, and Compensation Act 2001 personal service rehabilitation payment key aspect of social rehabilitation
b: the claimant pays another person (the provider
c: the amount paid to the provider is less than the amount of personal service rehabilitation payment for the claimant for the period, after any deduction of tax under this Act.
2: The tax credits under section LD 1(2)
3: In the formula,—
a: total tax deductions
b: amount paid subsections (1)(b) and (c)
c: tax rate
138: New section LD 4 inserted
After section LD 3A
LD 4: Credit of retirement scheme contribution withholding tax for Maori authority credit
1: If a retirement scheme contributor attaches a Maori authority credit to a retirement scheme contribution for a person in an income year, the retirement scheme contributor is entitled to a credit of retirement scheme contribution withholding tax equal to the lesser of the following amounts:
a: the amount of the Maori authority credit:
b: the liability of the retirement scheme contributor for retirement scheme contribution withholding tax on the retirement scheme contribution.
2: If the amount of the Maori authority credit exceeds the liability of the retirement scheme contributor for retirement scheme contribution withholding tax on the retirement scheme contribution,—
a: the amount of the excess is treated as a Maori authority credit attached to a taxable Maori authority distribution from the retirement scheme contributor to the person; and
b: the person responsible for withholding the retirement scheme contribution withholding tax must within 30 days of the contribution give a notice to the person showing the amount of the excess credit.
139: Credit of tax for dividend withholding payment credit in hands of shareholder
In section LD 8(1)(a) in assessable income in assessable income ( section MZ 16
140: New section LD 12 added
After section LD 11
LD 12: Credit for retirement scheme contribution withholding tax if retirement scheme contribution not excluded income
1: This section applies for a taxpayer and a tax year if the taxpayer—
a: derives income as a retirement scheme contribution for a period in the corresponding income year; and
b: the retirement scheme contributor pays an amount of retirement scheme contribution withholding tax under subpart NEB
c: the income is not excluded income of the taxpayer under section CX 42B
2: If the taxpayer is a New Zealand resident, the taxpayer is entitled to a credit of tax against the taxpayer's income tax liability for the tax year equal to the amount paid as retirement scheme contribution withholding tax.
3: If the taxpayer is a non-resident and subsection (4) section NG 16
4: If the taxpayer is a non-resident and the retirement scheme contribution is a taxable Maori authority distribution, the taxpayer is entitled to a credit of tax against the taxpayer's income tax liability for the tax year equal to the amount paid as retirement scheme contribution withholding tax in relation to the retirement scheme contribution.
5: For the purposes of section BC 10(2)(a) and (b)
a: first, use the tax credit to satisfy the taxpayer's income tax liability for a tax year before the tax year:
b: second, use the tax credit to satisfy the taxpayer's income tax liability for a tax year after the tax year, applying this paragraph to tax years in numerical order:
c: third, use the tax credit to pay the taxpayer's provisional tax for a tax year after the tax year, applying this paragraph to tax years in numerical order:
d: fourth, use the tax credit to pay an amount that is payable by the taxpayer under an Inland Revenue Act:
e: fifth, treat the tax credit as tax paid in excess and refundable or transferable to the extent that section MD 1 and Part 10B of the Tax Administration Act 1994
141: Credits in respect of dividends to non-resident investors
The following is added to section LE 2
13: Section MZ 17 subsections (2), (9) and (10)
142: Special rules for holding companies
In section LE 3(6), in item T income year income year ( section MZ 17
143: Estimation method
1: Section MB 6(5)
5: If, under section MB 17(5)
a: C and F for changes to a 6-monthly GST taxable period:
b: B, D, and F for other changes.
2: Subsection (1)
144: GST ratio method
1: After section MB 7(3) When subsection (3C) applies instead of subsection (3)
3B: Subsection (3C) subsection (3)
a: for the year before the preceding year referred to in subsection (3)
i: an assessment of a base amount has not been made and the absence of assessment is due to an extension of time to file the return for that year or a period in that year:
ii: an assessment of a base amount is the subject of a dispute or challenge under the Tax Administration Act 1994
iii: the year is a transitional year; and
b: for the year that is 2 years before the preceding year referred to in subsection (3)
i: the base amounts have been assessed; and
ii: no assessment of a base amount is the subject of a dispute or challenge under the Tax Administration Act 1994
iii: the year is not a transitional year. Amounts based on tax year 2 years before preceding tax year
3C: The GST ratio under this subsection is the percentage based on the assessments of the base amounts for the year that is 2 years before the preceding year referred to in subsection (3)
2: After section MB 7(7) When subsection (7C) applies instead of subsection (7)
7B: Subsection (7C) subsection (7)
a: for the year before the transitional year referred to in subsection (7)
i: an assessment of a base amount has not been made and the absence of assessment is due to an extension of time to file the return for that year or a period in that year:
ii: an assessment of a base amount is the subject of a dispute or challenge under the Tax Administration Act 1994
iii: the year is a transitional year; and
b: for the year that is 2 years before the transitional year referred to in subsection (7)
i: the base amounts have been assessed; and
ii: no assessment of a base amount is the subject of a dispute or challenge under the Tax Administration Act 1994
iii: the year is not a transitional year. GST ratio based on tax year 2 years before transitional tax year
7C: The GST ratio under this subsection is the percentage based on the assessments of the base amounts for the year that is 2 years before the transitional year referred to in subsection (7)
3: Subsections (1) (2)
145: Provisional tax payable in instalments
1: In section MB 8(6) section MB 6 or MB 9 section MB 9
2: In section MB 8(8) paragraph (a)
8: A new provisional taxpayer who starts a taxable activity in a tax year is liable to pay interest calculated under section 120KC of the Tax Administration Act 1994 .
3: Section MB 8(8)(b)(ii)
ii: if they pay GST on a 6-monthly basis and start a taxable activity at some time in the period that starts at the beginning of the corresponding income year and ends 30 days before the date of instalment C: .
4: Subsections (1) (2) (3)
146: Calculating amount of instalment under standard and estimation methods
1: In section MB 9(1)(b) MB 8(2) and (4) MB 8(2), (4), (6), and (7)
2: Subsection (1)
147: Who may use GST ratio?
1: In section MB 15(2)
a: in the words before the paragraphs, preceding tax year preceding tax year and corresponding income year
b: in paragraph (b) whole tax year whole income year
2: In section MB 15(8)(a) in writing in writing or by telephone
3: In section MB 15(11) the tax year immediately before a tax year earlier than
4: Subsections (1) (2) (3)
148: Changing determination method
1: In section MB 17(2) Subsection (3) or (4) Subsection (4) or (5)
2: In section MB 17(4) (5), as if the election to use the GST ratio had not been made (5). They are treated as never electing to use the GST ratio method and, for the purposes of section 120KE(5) of the Tax Administration Act 1994
3: Subsections (1) (2)
149: Disposal of assets
1: In section MB 18(2)
a: the words income year. The adjustment must be made to both income year by subtracting the value, including GST, of the relevant asset from
b: paragraphs (a) and (b)
a: the total taxable supplies for a taxable period for the purposes of the formula in section MB 10(1) section 20(4) of that Act
b: the base amount of total taxable supplies for the corresponding income year under section MB 7(2) section 20(4) of that Act
2: Subsection (1)
150: Paying provisional tax in transitional years
1: In section MB 20
a: subsection (2)(a) and (b)
a: the 28th day of the months given by schedule 13, part B paragraphs (b) and (c)
b: the 15th day of January, when the month given by schedule 13, part B
c: the 7th day of May, when the month given by schedule 13, part B :
b: in subsection (3)(b) month. month; or
c: the 7th day of May, when March is the final month and the year is a transitional year.
2: Subsection (1)
151: Consequences of change in balance date
1: Section MB 24(5) Adjustment to liability
5: The taxpayer must—
a: adjust their provisional tax liability for the part period of 1 month before the start of the new income year; and
b: pay the instalment of provisional tax for the part period, as their final taxable period, by—
i: the day that is 28 days after the end of the part period, if subparagraphs (ii) and (iii)
ii: 15 January, if the part period is November; or
iii: 7 May, if the part period is March.
2: Subsection (1)
152: Registering for GST or cancelling registration
1: Section MB 25(5) Date of cancellation
5: For the purposes of subsection (4)
a: the date on which the cancellation of GST registration is notified:
b: the date on which the taxpayer ceases under section 52 of the Goods and Services Act 1985
2: Subsection (1)
153: Refund of excess tax
1: In section MD 1(4)(a) family support and family plus tax credits for families
2: Subsection (1)
154: Companies required to maintain imputation credit account
In section ME 1(2)(i) section 24 section 266
155: Companies electing to maintain imputation credit account
1: Section ME 1A(1)
1: A company that is not required under section ME 1
a: resident in Australia; and
b: not a company referred to in section ME 1(2)(c) to (k)
c: not treated as being resident in a country other than Australia under and for the purposes of an agreement that—
i: is between Australia and the other country; and
ii: would be a double tax agreement if negotiated between New Zealand and the other country.
2: Subsection (1)
156: Credits arising to imputation credit account
1: After section ME 4(1)(ad)
ae: the amount of any qualifying company election tax paid by the company for the imputation year: .
2: After section ME 4(2)(ad)
ae: in the case of a credit referred to in subsection (1)(ae) .
157: Allocation rules for imputation credits
1: In section ME 8(1) that is concurrent with the imputation year
2: After section ME 8(6)
7: Sections MZ 13 and MZ 14
158: Further tax payable where end of year debit balance or when company ceases to be imputation credit account company
Section ME 9(4)
4: A company must pay any further income tax to which it is liable under subsection (3)
a: not later than the last day on which the company is still an imputation credit account company, if paragraph (b)
b: by the end of the imputation year in which the company ceases to be an imputation credit account company, if the company ceases to be an imputation credit account company because it becomes a portfolio investment entity.
159: Amount of imputation credit to be attached to cash distribution
The following is added to section ME 31
3: Section MZ 20 subsection (1)
160: Notional distribution deemed to be dividend
The following is added to section ME 33
4: Section MZ 20 subsection (1)
161: Amount of imputation credit to be attached to cash distribution
The following is added to section ME 36
3: Section MZ 20 subsection (1)
162: Notional distribution deemed to be dividend or taxable Maori authority distribution
The following is added to section ME 38
3: Section MZ 20 subsection (1)
163: Branch equivalent tax account of company
The following is added to section MF 3
3: Section MZ 21
164: Credits and debits arising to branch equivalent tax account of company
The following is added to section MF 4
7: Section MZ 21
165: Use of credit to reduce dividend withholding payment, or use of debit to satisfy income tax liability
1: After section MF 5(5)
5B: An election made for a company (the first company section MF 5(4) section MF 10(4) section MF 4(1)(a) e
5C: An amount of election that is invalid under subsection (5B)
a: is not recorded as a credit in the branch equivalent tax account of the company that makes the election:
b: is not an amount of debit balance for which the election is made:
c: does not relate to the election.
2: Subsection (1) subsection (1)
3: If subsection (1) subsection (2) subsection (1)
166: Debits and credits arising to group branch equivalent tax account
The following is added to section MF 8
7: Section MZ 21
167: Use of consolidated group credit to reduce dividend withholding payment, or use of group or individual debit to satisfy income tax liability
1: After section MF 10(4)
4B: An election made for a consolidated group under section MF 10(3) section MF 10(3)(a) to (c) section MF 8(2)(a) e
4C: An election made for a company (the first company section MF 10(4) section MF 5(4) section MF 4(1)(a) e
4D: An amount of election that is invalid under subsections (4B) or (4C)
a: is not recorded as a credit in the branch equivalent tax account of the company or consolidated group, as the case may be, that makes the election:
b: is not an amount of debit balance for which the election is made:
c: does not relate to the election.
2: Subsection (1) subsection (1)
3: If subsection (1) subsection (2) subsection (1)
168: Allocation rules for dividend withholding payment credits
1: In section MG 8(1), item a that is concurrent with the imputation year
2: After section MG 8(8)
9: Sections MZ 13 and MZ 14
169: Dividend with both imputation credit and dividend withholding payment credit attached
1: In section MG 10(1), item a that is concurrent with the imputation year
2: After section MG 10(2)
3: Section MZ 13
170: Conduit tax relief account
The following is added to section MI 3
3: Section MZ 22
171: Credits arising to conduit tax relief account
The following is added to section MI 4
3: Section MZ 22
172: Debits arising to conduit tax relief account
The following is added to section MI 5
8: Section MZ 22
173: Consolidated group conduit tax relief account
The following is added to section MI 15
2: Section MZ 22
174: Credits arising to group conduit tax relief account
The following is added to section MI 17
3: Section MZ 22
175: Debits arising to group conduit tax relief account
The following is added to section MI 18
5: Section MZ 22
176: Private use of motor vehicle: when schedular value not used
1: In section ND 1U(1) clause 6 clause 5
2: In section ND 1U(2) paragraph (a) clause 2 clause 4
3: In section ND 1U(3) clause 2 clause 4
4: Subsections (1) to (3)
177: Private use of motor vehicle: when schedular value used
1: In section ND 1V(1) clause 6 clause 5
2: Subsection (1)
178: New subpart NEB inserted
After subpart NEA
NEB: Retirement scheme contribution withholding tax
NEB 1: Retirement scheme contribution withholding tax imposed
Retirement scheme contribution subject to withholding tax
1: A retirement scheme contribution made for a person to a retirement savings scheme is subject to retirement scheme contribution withholding tax at the retirement scheme withholding rate for the person. Amount of retirement scheme contribution
2: For the purposes of the RSCWT rules, unless the context otherwise requires, the amount of a retirement scheme contribution is the total of—
a: the amount received as the retirement scheme contribution by the retirement savings scheme and not deducted under section NEB 2
b: the amount of retirement scheme contribution withholding tax payable under the RSCWT rules on the retirement scheme contribution. retirement savings scheme retirement scheme contribution retirement scheme contribution withholding tax retirement scheme withholding rate RSCWT rules
NEB 2: Retirement scheme contribution withholding tax to be deducted
Responsibility of retirement scheme contributor to deduct
1: A retirement scheme contributor who pays to a retirement savings scheme an amount that represents a retirement scheme contribution for a person must, at the time of the payment, deduct from the amount an amount of retirement scheme contribution withholding tax determined under section NEB 1 Appointment of retirement savings scheme as agent
2: A retirement scheme contributor who pays a retirement scheme contribution to a retirement savings scheme may appoint the retirement savings scheme as agent to make the deduction required by subsection (1) retirement savings scheme retirement scheme contribution retirement scheme contribution withholding tax retirement scheme contributor
NEB 3: Payment and notice of deductions
Payment and notice
1: A retirement scheme contributor or retirement savings scheme who deducts retirement scheme contribution withholding tax from a retirement scheme contribution must, not later than the 20th of the month following the month in which the deduction is made,—
a: pay the amount of the deduction to the Commissioner; and
b: give to the Commissioner, in a notice in a form acceptable to the Commissioner, a figure for the amount of retirement scheme contribution withholding tax being paid for the month of the deduction other than by the use of imputation credits and Maori authority credits. Amalgamating company
2: If an amalgamating company ceases to exist on an amalgamation, subsection (1) Commissioner imputation credit Maori authority credit notice retirement savings scheme retirement scheme contribution retirement scheme contribution withholding tax retirement scheme contributor tax file number
NEB 4: Failure to deduct
Debt owing to Commissioner
1: If a retirement scheme contributor or retirement savings scheme fails to deduct retirement scheme contribution withholding tax from a retirement scheme contribution for a person as required by section NEB 1 subsection (2)
a: payable to the Commissioner by the retirement scheme contributor; and
b: becoming due and payable on the 20th of the month following the month in which the retirement scheme contribution was made. Formula for amount of debt
2: The amount of the debt is calculated using the formula— Definition of items in formula
3: The items in the formula are defined in subsections (4) to (6) Tax rate
4: Tax rate Contribution to scheme
5: Contribution to scheme Tax already paid
6: Tax already paid Commissioner retirement savings scheme retirement scheme contribution retirement scheme contribution withholding tax retirement scheme contributor retirement scheme withholding rate
NEB 5: Retirement savings schemes
Eligibility to be retirement savings scheme
1: An entity is eligible to be a retirement savings scheme for a person if—
a: the entity is a portfolio investment entity; and
b: under the rules (the distribution rules) governing the distribution by the entity of funds in which the person has an interest, the availability of distributions to the person is restricted before the person reaches an age of retirement specified in the rules; and
c: under the distribution rules, the person is not permitted to make a withdrawal before the age of retirement other than a withdrawal—
i: for the repayment of a student loan as defined in the Students Loan Scheme Act 1992
ii: for the payment of fees and expenses relating to tertiary education:
iii: for the purchase of housing, if the person does not own a home:
iv: that the person would be permitted to make if the scheme were a KiwiSaver scheme under the KiwiSaver Act 2006
v: in circumstances specified in the rules as approved under paragraph (e)
d: under the distribution rules, the entity may require the person to provide information for the purpose of ensuring that the requirements relating to a withdrawal are met; and
e: the Commissioner approves the distribution rules as being fair and reasonable. Retirement savings scheme for person
2: An entity is a retirement savings scheme for a person for an income year if, in the income year,—
a: the entity is eligible to be a retirement savings scheme for the person under subsection (1)
b: the entity holds funds from a retirement scheme contribution for the person. Commissioner income year portfolio investment entity retirement savings scheme retirement scheme contribution retirement-scheme contributor
NEB 6: Retirement scheme contributors
Eligibility to be retirement scheme contributor
1: An entity is eligible to be a retirement scheme contributor for a person if—
a: the entity is—
i: the trustee of a widely-held trust that is a unit trust:
ii: a company other than a close company:
iii: a Maori authority; and
b: the person is a unit holder, shareholder, or member, of the entity. Retirement scheme contributor for person
2: An entity is a retirement scheme contributor for a person for an income year if,—
a: in the income year, the entity is eligible to be a retirement scheme contributor under subsection (1)
b: in or before the income year, the entity makes a payment intended to be a retirement scheme contribution for the person. close company company income year Maori authority retirement savings scheme retirement scheme contribution retirement scheme contributor shareholder trustee unit holder unit trust widely-held trust
NEB 7: Application of other provisions to retirement scheme contribution withholding tax
Section GC 20 and sections 170(2), 171, and 172 of the Tax Administration Act 1994
1: For the purposes of the RSCWT rules, section GC 20 sections 170(2), 171, and 172 of the Tax Administration Act 1994
a: a reference to a resident withholding tax deduction were a reference to a deduction of retirement scheme contribution withholding tax:
b: a reference to the RWT rules were a reference to the RSCWT rules. Other provisions, except for RSCWT rules
2: The provisions of this Act and of the Tax Administration Act 1994 subsection (1) section BB 1 Relationship with other RSCWT rules
3: Subsections (1) and (2) income tax resident withholding tax deduction retirement scheme contribution withholding tax RSCWT rules RWT rules
179: Application of RWT rules
1: After section NF 1(2)(b)(x)
xi: dividends that are excluded income by virtue of the application of section CX 42B section CX 42B(2)(a) and (b) .
2: After section NF 1(2)(b)(xi)
xii: dividends that are not non-cash dividends and that—
A: have an imputation ratio, dividend withholding payment ratio, or combined imputation and dividend ratio, of 30/70 or greater; and
B: are paid by a unit trust or a group investment fund, and the unit trust, the group investment fund, or an RWT proxy for them, has not deducted resident withholding tax from any previous dividend.
3: Section NF 1(2)(c)
c: taxable Maori authority distributions not being retirement scheme contributions: .
180: Resident withholding tax deductions from dividends deemed to be dividend withholding payment credits
1: In section NF 8(1) LB 1 LB 1, excluding subsection (1)(d) and (e)
2: Subsection (1)
a: for the 2008–09 and later income years, unless paragraph (b)
b: on and after 1 April 2008 for a portfolio tax rate entity that does not choose to be subject to section HL 22
181: New section NG 16B inserted
After section NG 16A
NG 16B: Person withholding amount as retirement scheme contribution withholding tax when liable for non-resident withholding tax
1: This section applies for a retirement scheme contributor who—
a: makes a retirement scheme contribution for a non-resident; and
b: pays to the Commissioner an amount as retirement scheme contribution withholding tax relating to the retirement scheme contribution.
2: The retirement scheme contributor is treated as having withheld from the retirement scheme contribution and paid to the Commissioner an amount of non-resident withholding tax equal to the lesser of—
i: the amount paid as retirement scheme contribution withholding tax in relation to the retirement scheme contribution:
ii: the non-resident withholding tax payable in relation to the retirement scheme contribution.
3: Section LD 12
182: Definitions
1: This section amends section OB 1
2: In the definition of allowable rebates paragraph (a)
a: means the total of the rebates and credits of tax that a person is allowed in a tax year under Part K (Rebates), excluding rebates or credits allowed under—
i: section KC 4
ii: section KC 5
iii: subpart KI
iv: subpart KJ .
3: In the definition of applicable basic tax rate paragraph (b) (Basic rates of income tax and specified superannuation contribution withholding tax)
4: After the definition of attributing interest attribution company section GC 14EB(1) .
5: In the definition of child paragraph (b) Tax credits for family support and family plus Tax credits for families
6: In the definition of child paragraph (b)(iii) family tax credit minimum family tax credit
7: In the definition of civil union partner Tax credits for family support and family plus Tax credits for families
8: In the definition of elected period Tax credits for family support and family plus Tax credits for families
9: In the definition of eligible period paragraph (f) ring-fenced family support recipient ring-fenced family tax credit recipient
10: In the definition of employment paragraph (d) Tax credits for family support and family plus Tax credits for families
11: In the definition of employment paragraph (e) family tax credit minimum family tax credit
12: After the definition of environmental restoration account equity instrument section EW 15B .
13: After the definition of fair dividend rate method fair value method .
14: The definition of family plus
15: In the definition of family support credit family support credit family tax credit
16: The definition of family tax credit
17: In paragraph (b) of the definition of finance lease life) life):
c: the person enters on or after 20 June 2007 and is, or is part of, an arrangement that, when the person enters the lease or when a change in the terms of the arrangement changes the allocation or size of the risks and rewards incidental to ownership of the lease asset,—
i: involves use of the asset outside New Zealand for all or most of the term of the lease; and
ii: involves income of any person who is not the lessor, arising from the use of the asset by any person, that is exempt income, or excluded income, or non-residents' foreign-sourced income; and
iii: is a finance lease under NZIAS 17 for the lessor, or for a company that is in the same group of companies as the lessor and derives assessable income from the arrangement, or is an arrangement under which persons who do not include the lessor bear substantially all the risks and rewards incidental to ownership of the lease asset, determined as at the time the person enters the lease and taking into account later changes to the arrangement .
18: The definition of Financial Reporting Standard No 13 1995 (Accounting for Research and Development Activities)
19: In the definition of financial statements livestock)), livestock)), subpart EW
20: After the definition of gift gifting settlor section EX 40(10) .
21: In the definition of group of companies section IG 1(2) section IG 1(2) and (2B)
22: After the definition of identical share IFRS IFRS taxpayer method sections EW 15B to EW 15E impaired credit adjustment section EW 15C(4) .
23: In the definition of investor paragraphs (b) and (c)
b: for a portfolio investment entity is defined in section HL 5B .
24: The definition of in-work payment in-work tax credit subpart KD section KD 2AAA .
25: In the definition of land paragraph (a)(i)
26: In paragraph (d) of the definition of lease FC 8I FC 8H
27: After the definition of minibus minimum family tax credit section KD 3 .
28: After the definition of nil period Niue International Trust Fund .
29: After the definition of non-filing taxpayer non-integral fee .
30: After the definition of NRWT rules NZIAS 2 NZIAS 8 NZIAS 17 NZIAS 32 NZIAS 39 NZIAS 41 section EB 6(3) .
31: After the definition of offshore permit area old company tax rate .
32: After the definition of personal property lease payment personal service rehabilitation payment
a: under section 81(3) of the Injury Prevention, Rehabilitation, and Compensation Act 2001
b: by the Accident Compensation Corporation or an employer that is an accredited employer as defined in section 181 of that Act
c: in providing to the person a key aspect of social rehabilitation referred to in—
i: section 81(1)(b), (c), (e), or (g)
ii: section 81(1)(h) paragraph (a)(i) of the definition of transport for independence .
33: The definition of petroleum mining operations petroleum mining operations section CT 6B .
34: In the definition of portfolio entity investment a portfolio investment entity an entity
35: In the definition of portfolio investment entity paragraph (c) fund fund:
d: portfolio investment-linked life fund .
36: After the definition of portfolio investment entity portfolio investment-linked life fund
a: holds investments subject to life insurance policies under which benefits are directly linked to the value of the investments held in the fund; and
b: has become a portfolio investment entity under section HL 12
c: has not ceased to be a portfolio investment entity under section HL 14 .
37: The definition of portfolio investor class portfolio investor class section HL 5B .
38: In the definition of portfolio investor exit period paragraph (b)(ii)
ii: ending on a day in the tax year on which the amount of the entity's portfolio tax liability under section HL 20 .
39: The definition of portfolio investor rate portfolio investor rate
a: 33%, if paragraphs (b) and (c)
b: the rate, if paragraph (c)
i: to the entity as the prescribed investor rate for the investor and the period; and
ii: in the latest notice before the time; or
c: 0%, if—
i: the entity makes payments of tax under section HL 21
ii: the portfolio investor rate at the time for the investor for the portfolio calculation period would, in the absence of this paragraph, be more than 0%; and
iii: the portfolio calculation period includes part of a portfolio investor exit period for the investor .
40: In the definition of portfolio land company paragraph (b)
a: in the words before subparagraph (i) 80% 80% or more
b: in subparagraph (ii) of the company of the company; and
c: meets the requirements of section HL 10(2) .
41: In the definition of portfolio listed company paragraph (d) entity) entity); and
e: is not a portfolio investment-linked life fund .
42: In the definition of portfolio tax rate entity paragraph (d) fund fund; and
e: is not a portfolio investment-linked life fund .
43: In the definition of qualifying person paragraphs (a)(iii) and (c) family tax credit minimum family tax credit
44: After the definition of reduced deficit debit redundancy payment
a: to a person whose employment in a position is terminated because the position is superfluous to the requirements of the person's employer; and
b: in compensation for the person's loss of employment .
45: In the definition of refundable credit paragraph (d) election) election); or
e: for a tax credit under section LD 12 .
46: In the definition of refundable rebate Tax credits for family support and family plus Tax credits for families
47: In the definition of resident Tax credits for family support and family plus Tax credits for families
48: In the definition of residual income tax
a: in the words before paragraph (a) Tax credits for family support and family plus Tax credits for families
b: after paragraph (j)
jb: the amount of any tax credit under section LD 12 .
49: After the definition of retained earnings retirement savings scheme section NEB 5 retirement scheme contribution
a: as an amount of—
i: money:
ii: imputation credits:
iii: Maori authority credits; and
b: to an entity that is eligible to be a retirement savings scheme; and
c: by an entity that is eligible to be a retirement scheme contributor; and
d: for the benefit of the person; and
e: because the person is a member of, or has an ownership interest in, the entity that is eligible to be a retirement scheme contributor retirement scheme contribution withholding tax retirement scheme contributor section NEB 6 retirement scheme prescribed rate contribution year
a: 39%, if none of paragraphs (b) to (d)
b: 33%, if paragraphs (c) and (d)
c: 19.5%, if paragraph (d)
i: the person has, in either of the 2 income years immediately before the contribution year, taxable income of $38,000 or less:
ii: the person is a non-resident and the retirement scheme contributor is a Maori authority and the distribution is $200 or less:
iii: the person is a non-resident and the retirement scheme contributor is a Maori authority and the person supplies the Maori authority with a notice satisfying section 28C of the Tax Administration Act 1994
d: 0%, if the person is a non-resident at the time and the contribution is non-resident withholding income retirement scheme withholding rate
a: 39%, if paragraphs (b) and (c)
b: 19.5%, if paragraph (c)
c: the rate that the person notifies to the retirement scheme contributor as the retirement scheme prescribed rate for the person and the retirement scheme contribution—
i: before the retirement scheme contribution is made; and
ii: by a notice satisfying section 28C of the Tax Administration Act 1994 .
50: After the definition of royalty RSCWT rules
a: the following provisions:
i: section CX 42B
ii: section LB 3
iii: section LD 4
iv: section LD 12
v: subpart NEB
vi: section NF 1(2)(b)(xi) and (c)
vii: section NG 16B
b: section 48B and Part 9 of the Tax Administration Act 1994 .
51: In the definition of separated person paragraph (b) Tax credits for family support and family plus Tax credits for families
52: After the definition of social assistance suspensory loan sound commercial reason section EW 26(7) .
53: In the definition of specified period paragraph (a) Tax credits for family support and family plus Tax credits for families
54: In the definition of spouse Tax credits for family support and family plus Tax credits for families
55: After the definition of time of the sale Tokelau International Trust Fund .
56: In the definition of venture investment agreement for the purposes of that section
57: Subsection (25)
58: Subsections (12) (13) (18) (19) (22) (29) (30) (52)
a: the 2007–08 and later income years, unless paragraph (b)
b: the first income year for which a person adopts IFRS s for the purposes of financial reporting and later income years, if that first income year is before the 2007–08 income year.
59: Subsection (17)
60: Subsections (5) (6) (7) (8) (9) (10) (11) (14) (15) (16) (24) (27) (43) (46) (47) (48)(a) (51) (53) (54)
183: Meaning of source deduction payment: shareholder-employees of close companies
1: The heading to section OB 2 Meaning of source deduction payment
2: In section OB 2(1) GC 14D GC 14D, or a personal services rehabilitation payment for a claimant under the Injury Prevention, Rehabilitation, and Compensation Act 2001
184: Meaning of income tax
1: In section OB 6(1)(d)(i) retirement scheme contribution withholding tax, specified superannuation contribution withholding tax,
2: In section OB 6(3)(o) , 141B, sections 31
185: Further definitions of associated persons
1: In section OD 8(1) DT 2,
2: In section OD 8(3) paragraph (a) KC 6, HL 9,
186: Schedule 13—Months for payment of provisional tax and terminal tax
1: In schedule 13, part B 7– 7–8
2: Subsection (1)
2: Amendments to Tax Administration Act 1994
187: Tax Administration Act 1994
Sections 188 to 268 Tax Administration Act 1994
188: Interpretation
1: In section 3(1), after the definition of business business group amnesty section 226B .
2: In section 3(1), in the definition of incremental late payment penalty section 139B(2B) section 139B(2)(b)
3: In section 3(1), in the definition of initial late payment penalty section 139B(2A) section 139B(2)(a)
4: In section 3(1), in the definition of response period
c: if the notice is a notice of proposed adjustment that is issued by a disputant and the initiating notice is either a notice of disputable decision issued by the Commissioner or a notice revoking or varying a disputable decision that is not an assessment,—
i: the 4-month period starting on the date of issue of the initiating notice, unless subparagraph (ii)
ii: the 1-year period starting on the date of issue of the initiating notice, if the notice of proposed adjustment relates solely to a claim for an amount of tax credit under section LH 2 of the Income Tax Act 2007
d: if the notice is a notice of proposed adjustment not relating solely to a claim for an amount of tax credit under section LH 2 of the Income Tax Act 2007 section 89DA
e: if the notice is a notice of proposed adjustment relating solely to a claim for an amount of tax credit under section LH 2 of the Income Tax Act 2007 section 89DA
i: the 2-year period starting on the date on which the taxpayer's notice of assessment is received at an office of the Department, if the taxpayer is not a member of an internal software development group and not a partner in a partnership to which section 68E
ii: the period starting on the date on which the taxpayer's notice of assessment is received at an office of the Department and ending on the day that is 2 years after the latest day for any member of the taxpayer's internal software development group or for the taxpayer's partnership to furnish a return of income or joint return of income for the relevant tax year under section 37 .
5:
6: In section 3(1), the definition of tax agent tax agent
a: is eligible under section 34B(2)
b: is listed by the Commissioner as a tax agent—
i: before the date on which the Taxation (Business Taxation and Remedial Matters) Act 2007 receives the Royal assent:
ii: on or after the date on which that Act receives the Royal assent, after the person applies under section 34B
c: is not later removed by the Commissioner from the list of tax agents .
7:
8: Section 188(5) repealed 15 December 2008 section 28 Taxation (Urgent Measures and Annual Rates) Act 2008 Section 188(7) repealed 15 December 2008 section 28 Taxation (Urgent Measures and Annual Rates) Act 2008 Section 188(8) repealed 15 December 2008 section 28 Taxation (Urgent Measures and Annual Rates) Act 2008
189: Keeping of business records
1: In the heading to section 22 business records business and other records
2: After section 22(2)(c)
cb: is a person to whom the RSCT rules apply and who makes a retirement scheme contribution to a retirement savings scheme: .
3: After section 22(2)(e)
eb: has a tax credit under section LH 2 of the Income Tax Act 2007
ec: is a listed research provider under section LH 15 of that Act .
4: After section 22(2)(kb)
kc: the amount of the person's tax credit under section LH 2 of the Income Tax Act 2007
kd: the person's compliance with section LH 15(1) of that Act section LH 15 of that Act
i: they meet the start-up requirements and the other continuing requirements; and
ii: the amounts derived and incurred by them in performing the research and development activities on behalf of other persons; and .
5: After section 22(2)(l)
lb: every retirement scheme contribution, and the taxable value of that contribution, made by the person to any retirement savings scheme, those records to include, without limiting the generality of the preceding provisions of this paragraph, details of the recipient of the retirement scheme contribution and the occasion of making it; and .
6: In section 22(7)(d)(iii)(C) the trust. the trust:
e: for the purposes of subsection (2)(kc)
7: Subsections (1) to (6)
190: Section 28B repealed
Section 28B
191: New section 28B inserted
After section 28
28B: Investor to advise portfolio tax rate entity of investor's tax file number
A resident of New Zealand who is an investor in a portfolio tax rate entity must give notice of the person's tax file number to the entity within 1 month of the date of a request from the entity for the tax file number.
192: New section 28C inserted
After section 28B
28C: Person advising retirement savings scheme of retirement scheme prescribed rate
A person who gives a notice that the retirement scheme prescribed rate for the person and an income year is less than 39% must include the person's tax file number in the notice.
193: Shareholder dividend statement to be provided by company
1: After section 29(1)(ia)
ib: the amount, if any, of the dividend paid to a retirement savings scheme as a retirement scheme contribution for the shareholder:
ic: the name of the retirement savings scheme to which any retirement scheme contribution was paid:
id: the amount, if any, of imputation credit used to satisfy a liability of the company for retirement scheme contribution withholding tax:
ie: the amount, if any, of imputation credit remaining after the company has used an imputation credit in satisfying a liability for retirement scheme contribution withholding tax: .
2: In section 29(1)(id) subsection (1) retirement scheme contribution withholding tax RSCT
3: In section 29(1)(ie) subsection (1) retirement scheme contribution withholding tax RSCT
194: Maori authority to give notice of amounts distributed
1: After section 31(1)(e)
eb: the amount, if any, of the distribution paid to a retirement savings scheme as a retirement scheme contribution for the shareholder:
ec: the name of the retirement savings scheme to which any retirement scheme contribution was paid:
ed: the amount, if any, of Maori authority credit used to satisfy a liability of the company for retirement scheme contribution withholding tax:
ee: the amount, if any, of Maori authority credit remaining after the company has used an imputation credit in satisfying a liability for retirement scheme contribution withholding tax: .
2: In section 31(1)(ed) subsection (1) retirement scheme contribution withholding tax RSCT
3: In section 31(1)(ee) subsection (1) retirement scheme contribution withholding tax RSCT
195: Portfolio tax rate entity to give statement to investors and request information
Section 31B(2B) and (3)
2B: A portfolio tax rate entity must give a notice required by subsection (1) or (2)
3: If subsections (1) and (2)
a: by the 30 June after the end of the tax year, if paragraph (b)
b: by the end of the second month following the month in which the corresponding income year for the portfolio tax rate entity ends, if the corresponding income year ends after the tax year.
196: Annual returns of income
1: In the heading to section 33 Annual returns Returns
2: In section 33(1) portfolio tax rate entity portfolio tax rate entity who makes payments of income tax under section HL 21 or HL 23 of the Income Tax Act 2004
3: In section 33(1) subsection (2) section HL 21 or HL 23 of the Income Tax Act 2004 section HL 22 or HL 24 of the Income Tax Act 2007
4: After section 33(1B)
1C: A portfolio tax rate entity or portfolio investor proxy who makes payments of income tax under section HL 21 or HL 23 of the Income Tax Act 2004 section 57B
5: In section 33(1C) subsection (4) section HL 21 or HL 23 of the Income Tax Act 2004 section HL 22 or HL 24 of the Income Tax Act 2007
197: Annual returns of income not required
1: After section 33A(1)(a)(iiib)
iiic: a personal service rehabilitation payment for a claimant under the Injury Prevention, Rehabilitation, and Compensation Act 2001 .
2: In section 33A(1)(a)(iv) (iiib) (iiic)
3: Section 33A(2)(d)(i)
i: a schedular payment, if it is not—
A: an amount or proportion of a schedular payment for which the Commissioner has made a determination under section RD 8(3) of the Income Tax Act 2007
B: income that is a personal service rehabilitation payment for a claimantunder the Injury Prevention, Rehabilitation, and Compensation Act 2001 .
4: After section 33A(2)(d)
db: has an amount of tax credit under section LH 2 of the Income Tax Act 2007 .
5: Subsection (4)
198: New section 33C inserted
After section 33B
33C: Return not required for certain providers of personal services
A natural person who derives income in an income year for providing personal services to a person who is a claimant under the Injury Prevention, Rehabilitation, and Compensation Act 2001
a: a personal service rehabilitation payment is made for the claimant and for the personal services; and
b: the taxable income of the person does not exceed $9,500 for the tax year; and
c: tax is withheld at the rate of 15% from the personal service rehabilitation payment; and
d: the person is not required to furnish a return of income under section 33A(1)
199: New section 34B inserted
After section 34
34B: Commissioner to list tax agents
1: The Commissioner must compile and maintain a list of persons who are tax agents.
2: A person is eligible to be a tax agent if the person—
a: prepares the returns of income required to be furnished for 10 or more taxpayers; and
b: is 1 of the following:
i: a practitioner carrying on a professional public practice:
ii: a person carrying on a business or occupation in which returns of income are prepared:
iii: the Maori Trustee.
3: A person who is not a tax agent and who is eligible to be a tax agent may give a notice (the application
a: stating that the person wishes to be listed as a tax agent; and
b: providing the information required by subsection (11)
c: providing any other information required by the Commissioner.
4: The Commissioner may request further information from the person (the applicant
5: The Commissioner must list the applicant as a tax agent if the Commissioner is satisfied by the available information that—
a: the applicant is entitled to make the application; and
b: listing the applicant as a tax agent would not adversely affect the integrity of the tax system.
6: An applicant is listed as a tax agent from the date given in the Commissioner's notice informing the applicant of the Commissioner's decision to list the applicant as a tax agent.
7: The Commissioner must refuse to list an applicant as a tax agent if the Commissioner is satisfied that—
a: the applicant is not entitled to make the application:
b: listing the applicant as a tax agent would adversely affect the integrity of the tax system.
8: The Commissioner may remove a person from the list of tax agents if the Commissioner is satisfied that—
a: the applicant is not eligible to be a tax agent:
b: continuing to list the applicant as a tax agent would adversely affect the integrity of the tax system.
9: Before refusing to put a person on the list of tax agents, or removing a person from the list, the Commissioner must—
a: give notice to the person of the Commissioner's reasons for the proposed decision:
b: consider any arguments against the proposed decision that are provided by the person within the period, beginning from the day of the notice,—
i: of 30 days, unless subparagraph (ii) or (iii)
ii: allowed by the Commissioner of less than 30 days, if the Commissioner considers such a period is necessary to protect the integrity of the tax system; or
iii: allowed by the Commissioner of more than 30 days, if the Commissioner considers such a period is appropriate in the circumstances.
10: A person listed as a tax agent is removed from the list on the date of the Commissioner's notice that informs the person of the Commissioner's decision to remove the person from the list.
11: An entity that is not a natural person must provide to the Commissioner the information described in subsection (12)
a: makes an application under subsection (3)
b: is a tax agent who—
i: has not made an application under subsection (3)
ii: has previously provided information to the Commissioner as required by this subsection and that information is inaccurate.
12: The information that subsection (11)
a: each person having the duties of tax manager, chief financial officer, chief executive officer, or director, if the entity is a body corporate other than a closely-held company:
b: each shareholder of the entity, if the entity is a closely-held company:
c: each partner in the entity, if the entity is a partnership:
d: each member of the entity, if the entity is an unincorporated body.
13: An entity that is a tax agent and is required by subsection (11)
a: the day 12 months after the day on which the Taxation (Business Taxation and Remedial Matters) Act 2007 receives the Royal assent, if the entity has not made an application under subsection (3) subsection (11)
b: the end of the 12-month period beginning from the first day on which the information most recently provided to the Commissioner as required by subsection (11)
200: Dates by which annual returns to be furnished
After section 37(4A)
4B: If the Commissioner extends under subsection (4)
201: Returns to annual balance date
In section 38(1B) section HL 22 of the Income Tax Act 2004 section HL 23 of the Income Tax Act 2007
202: Annual returns by persons who receive subpart KD credit
1: In section 41(3)(b) family tax credit minimum family tax credit
2: Subsection (1)
203: New section 41B inserted
1: After section 41A
41B: Return by person claiming rebate on redundancy payment
1: A person allowed a rebate under section KC 6 of the Income Tax Act 2004
2: An application under subsection (1)
a: any information the Commissioner requires, including—
i: the amount of the payment that is a redundancy payment under section KC 6 of the Income Tax Act 2004
ii: the name of the payer of the redundancy payment; and
iii: the date on which the redundancy payment was made; and
b: written verification of the details referred to in paragraph (a)
3: An application for a refund must be made in the period—
a: beginning after the date of the redundancy payment; and
b: ending with the day that is 4 years after the date of the redundancy payment.
4: When the Commissioner has considered an application for a refund, the Commissioner must, by notice, inform the taxpayer of the amount of the rebate allowed under section KC 6 of the Income Tax Act 2004
5: A refund allowed under subsection (1)
6: A refund allowed under subsection (1) section 142D
7: Part 7
8: Part 9
2: In section 41B, as inserted by subsection (1) section KC 6 of the Income Tax Act 2004 sections ML 1 to ML 3 of the Income Tax Act 2007
204: Non-active companies may be excused from filing returns
1: After section 43A(2)(d)(ii)
iib: give rise to an amount of tax credit under section LH 2 of the Income Tax Act 2007 .
2: Subsection (1)
205: New section 47B inserted
After section 47
47B: RSCT statements provided by retirement scheme contributor or retirement savings scheme
1: This section applies when a retirement scheme contributor or retirement savings scheme withholds an amount of RSCT from a retirement scheme contribution other than a contribution made by way of an imputation credit or Maori authority credit.
2: The contributor or scheme must provide to the Commissioner a statement in a form acceptable to the Commissioner showing the amount of retirement scheme contribution, the amount of RSCT relating to the contribution, and any other particulars required by the Commissioner.
3: The statement must be provided no later than the 20th of the month after the month in which the amount was withheld. 2004 No 35 s NEB 3(1)(b) .
206: New section 48B inserted
1: After section 48
48B: Reconciliation statement for retirement scheme contribution withholding tax
1: If a retirement scheme contributor has made a retirement scheme contribution to a retirement savings scheme for a person in an income year, the retirement scheme contributor, or the retirement savings scheme acting on behalf of the retirement scheme contributor, must deliver to the Commissioner a reconciliation statement for the income year showing the information required by—
a: subsection (2)
b: subsection (3)
2: The reconciliation statement must show the following information for the income year relating to the person referred to in subsection (1)
a: the total amount of retirement scheme contribution withholding tax payable on retirement scheme contributions; and
b: the total amount of imputation credits and Maori authority credits used in meeting the liability for retirement scheme contribution withholding tax; and
c: the total amount of retirement scheme contribution withholding tax paid or payable other than by using imputation credits and Maori authority credits; and
d: the amount of each retirement scheme contribution subject to retirement scheme contribution withholding tax; and
e: the rate used to calculate the retirement scheme contribution withholding tax on the retirement scheme contribution; and
f: the retirement scheme contribution withholding tax for the retirement scheme contribution; and
g: the amount of imputation credits attached to the retirement scheme contribution; and
h: the amount of imputation credits used to meet the liability for retirement scheme contribution withholding tax on the retirement scheme contribution; and
i: the amount of Maori authority credits attached to the retirement scheme contribution; and
j: the amount of Maori authority credits used to meet the liability for retirement scheme contribution withholding tax on the retirement scheme contribution; and
k: the amount of retirement scheme contribution withholding tax remaining owing on the retirement scheme contribution after the use of imputation credits and Maori authority credits; and
l: the amount of retirement scheme contribution withholding tax on the retirement scheme contribution paid other than by the use of imputation credits and Maori authority credits; and
m: the tax file number, if a rate of less than 39% is used to calculate the retirement scheme contribution withholding tax on a retirement scheme contribution; and
n: the amount of the imputation credits or Maori authority credits attached to the retirement scheme contribution that are not used to meet the liability for retirement scheme contribution withholding tax; and
o: the total amount of non-resident withholding tax payable on retirement scheme contributions; and
p: the amount of each retirement scheme contribution that is non-resident withholding income; and
q: any other particulars the Commissioner may require.
3: The reconciliation statement must show the following information for the income year relating to the retirement scheme contributor referred to in subsection (1)
a: the total amount of retirement scheme contributions for which retirement scheme contribution withholding tax is payable; and
b: the total amount of retirement scheme contribution withholding tax payable on retirement scheme contributions; and
c: the total amount of imputation credits used in meeting the liability for retirement scheme contribution withholding tax; and
d: the total amount of Maori authority credits used in meeting the liability for retirement scheme contribution withholding tax; and
e: the total amount of retirement scheme contribution withholding tax paid or payable other than by using imputation credits and Maori authority credits.
4: The reconciliation statement required by subsection (1)
2: In section 48B(2), as inserted by subsection (1)
a: in paragraphs (a) to (f), (h), and (j) to (n), retirement scheme contribution withholding tax RSCT
b: in paragraph (o), non-resident withholding tax NRWT
c: in paragraph (p), non-resident withholding income non-resident passive income
3: In section 48B(3), as inserted by subsection (1) retirement scheme contribution withholding tax RSCT
207: Portfolio tax rate entities and portfolio investor proxies to make returns, file annual reconciliation statement
1: In section 57B(1) paragraph (a) section HL 22 or HL 23 of the Income Tax Act 2004 section HL 23 or HL 24 of the Income Tax Act 2007
2: Section 57B(1)(b)
b: by the day that is the end of the month beginning from the end of the portfolio calculation period.
3: In section 57B(2) section HL 22 of the Income Tax Act 2004 section HL 23 of the Income Tax Act 2007
4: In section 57B(3) paragraph (a) section HL 23 of the Income Tax Act 2004 section HL 24 of the Income Tax Act 2007
5: Section 57B(3)(a)(ii)
ii: by the day given by subsection (3B) .
6: After section 57B(3)
7: A person who is required to perform responsibilities under subsection (3)(a)
a: the end of the 1-month period beginning from the end of the portfolio investor exit period, if paragraphs (b) and (c)
b: the 15 January following the end of the portfolio investor exit period, if the portfolio investor exit period ends in November; or
c: the end of the month beginning from the end of the month in which the portfolio investor exit period ends, if the day given by paragraph (a)
7: In section 57B(4)(a)(ii)
a: section HL 22 or HL 23 of the Income Tax Act 2004 section HL 23 or HL 24 of the Income Tax Act 2007
b: section HL 21(5) section HL 22(5)
8: In section 57B(4)(b) for the tax year income tax
9: After section 57B(6)
7: A person who is a portfolio tax rate entity or portfolio investor proxy and makes a payment of income tax under section HL 23B of the Income Tax Act 2004 subsection (3)
a: in the prescribed form showing—
i: the amount of the payment for the period; and
ii: the information concerning the payment that would be required in a return under subsection (3)
iii: further information that the Commissioner considers relevant; and
b: by the day that is—
i: the end of the month beginning from the end of the month in which the period ends, if subparagraph (ii)
ii: the 15 January following the end of the period, if the period ends in November.
10: In section 57B(7) as added by subsection (9) section HL 23B of the Income Tax Act 2004 section HL 25 of the Income Tax Act 2007
208: Disclosure of interest in foreign company or foreign investment fund
1: After section 61(1B)
1C: A portfolio tax rate entity that does not make payments of tax under section HL 22 of the Income Tax Act 2004 subsection (1) section 57B
2: In section 61(1C) as added by subsection (1) section HL 22 of the Income Tax Act 2004 section HL 23 of the Income Tax Act 2007
209: New sections 68D and 68E inserted
1: Before section 69
68D: Statements in relation to research and development tax credits: single persons
1: This section applies to a person who—
a: is not a member of an internal software development group; and
b: is not a partner in a partnership to which section 68E
2: The person must furnish, in the form and electronic format prescribed by the Commissioner, a statement in relation to research and development tax credits under section LH 2 of the Income Tax Act 2007
3: The statement described in subsection (2)
a: the day that is 30 days after the last day for furnishing a return of income for the relevant tax year under section 37
b: the day that is 2 years after the last day for furnishing a return of income for the relevant tax year under section 37
i: that tax year is the 2008–09 or 2009–10 tax year; and
ii: the person has not claimed, in a return of income for that tax year, research and development tax credits under section LH 2 of the Income Tax Act 2007
4: A person is treated as complying with this section for the purposes of section LH 2(1)(d) of the Income Tax Act 2007 subsection (3)
68E: Statements in relation to research and development tax credits: internal software development groups and partnerships
1: This section applies to—
a: an internal software development group:
b: a partnership that chooses to apply this section.
2: The nominated member of an internal software development group or the partnership must furnish, in the electronic format prescribed by the Commissioner, a statement in relation to research and development tax credits under section LH 2 of the Income Tax Act 2007
3: The statement described in subsection (2)
a: the day that is—
i: 30 days after the latest day for any member of the internal software group or for the partnership to furnish a return of income or joint return of income for the relevant tax year under section 37
ii: such later day that the Commissioner may allow, if the Commissioner considers that a failure to meet the requirements of subparagraph (i)
b: the day that is 2 years after the latest day for any member of the internal software group or for the partnership to furnish a return of income or joint return of income for the relevant tax year under section 37
i: that tax year is the 2008–09 or 2009–10 tax year; and
ii: no member or partner has claimed, in a return of income for that tax year, research and development tax credits under section LH 2 of the Income Tax Act 2007
4: A member of an internal software development group and a partner in a partnership are treated as complying with this section for purposes of section LH 2(1)(d) of the Income Tax Act 2007 subsection (3)
2: Subsection (1)
210: Particulars to be included in income statement
1: In section 80E(2)(ea) family support and family plus Working for Families tax credits
2: Subsection (1)
211: What Commissioner must do on receipt of application
In section 80KD(2)(c),—
a: in subparagraph (ii), family support family tax credit
b: in subparagraph (iii), in-work payment in-work tax credit
c: in subparagraph (vi), family tax credit minimum family tax credit
212: Payment by instalment of family support (without abatement)
1: In the heading to section 80KK, family support family tax credit family support family tax credit
2: In section 80KK(3)(a)(ii), family assistance credit WFF tax credit
213: Payment of tax credit by chief executive
In section 80KN(1)(b) and (2), family assistance credit WFF tax credit
214: Determining family assistance credit
1: In the heading to section 80KO, family assistance credit WFF tax credit
2: In section 80KO, family assistance credit WFF tax credit
3: In section 80KO(b), family support family tax credit
215: When entitlement to income-tested benefit ends
In section 80KP, in subsections (1) and (2), family support family tax credit
216: No authority to pay family assistance credit
1: In the heading to section 80KQ, family assistance credit WFF tax credit
2: In section 80KQ(1), family assistance credit WFF tax credit
217: Request by chief executive to stop payment of family assistance credit
1: In the heading to section 80KR, family assistance credit WFF tax credit
2: In section 80KR(1)(b), family assistance credit WFF tax credit
218: Payment of tax credit taken over by Commissioner
1: In section 80KU(1)(b), family assistance credit, family tax credit, or family support WFF tax credit, family tax credit, or minimum family tax credit
2: In section 80KU(2), in-work payment in-work tax credit
219: Effect of extra instalment on entitlement to tax credit
1: In section 80KW(1)(a), family assistance credit or family tax credit WFF tax credit or minimum family tax credit
2: Section 80KW(2)(b) is replaced by the following:
b: when the person has received payments under section 80KI subsection (1)(c)(i)
3: In section 80KW(4)(a)(i), family assistance credit WFF tax credit
4: In section 80KW(4)(a)(ii), family tax credit minimum family tax credit
5: Section 80KW(5)(b) is replaced by the following:
b: when the person has received payments under section 80KN subsection (1)(c)(ii)
6: In section 80KW(7)(a)(i), family assistance credit WFF tax credit
7: In section 80KW(7)(a)(ii), family tax credit minimum family tax credit
220: Officers to maintain secrecy
1: Before section 81(4)(g)
fc: communicating to a person who is a member, employee, or agent, of the New Zealand Customs Service, information that—
i: the person is authorised by the New Zealand Customs Service to receive; and
ii: relates to a person who is liable to pay financial support under the Child Support Act 1991
iii: the Commissioner considers is not undesirable to disclose and is reasonably necessary for the purposes specified in sections 280K and 280L of the Customs and Excise Act 1996 .
2: After section 81(4)(lb)
lc: communicating to a taxpayer whose return of income is being or has been prepared by another person as an agent of the taxpayer—
i: whether the person is listed as a tax agent:
ii: any decision of the Commissioner removing the person from the list of tax agents or refusing to list the person as a tax agent: .
221: Disclosure of information concerning actions of tax advisor
1: The heading to section 81B Disclosure of information concerning tax advisor or person acting as tax agent
2: In section 81B
2: Despite section 81
a: the person is, or purports to be, a member of the association or group as a person who is in a business of preparing tax returns for other people; and
b: the members of the association or group are subject to—
i: a professional code of conduct; and
ii: a disciplinary process that enforces compliance with the code of conduct; and
c: the information—
i: is relevant to a decision of the Commissioner removing the person from the list of tax agents or refusing to list the person as a tax agent:
ii: in the Commissioner's opinion, is or would be relevant to a decision referred to in subparagraph (i)
222: Disclosure of information for purposes of entitlement card
In section 83(2) family assistance credit WFF tax credit
223: Disclosure of information for family support double payment identification
1: In section 84(1)(a) and (4) family assistance credit WFF tax credit
2: In section 84(6) family assistance credit WFF tax credit .
224: Disclosure of information in relation to family income assistance
1: In section 85G
a: in the heading: family income assistance Working for Families tax credits
b: in subsection (1)(a) family support credit family tax credit
2: In section 85G(1)(a) and (4)(a) and (b) family assistance credit WFF tax credit
3: In section 85G(6) family assistance credit WFF tax credit .
4: Subsection (1)
5: Subsections (2) (3)
225: Use of information supplied under section 85GA
In the heading to section 85GC section 85GA section 85GB
226: Where Commissioner accepts adjustment proposed by disputant
Section 89J
1: If the Commissioner accepts or is deemed to accept an adjustment proposed by a disputant, and section 89L
a: a notice of assessment issued to the disputant; and
b: any further notice of assessment or further amended assessment issued to the disputant.
2: Despite subsection (1)
a: was fraudulent:
b: wilfully misled the Commissioner.
227: Determinations relating to financial arrangements
1: After section 90AC(1)(b)
bb: the method that may be applied to determine the income derived or expenditure incurred for a financial arrangement or class of financial arrangements under section EW 15B(5)(c) or EW 15D(2)(d) of the Income Tax Act 2004 .
2: In section 90AC(1)(bb), as inserted by subsection (1) section EW 15B(5)(c) or EW 15D(2)(d) of the Income Tax Act 2004 section EW 15E(2)(d) or EW 15I(2)(c) of the Income Tax Act 2007
228: Determination on type of interest in FIF and use of fair dividend rate method
1: Section 91AAO(2)
2: In making a determination, the Commissioner may take into account the following:
a: the principle that the fair dividend rate method should not be used for an attributing interest in a FIF that is economically equivalent to a loan denominated in New Zealand dollars:
b: the extent to which the assets of a FIF—
i: are loans, fixed rate shares as defined in section LF 2 of the Income Tax Act 2004
ii: are denominated in New Zealand dollars:
iii: have a value in New Zealand dollars that is substantially unaffected by variations in currency exchange rates:
c: the compliance costs incurred by a person required to use the fair dividend rate method:
d: arrangements affecting the assets of a FIF and interests held directly or indirectly in a FIF.
3: A determination may be made for income years specified in the determination.
3B: A determination does not apply for a person and an income year beginning before the date of the determination unless the person chooses that the determination apply for the income year.
2: Section 91AAO(2)(b)(i), as inserted by subsection (1)
i: are loans, fixed-rate shares as defined in section LL 9 of the Income Tax Act 2007 .
3: Section 91AAO(5)
5: The Commissioner must:
a: notify the making of a determination in the Gazette
b: publish the determination in a publication of the department as soon as possible.
229: New heading and section 91AAP inserted
Section 229 repealed 15 December 2008 section 28 Taxation (Urgent Measures and Annual Rates) Act 2008
230: Taxation laws in respect of which binding rulings may be made
1: In section 91C(1)(f) subparagraph (i) paragraphs (a) to (e) paragraphs (a) to (eb)
2: In section 91C(1)(f)(i) paragraph (e) paragraph (e) or (eb)
3: After section 91C(3)
4: Despite subsection (1)
a: whether a person meets the eligibility requirements in section LH 3 of the Income Tax Act 2007
b: whether expenditure or depreciation loss meets the requirements of the definition of eligible expenditure section LH 4 of that Act
c: whether an activity meets the requirements of the definition of research and development activities in section LH 7 of that Act
4: Subsections (1) (2)
5: Subsection (3)
231: New section 98B inserted
1: After section 98
98B: Assessment of retirement scheme contribution withholding tax
1: The Commissioner may, for any person who is chargeable with retirement scheme contribution withholding tax under section NEB 2 of the Income Tax Act 2004
2: The person is liable to pay the tax so assessed except to the extent that the person establishes in proceedings challenging the assessment that the assessment is excessive or that the person is not chargeable with the tax assessed.
3: Sections 109, 111, and 113 subsection (1) of this section
a: in those sections, the term taxpayer
b: in section 113 tax already assessed subsection (1) of this section
4: An assessment made under this section shall be subject to challenge in the same manner as an assessment of income tax imposed under section BB 1 of the Income Tax Act 2004 Part 8A of this Act
2: Section 98B(1), as inserted by subsection (1)
1: The Commissioner may, for any person who is chargeable with RSCT under section RH 2 of the Income Tax Act 2007
3: Section 98B(3)(a) and (b), as inserted by subsection (1)
a: in those sections, the term 'taxpayer' included a person who is chargeable with RSCT; and
b: in section 113 tax already assessed subsection (1) of this section
4: In section 98B(4), as inserted by subsection (1) Income Tax Act 2004 Income Tax Act 2007
232: Time bar for amendment of income tax assessment
1: After section 108(1A)
1B: Despite subsection (1) section LH 2 of the Income Tax Act 2007
a: a taxpayer furnishes an income tax return for the 2008–09 or a later tax year; and
b: 2 years have passed from the end of the tax year in which the taxpayer provides the tax return; and
c: the taxpayer has not issued a notice of proposed adjustment to the Commissioner for an amount of research and development tax credit for the relevant tax year within the relevant response period.
2:
3:
4: Section 232(2) repealed 15 December 2008 section 28 Taxation (Urgent Measures and Annual Rates) Act 2008 Section 232(3) repealed 15 December 2008 section 28 Taxation (Urgent Measures and Annual Rates) Act 2008 Section 232(4) repealed 15 December 2008 section 28 Taxation (Urgent Measures and Annual Rates) Act 2008
233: Extension of time bars
1: In section 108B(3)(d) section 108 section 108(1)
2: Subsection (1)
234: Commissioner may at any time amend assessments
1: In section 113(1) section 89N sections 89N and 113D
2: Subsection (1)
235: New section 113D inserted
1: After section 113C
113D: Amended assessments for research and development tax credits
If a taxpayer has issued a notice of proposed adjustment for their claim for an amount of research and development tax credit under section LH 2 of the Income Tax Act 2007 .
2: Subsection (1)
236: Residual income tax of new provisional taxpayer
1: Section 120KC(1)(b)
b: in 2 equal instalments on the interest instalment dates, for the corresponding year,—
i: D and F, if section RC 9(9)(b)(i)
ii: C and F, if section RC 9(9)(b)(ii) .
2: Subsection (1)
237: Heading to example replaced
The heading to the example after section 120KC Example:
238: Provisional tax instalments in transitional years
1: In section 120KD(1) section 120KE(1) section 120KE(1) or (3)
2: In section 120KD(2) The date interest starts is the day after the day on which payment of the instalment is due under section RC 21 of that Act
3: Subsections (1) (2)
239: Heading to example replaced
The heading to the example after section 120KD Example:
240: Provisional tax and rules on use of money interest
1: Section 120K(E(6)
6: A taxpayer is not entitled to use of money interest for overpaid tax under section 120D
a: the day after the date—
i: on which they notify the Commissioner under section RC 18(2)
ii: set out in section RC 18(3)
b: the day after their last ratio instalment date.
2: Subsection (1)
241: Late filing penalties
1: In the heading to section 139A penalties penalty for certain returns
2: In section 139A(5) paragraph (a)
5: Except in the case of a late filing penalty resulting from an employer monthly schedule or from a tax return required under sections 16 to 18 of the Goods and Services Tax Act 1985 .
3: After section 139A(5)
6: In the case of a late filing penalty for failing to file an employer monthly schedule by the due date, the Commissioner must—
a: give notice to the taxpayer that a late filing penalty will be payable for a further failure to file an employer monthly schedule on time, if the taxpayer has filed on time all employer monthly schedules due for filing in the period—
i: beginning with the later of 1 April 1999 and the day 12 months before the due date; and
ii: ending before the due date; or
b: give notice to the taxpayer that the penalty is payable, if the taxpayer has not filed on time all employer monthly schedules due for filing in the period referred to in paragraph (a)
4: Subsections (1) (3)
5: Subsection (2) sections 16 to 18 of the Goods and Services Tax Act 1985
242: New section 139AAA inserted
1: After section 139A
139AAA: Late filing penalty for GST returns
1: This section applies to a tax return (a GST return sections 16 to 18 of the Goods and Services Tax Act 1985
2: A registered person is liable to pay a late filing penalty if—
a: the registered person does not complete and provide a GST return by the due date for filing the GST return; and
b: the registered person has failed to file on time a GST return due in the period—
i: beginning with the later of 1 April 2008 and the day 12 months before the due date; and
ii: ending before the due date; and
c: the Commissioner notifies the registered person that the penalty is payable.
3: The late filing penalty for a GST return for a registered person is—
a: $250, if on the due date for filing the GST return the registered person accounts for tax payable on an invoice basis or hybrid basis; or
b: $50, if on the due date for filing the GST return the registered person accounts for tax payable on a payments basis.
4: The Commissioner must—
a: give notice to the registered person that a late filing penalty will be payable for a further failure to file a GST return on time, if the registered person has filed on time all GST returns due for filing in the period—
i: beginning with the later of 1 April 2008 and the day 12 months before the due date; and
ii: ending before the due date; or
b: give notice to the registered person that the penalty is payable, if the registered person has not filed on time all GST returns due for filing in the period referred to in paragraph (a)
2: Subsection (1) sections 16 to 18 of the Goods and Services Tax Act 1985
243: Late payment penalty
1: Section 139B(1) to (3A)
1: This section applies to a taxpayer if and to the extent that the taxpayer does not pay by the due date (the default date unpaid tax
a: the unpaid tax is provisional tax or a penalty relating to a failure to pay provisional tax:
b: the taxpayer has failed to pay on time an amount of tax due for payment in the period—
i: beginning with the later of 1 April 2008 and the day 2 years before the default date; and
ii: ending before the default date:
c: the taxpayer has paid on time all amounts of tax due for payment in the period referred to in paragraph (b)
i: the Commissioner gives the taxpayer a notice setting a further date for payment of the unpaid tax; and
ii: the taxpayer does not pay the unpaid tax before the date that is the earlier of the further date and the date that is 1 month after the date of the notice.
2: The taxpayer is liable to pay a late payment penalty consisting of—
a: an initial late payment penalty equal to the total of—
i: 1% of the unpaid tax; and
ii: 4% of the amount of tax to pay at the end of the sixth day after the day on which a penalty under subparagraph (i)
b: an incremental late payment penalty equal to 1% of the amount of tax to pay determined on each day that falls 1 month after a day on which a penalty is imposed under—
i: this subsection:
ii: subsection (2A)(a) or (2B) section 243 of the Taxation (Business Taxation and Remedial Matters) Act 2007
3: An initial late payment penalty is added to the unpaid tax to which it relates—
a: on the day after the default date for the unpaid tax, if it is imposed under subsection (2)(a)(i)
b: at the end of the sixth day after the day referred to in paragraph (a) subsection (2)(a)(ii)
2: In section 139B(3B)
a: subsection (2A)(b) subsection (2)(a)(ii)
b: subsection (2A)(a) subsection (2)(a)(i)
3: Subsections (1) (2)
244: Imposition of late payment penalties when financial relief sought
1: In section 139BA(1)
a: section 139B(2A)(a) section 139B(2)(a)(i)
b: section 139B(2A)(b) section 139B(2)(a)(ii)
2: Subsection (1)
245: Late payment penalty and provisional tax
1: In section 139C(2), in the definition of provisional tax payable
ab: for an instalment date and a taxpayer to whom section RC 11 of the Income Tax Act 2007
i: the amount calculated under section RC 11 of that Act
ii: the amount calculated as payable under section RC 11 of that Act .
2: Subsection (1)
246: Imputation penalty tax payable where end of year debit balance
1: After section 140B(2)
3: The amount given by subsection (2) section 140BB
2: Subsection (1)
247: New section 140BB inserted
1: After section 140B
140BB: Imputation penalty tax payable in some circumstances
1: This section applies when a company has an end of year debit balance under section OA 3(3) and (4) of the Income Tax Act 2007
a: credits and balances to the extent to which they arise from memorandum account debits, credits, and balances, refunds, tax, tax credits, transfers, withholdings, or other items dealt with, arising, or calculated using an old company tax rate; and
b: debits and balances to the extent to which the company has, as provided by section OZ 8 of the Income Tax Act 2007
2: The company is liable for a special tax known as imputation penalty tax.
3: The amount of imputation penalty tax is 10% of the positive difference between zero and the end of year debit balance described in subsection (1)
2: Subsection (1)
248: Dividend withholding payment penalty tax payable where end of year debit balance
1: After section 140C(2)
3: The amount given by subsection (2) section 140CA
2: Subsection (1)
249: New section 140CA inserted
1: After section 140C
140CA: FDP penalty tax payable in some circumstances
1: This section applies when a company has an end of year debit balance under section OA 3(3) and (4) of the Income Tax Act 2007
a: credits and balances to the extent to which they arise from memorandum account debits, credits, and balances, refunds, tax, tax credits, transfers, withholdings, or other items dealt with, arising, or calculated using an old company tax rate; and
b: debits and balances to the extent to which the company has, as provided by section OZ 8 of the Income Tax Act 2007
2: The company is liable to a special tax known as FDP penalty tax.
3: The amount of imputation penalty tax is 10% of the positive difference between zero and the end of year debit balance described in subsection (1)
2: Subsection (1)
250: Tax shortfalls
1: In section 141(7)(b) or a reduction in tax to pay refund of tax
2: In section 141(7) paragraph (c) or reduction, increased refund,
3: After section 141(7)
7B: The Commissioner may exercise the discretion under subsection (7)
a: subsection (7)
b: the taxpayer's return period affected by the adjustment referred to in subsection (7)(a) subsection (7)(b)
c: the taxpayer's tax position is not an abusive tax position and does not involve evasion or a similar act.
4: After section 141(7B), the following is inserted:
7C: Subsection (7D)
a: the Commissioner makes an adjustment to a taxpayer's tax position ( taxpayer A section LH 2 of the Income Tax Act 2007 section LH 17 of that Act
b: the adjustment described in paragraph (a)
c: the Commissioner makes an adjustment to another taxpayer's tax position ( taxpayer B section LH 2 of that Act section LH 17 of that Act
d: the adjustment described in paragraph (c) paragraph (a)
e: for taxpayer B, an entitlement to an amount of refund or increased refund of tax (the refund amount paragraph (c)
f: for the period to which the adjustments described in paragraphs (a) and (c) section LH 17 of that Act
g: the tax credits described in paragraphs (a) and (c) section LH 17 of that Act
7D: If this subsection applies because of subsection (7C) of this Act subsection (7C)(e)
5: Subsections (1) to (3)
6: Subsection (4)
251: Not taking reasonable care
1: After section 141A(2)
2B: A taxpayer who, in taking a tax position, relies on an action or advice of a tax advisor engaged by the taxpayer, or by a company in the same group of companies as the taxpayer, takes reasonable care in relying on the action or advice except if the taxpayer—
a: is the employer of the tax advisor:
b: does not provide to the tax advisor adequate information relating to the tax position:
c: does not provide to the tax advisor adequate instructions relating to the tax position:
d: has reason to believe that the action or advice is incorrect:
e: has previously, for a period ending less than 4 years before the beginning of the period to which the tax position relates, had a tax shortfall for the same type of tax arising from a corresponding tax position and does not take reasonable care to avoid the further tax shortfall.
2: Subsection (1)
252: Unacceptable tax position
1: In section 141B(1B) numbers in a return numbers used in, or for use in preparing, a return
2: After section 141B(1B)
1C: A taxpayer does not take an unacceptable tax position if—
a: the taxpayer adopts IFRSs for the purposes of financial reporting before the 2007–08 income year; and
b: the taxpayer's tax position relates to a period—
i: starting on and including the first day of the first income year for which a person adopts IFRSs for the purposes of financial reporting; and
ii: finishing on and including the last day of the 2006–07 income year; and
c: a tax shortfall for a return period in the period described in paragraph (b)
d: the tax shortfall is due to an application of IFRSs which, if viewed objectively, passes the standard of being about as likely as not to represent acceptable accounting practice under IFRSs; and
e: the taxpayer has fully-disclosed the IFRS-related tax position.
3: Section 141B(2)
2: A taxpayer is liable to pay a shortfall penalty if the taxpayer takes an unacceptable tax position in relation to income tax and the tax shortfall arising from the taxpayer's tax position is more than both—
a: $50,000:
b: 1 % of the taxpayer's total tax figure for the relevant return period.
4: Section 141B(3)(b)
b: where the taxpayer has no tax to pay in respect of the return period, an amount equal to the product of—
i: the net loss of the taxpayer in respect of the return period, ascertained in accordance with the provisions of the Income Tax Act 2007
ii: the basic rate of income tax for companies in the relevant return period,— .
5: Subsections (3) (4)
253: Abusive tax position
1: Section 141D(4)
4: This section applies to a taxpayer if the taxpayer has taken an unacceptable tax position.
2: Subsection (1)
254: Evasion or similar act
1: After section 141E(2)
2B: No person shall be chargeable with a shortfall penalty under subsection (1)(b) section 141ED
2: Subsection (1)
255: New section 141ED inserted
1: After section 141EC
141ED: Not paying employer monthly schedule amount
1: A taxpayer is liable to pay a shortfall penalty (referred to as a penalty for not paying employer monthly schedule amount) if—
a: the taxpayer—
i: completes an employer monthly schedule showing an amount of tax (the returned amount
ii: provides the employer monthly schedule to the Commissioner; and
iii: fails to pay to the Commissioner by the due date an amount owing to the Commissioner (the unpaid amount
b: the Commissioner, after the due date for the returned amount, gives to the taxpayer a notice (the Commissioner's notice
i: that the taxpayer is liable to pay a penalty for failing to pay the unpaid amount by the due date and how the penalty is calculated; and
ii: of the circumstances in which further penalties will be imposed and how a further penalty will be calculated; and
iii: of actions that the taxpayer may take to avoid the imposition of further penalties; and
c: subsection (3)
2: Before giving to the taxpayer the first Commissioner's notice in relation to the returned amount, the Commissioner must give to the taxpayer a notice that a penalty may be imposed under this section if the unpaid amount is not paid.
3: A taxpayer is not liable to pay a penalty for not paying employer monthly schedule amount in relation to an unpaid amount if—
a: the taxpayer is a receiver or liquidator—
i: appointed after the end of the return period referred to in subsection (1)(a)
ii: having insufficient funds available to pay the unpaid amount:
b: the taxpayer—
i: agrees with the Commissioner, before the penalty date under subsection (4) instalment arrangement section 177B
ii: pays the unpaid amount under the instalment arrangement.
4: A penalty payable for not paying employer monthly schedule amount in relation to an unpaid amount has a due date (the penalty date
a: the date of the Commissioner's notice, if the penalty is the first penalty in relation to the returned amount; or
b: one month after the penalty date for the preceding penalty, if paragraph (a)
5: The amount of the penalty for not paying employer monthly schedule amount in relation to an unpaid amount is—
a: 10% of the unpaid amount on the day before the penalty date, if the taxpayer—
i: fails to agree to an instalment arrangement with the Commissioner before the day that is 1 month after the penalty date; and
ii: fails to pay the unpaid amount before the day that is 1 month after the penalty date; or
b: 10% of the unpaid amount on the day before the penalty date, if the taxpayer—
i: agrees to an instalment arrangement with the Commissioner before the penalty date; and
ii: fails to comply with the instalment arrangement before the day that is 1 month after the penalty date; or
c: 5% of the unpaid amount on the day before the penalty date, if—
i: the taxpayer pays the unpaid amount, or agrees to an instalment arrangement with the Commissioner, after the penalty date and before the day that is 1 month after the penalty date; and
ii: paragraph (b)
6: A taxpayer may be liable to pay more than 1 penalty for not paying employer monthly schedule amount arising from an employer monthly schedule.
7: The maximum amount of penalties under this section that may be imposed is 150% of the returned amount that is unpaid when the first penalty is imposed under this section.
8: If the penalty date for a penalty would, in the absence of this subsection, be a date in a month that does not exist in the month, the penalty date is the date of the last day in the month.
2: Subsection (1)
256: Reduction in penalty for voluntary disclosure of tax shortfall
1: Section 141G(3)(a)
a: for pre-notification disclosure is—
i: 100%, if the shortfall penalty is for not taking reasonable care, for taking an unacceptable tax position, or for an unacceptable interpretation; or
ii: 75%, if subparagraph (i) .
2: Subsection (1)
257: Reduction where temporary shortfall
1: Section 141I(3)
3: A tax shortfall is a temporary tax shortfall for the return period of a tax position if, when the Commissioner considers the assessment of a shortfall penalty, the Commissioner is satisfied that—
a: the tax shortfall has been or will be, in an earlier or later return period, permanently reversed or corrected—
i: before the end of the 4-year period beginning after the day on which the taxpayer took the tax position; and
ii: with the effect that the taxpayer pays or returns for the relevant return periods the correct total amount of tax, not including penalties and interest, in respect of the tax position; and
iii: as a result of actions taken by the taxpayer or by the operation of law or circumstances; and
b: no tax shortfall will arise in a later return period in respect of a similar tax position; and
c: no arrangement exists with the purpose or effect of creating for another return period a tax deferral or advantage related to the tax position.
2: Subsection (1)
258: Limitation on reduction of shortfall penalty
1: Section 141J
1: This section applies to a shortfall penalty payable by a taxpayer if—
a: the taxpayer makes a voluntary disclosure; and
b: the shortfall penalty is payable in respect of a temporary tax shortfall; and
c: the shortfall penalty would be reduced under section 141G or 141H
2: The shortfall penalty is reduced by—
a: 100%, if—
i: the shortfall penalty is for not taking reasonable care, for taking an unacceptable tax position, or for taking a tax position involving an unacceptable interpretation of a tax law; and
ii: the tax shortfall is voluntarily disclosed under section 141G
b: 75%, if paragraph (a)
3: A shortfall penalty to which this section applies is not reduced under any other section.
2: Subsection (1)
259: Section 141KB
1: Section 141KB
2: Subsection (1)
260: Due date for payment of late filing penalty
1: In section 142(1) or a return required by sections 16 to 18 of the Goods and Services Tax Act 1985 an employer monthly schedule
2: After section 142(1A)
1B: The due date for the payment of a late filing penalty for a return required by sections 16 to 18 of the Goods and Services Tax Act 1985
a: the 28th day of the second month following the end of the taxable period, if paragraphs (b) and (c)
b: the 15th day of February, if the month following the end of the taxable period is December; or
c: the 7th day of June, if the month following the end of the taxable period is April.
3: Subsections (1) (2) sections 16 to 18 of the Goods and Services Tax Act 1985
261: New due date for payment of tax that is not penalty
1: Section 142A(1), (1B), and (2)
1: This section applies if the Commissioner makes for a taxpayer—
a: an assessment (the new assessment) of tax for which the taxpayer has not been assessed earlier:
b: an amended assessment (the increased assessment
i: of an amount of tax exceeding the amount for which the taxpayer is liable immediately before the increased assessment; and
ii: made less than 30 days before, or on or after, the due date for the tax for which the taxpayer is liable immediately before the increased assessment.
2: The Commissioner must—
a: fix a date that is 30 or more days after the date of the notice of the assessment for the payment of—
i: the tax under a new assessment:
ii: the increase of tax under an increased assessment; and
b: give notice of the date to the taxpayer in the notice of the assessment.
2: In section 142A(3)
a: in the words before paragraph (a) Subsections (1) and (2) Subsection (2)
b: in paragraph (b) subsection (1)
3: Section 142A(4)
262: Knowledge offences
1: In section 143A(5)(f) 2006. 2006:
g: a deduction of retirement scheme contribution withholding tax.
2: Section 143A(5)(g), as inserted by subsection (1)
g: an amount of RSCT withheld.
263: Imposition of civil and criminal penalties
1: In section 149(2) , other than under section 141ED shortfall penalty
2: In section 149(5) , other than under section 141ED shortfall penalty
3: Subsections (1) (2)
264: Remission for reasonable cause
In section 183A(1)(h) 2006. 2006:
i: a penalty for not paying employer monthly schedule amount imposed by section 141ED
265: Remission consistent with collection of highest net revenue over time
In section 183D(1) paragraph (bc)
bd: a penalty for not paying employer monthly schedule amount imposed by section 141ED .
266: Small amounts of penalties and interest not to be charged
In section 183F(1) paragraph (ba)
bb: a taxpayer is not liable to pay a penalty for not paying employer monthly schedule amount if the unpaid amount on the day before the date of the Commissioner's notice under section 141ED(1)(b)
267: Power to make interim payments of family assistance credit
1: In the heading to section 225A family assistance credit WFF tax credit
2: In section 225A(2)(b)(iii) family assistance credit WFF tax credit
3: In section 225A(2)(b)(iv) family assistance credit WFF tax credit
268: New section 226B inserted
After section 226
226B: Business group amnesties
1: The Commissioner may declare an amnesty (a business group amnesty affected business
a: protection of the integrity of the tax system; and
b: collection over time of the highest net revenue that is practicable within the law.
2: The Commissioner, when declaring a business group amnesty, must announce the days that begin and end the period for which the business group amnesty is available.
3: The Commissioner may change a day that begins or ends the period for which a business group amnesty is available by an announcement made on or before the day.
4: A person is eligible to benefit from a business group amnesty if the person—
a: is carrying on the affected business when the amnesty becomes available; and
b: has carried on the affected business throughout the period of 3 income years ending before the income year in which the amnesty becomes available; and
c: has not previously benefited from a business group amnesty; and
d: has not been notified of a pending tax audit or investigation before the amnesty becomes available.
5: During the period for which a business group amnesty is available, a person may give a notice to the Commissioner in a form prescribed by the Commissioner—
a: stating that the person wishes to benefit from the amnesty; and
b: stating that the person is carrying on the affected business; and
c: stating the period for which, and the place at which, the person has carried on the affected business as a business; and
d: providing a statement of assets and liabilities for the income year ending before the income year in which the business group amnesty becomes available; and
e: giving details of actions and omissions relating to the business that the person considers might give rise to an assessment, amended assessment, or prosecution if the person did not benefit from the amnesty; and
f: providing any other information required by the Commissioner.
6: A person who is eligible under subsection (4) subsection (5)
7: The Commissioner may, as if the business group amnesty were not declared,—
a: investigate the financial affairs of an affected person for the period of—
i: the income year ending before the income year in which the Commissioner declares the amnesty; and
ii: the income year in which the Commissioner declares the amnesty; and
b: make an assessment or amended assessment of the affected person for the income years referred to in paragraph (a)
8: After an affected person gives a notice under subsection (5) subsection (7)(a)
a: begin an investigation of the income and deductions of the affected person relating to the affected business:
b: make an assessment or amended assessment of the affected person based on figures for income and deductions relating to the affected business that differ from the figures for income and deductions relating to the affected business included by the affected person in a return of income provided before the date of the notice under subsection (5) subsection (10)
9: After an affected person gives a notice under subsection (5)
a: the affected person provides information relating to the action or omission to the Commissioner; and
b: subsection (10)
10: The Commissioner may make an assessment, make an amended assessment, or bring a prosecution, that would otherwise be contrary to subsection (8) or (9) subsection (5)
11: The Commissioner must report in writing to the Minister on the results of a business group amnesty in a report accompanying a report under section 141L
12: The Minister must lay a copy of the report before the House of Representatives at the same time as the report under section 141L
3: Amendments to other Acts and Regulations
Estate and Gift Duties Act 1968
269: Exemption for gifts to charities and certain bodies
1: In section 73(2)(l) of the Estate and Gift Duties Act 1968 1996. 1996:
m: any gift to the trustee of the Tokelau International Trust Fund, as defined in section OB 1 of the Income Tax Act 2004
2: Section 73(2)(m), as inserted by subsection (1)
m: any gift to the trustee of the Tokelau International Trust Fund, as defined in section YA 1 of the Income Tax Act 2007
3: In section 73(2)(m) of the Estate and Gift Duties Act 1968, trust. trust:
n: any gift to the trustee of the Niue International Trust Fund, as defined in section OB 1 of the Income Tax Act 2004
4: Section 73(2)(n), as inserted by subsection (3)
n: any gift to the trustee of the Niue International Trust Fund, as defined in section YA 1 of the Income Tax Act 2007 Goods and Services Tax Act 1985
270: Goods and Services Tax Act 1985 Sections 271 to 279 Goods and Services Tax Act 1985
271: Interpretation
1: This section amends section 2(1)
2: In the definition of tax invoice section 24 sections 24 and 24BA
272: Value of supply of goods and services
1: In section 10(7) section YA 2 and schedule 21 of the Income Tax Act 2004 sections CX 23 sections CX 18
2: In section 10(7) section ZA 2 and schedule 49 of the Income Tax Act 2007 sections CX 27 sections CX 20
273: Zero-rating of goods
1: After section 11(1)(e)
eb: subject to subsection (4)
i: are supplied to a recipient who is a non-resident; and
ii: have been entered for export under the Customs and Excise Act 1996
iii: are exported by the recipient; and
iv: are not intended by the recipient for later importation into New Zealand for use other than in making taxable supplies or exempt supplies, with the absence of such an intention being confirmed by the recipient in a document retained by the supplier; and
v: are not used or altered by the recipient before being exported, except to the extent necessary to prepare the goods for export; and
vi: leave New Zealand under an arrangement agreed by the supplier and the recipient at or before the time of the supply; and
vii: do not leave New Zealand in the possession of a passenger or crew member of an aircraft or ship; or
2: In section 11(1)(l(i)
l: the goods supplied are consumable stores intended for use on—
i: an aircraft on a flight, or going, to a destination outside New Zealand; or
ii: a fishing ship outside, or going outside, New Zealand fisheries waters; or
iib: a ship, other than a pleasure craft, carrying consumable stores to a foreign-going ship or to a fishing ship that meets the requirements in subparagraph (ii) .
3: In section 11(4)
a: If subsection (1)(d) or (1)(e) If subsection (1)
b: subsection (1)(d) and (1)(e) subsection (1)(d), (e), and (eb)
4: In section 11(9) consumable stores paragraph (a) intend to consume have available to consume
5: In section 11(9) foreign-going ship foreign-going ship
274: Zero-rating of services
In section 11A(1)(m)(i) section 11(1)(a) to (e) section 11(1)(a) to (eb)
275: Special returns
1: In section 17(1) , on or before the 28th day of the month following the month within which the sale was made,
2: After section 17(1)
1B: A return that a person is required to furnish to the Commissioner under subsection (1)
a: the 28th of the month following the end of the month in which the relevant sale was made, if paragraphs (b) or (c)
b: the 15th day of January, if November is the month in which the relevant sale was made; or
c: the 7th day of May, if March is the month in which the relevant sale was made.
3: Subsections (1) (2)
276: Calculation of tax payable
In section 20(2)(a) sections 24 and 25 sections 24, 24BA, and 25
277: New section 24BA inserted
After section 24
24BA: Shared tax invoices
1: A shared invoice is a tax invoice, if the invoice contains the following particulars:
a: the words tax invoice
b: the name and registration number of the principal supplier:
c: the name and address of the recipient:
d: the date upon which the tax invoice is issued:
e: a description of the goods and services supplied:
f: the consideration for the supply, inclusive of tax charged, and—
i: the tax charged, and the consideration for the supply, excluding tax charged; or
ii: where the amount of tax charged is the tax fraction of the consideration, a statement that the consideration includes a charge in respect of the tax.
2: A tax invoice under this section is treated as provided by each supplier.
3: Where a tax invoice to which this section applies has been issued in respect of a supply, the principal supplier must maintain sufficient records to enable the name, address, and registration number, if any, of the supply's supplier to be ascertained.
4: For the purposes of this section,— principal supplier
a: the supplier responsible for issuing the invoice, unless paragraph (b)
b: the representative member of a group of companies for the purposes of section 55 shared invoice section 5(2)
a: have statutory obligations which make it practical to use a single invoice:
b: are part of the same group of companies for the purposes of section 55
278: Relief from tax where new start grant made
1: In section 48A(3)(a) section CX 41B(4) or EW 47B(4) of the Income Tax Act 2004 section CX 48(4) or EW 46(4) of the Income Tax Act 2007
2: In section 48A(3) paragraph (c) section CX 41B(4) and (5) or section EW 47B(4) and (5) of the Income Tax Act 2004 section CX 48(4) EW 46(4) and (5) of the Income Tax Act 2007
279: Group of companies
1: Section 55(1)
1: For the purposes of this Act, 2 or more companies (the companies
a: at the time and under section IG 1 of the Income Tax Act 2004
i: are a group of companies:
ii: are part of a group of companies:
iii: would be a group of companies or part of a group of companies but for 1 or more of the companies being a portfolio tax rate entity; and
b: the companies,—
i: at the time, are each a registered person:
ii: in a 12-month period that includes the time, make a total value of taxable supplies to persons other than the companies that is at least 75% of the total value of all supplies made in that period by the companies to persons other than the companies.
2: In section 55(1)(a) subsection (1) section IG 1 of the Income Tax Act 2004 section IC 3 of the Income Tax Act 2007 Income Tax Act 1994
280: Income Tax Act 1994
Sections 281 to 288 Income Tax Act 1994
281: Public and local authorities' exempt income
Section CB 3(b)(ii)(A)
A: any council-controlled organisation, other than a council-controlled organisation operating a hospital as a charitable activity on behalf of the local authority: .
282: Non-profit bodies' and charities' exempt income
1: In section CB 4(1)(n) trust. trust:
o: any amount derived by the trustee of the Tokelau International Trust Fund.
2: In section CB 4(1)(o), Fund. Fund:
p: any amount derived by the trustee of the Niue International Trust Fund.
3: Section CB 4(3)(a) and (b)
a: a council-controlled organisation, other than a council controlled organisation operating a hospital as a charitable activity:
b: a local authority in respect of income derived from a council-controlled organisation, other than from a council-controlled organisation operating a hospital as a charitable activity on behalf of the local authority.
4: Subsection (1)
5: Subsection (2)
283: Other exempt income
1: In section CB 9(i) grant. grant:
j: any amount derived as a distribution from the trustee of the Tokelau International Trust Fund.
2: In section CB 9(j), Fund. Fund:
k: any amount derived as a distribution from the trustee of the Niue International Trust Fund.
3: Subsection (1)
4: Subsection (2)
284: What constitutes an interest in a foreign investment fund
1: After section CG 15(2)
2B: If a person is treated under section CG 23(7) to (8) subsection (2)(d)
2: Subsection (1)
285: Companies required to maintain imputation credit account
In section ME 1(2)(i) section 24 section 266
286: Use of credit to reduce dividend withholding payment, or use of debit to satisfy income tax liability
1: After section MF 5(5)
5B: An election made in respect of a company (the first company section MF 5(4) section MF 10(4) section MF 4(1)(a) e
5C: An amount of election that is invalid under subsection (5B)
a: is not recorded as a credit in the branch equivalent tax account of the company that makes the election:
b: is not an amount of debit balance in respect of which the election is made:
c: does not relate to the election.
2: Subsection (1) subsection (1)
3: If subsection (1) subsection (2) subsection (1)
287: Use of consolidated group credit to reduce dividend withholding payment or use of group or individual debit to satisfy income tax liability
1: After section MF 10(4)
4B: An election made in respect of a consolidated group under section MF 10(3) section MF 10(3)(a) to (c) section MF 8(2)(a) e
4C: An election made in respect of a company (the first company section MF 10(4) section MF 5(4) section MF 4(1)(a) e
4D: An amount of election that is invalid under subsections (4B) or (4C)
a: is not recorded as a credit in the branch equivalent tax account of the company or consolidated group (as the case may be) that makes the election:
b: is not an amount of debit balance in respect of which the election is made:
c: does not relate to the election.
2: Subsection (1) 1997–98 subsection (1)
3: If subsection (1) subsection (2) subsection (1) Section 287(2) amended 6 October 2009 section 860 Taxation (International Taxation, Life Insurance, and Remedial Matters) Act 2009
288: Definitions
1: This section amends section OB 1
2: After the definition of New Zealand tax Niue International Trust Fund .
3: In the definition of taxable bonus issue paragraph (b)
b: any bonus issue that the company elects in accordance with section CF 8(a) section 3(3)(a)(i) of the Income Tax Act 1976
i: is issued fully paid from the reserves of the company:
ii: would not be exempt income under section CB 10(2) to (5) .
4: After the definition of timing regime Tokelau International Trust Fund .
5: Subsection (3) Taxation Review Authorities Act 1994
289: Taxation Review Authorities Act 1994 Sections 290 291 Taxation Review Authorities Act 1994
290: New section 22B inserted
After section 22
22B: Power to order costs for filing fees
An Authority may order the Commissioner to pay to an objector or a disputant an amount of costs not more than the filing fee paid by the objector or disputant under the relevant regulation .
291: Regulations
In section 30(2)(d) this Act. this Act:
e: prescribing the circumstances in which any fees paid or to be paid in respect of the filing of any proceedings brought under this Act may be refunded, remitted, or waived, in whole or in part. Taxation (Depreciation, Payment Dates Alignment, FBT, and Miscellaneous Provisions) Act 2006
292: Taxation (Depreciation, Payment Dates Alignment, FBT, and Miscellaneous Provisions) Act 2006 Sections 18, 19, 26, 47, 49, 127, 192, 215, and 216 of the Taxation (Depreciation, Payment Dates Alignment, FBT, and Miscellaneous Provisions) Act 2006 Customs and Excise Act 1996
293: New sections 280J, 280K, and 280L inserted
After section 280I of the Customs and Excise Act 1996
280J: Defined terms for
sections 280K and 280L In sections 280K and 280L Commissioner section 3(1) of the Tax Administration Act 1994 Department financial support debt
a: financial support as defined in section 2 of the Child Support Act 1991
b: a penalty or interest under the Child Support Act 1991 identifying information officer of the Department section 3(1) of the Tax Administration Act 1994 serious default
280K: Disclosure of arrival and departure information for purposes of
Child Support Act 1991
1: The purpose of this section is to facilitate the exchange of information between the Customs and the Department for the purpose of assisting the Commissioner to—
a: locate any person who is in serious default in the payment of any financial support debt; and
b: take appropriate debt recovery action against that person.
2: For the purpose of this section, the Commissioner may supply any identifying information to the Chief Executive.
3: If, in relation to a person who is in serious default, identifying information is supplied in accordance with subsection (2)
4: If the Customs has arrival or departure information relating to a person who is in serious default, the Chief Executive may, for the purpose of this section, supply to the Commissioner any of the following information held by the Customs:
a: the person's name:
b: the person's date of birth:
c: the person's tax file number:
d: the time and date on which the person arrived in New Zealand or, as the case may be, departed from New Zealand:
e: information provided by the person when arriving in New Zealand or, as the case may be, departing from New Zealand.
5: The Chief Executive and the Commissioner may, for the purpose of this section, determine by written agreement between them—
a: the frequency with which information may be supplied:
b: the form in which information may be supplied:
c: the method by which information may be supplied.
280L: Direct access to arrival and departure information for purposes of
Child Support Act 1991
1: The purpose of this section is to facilitate the Department's access to information stored in a database for the purpose of assisting the Commissioner to—
a: locate any person who is in serious default in the payment of any financial support debt:
b: take appropriate debt recovery action against that person.
2: The Chief Executive may, for the purpose of this section, allow the Commissioner to access a database in accordance with a written agreement entered into by the Chief Executive and the Commissioner.
3: In accessing a database for the purpose of this section, the Commissioner—
a: may only search for arrival or departure information relating to preselected persons who are of interest to the Commissioner; and
b: must not search for—
i: any information other than arrival or departure information:
ii: any information about a person who is not in serious default.
4: The Commissioner must take all reasonable steps to ensure that—
a: only persons with appropriate powers delegated to them by the Commissioner—
i: have access to the database; and
ii: use the database; and
b: a record is kept of—
i: every occasion on which persons access a database; and
ii: the reason for accessing the database; and
iii: the identity of the person who accessed the database; and
c: every person who accesses a database for the purpose of this section complies with subsection (3)
5: In this section,— access a database database Health (Drinking Water) Amendment Act 2007
294: New Part 2A inserted
In section 7 of the Health (Drinking Water) Amendment Act 2007 section 69H(3)(a) section OB 1 of the Income Tax Act 2004 section YA 1 of the Income Tax Act 2007 Housing Restructuring and Tenancy Matters Act 1992
295: Amendments to Housing Restructuring and Tenancy Matters Act 1992 made in schedule 2
The amendments to the Housing Restructuring and Tenancy Matters Act 1992 schedule 2 Privacy Act 1993
296: Privacy Act 1993
Sections 297 298 Privacy Act 1993
297: Notice of adverse action proposed
After section 103(1B)
1C: Nothing in subsection (1) Child Support Act 1991 section 280K or 280L of the Customs and Excise Act 1996
298: Schedule 3—Information matching provisions
In schedule 3 Customs and Excise Act 1996 , 280K, 280L 280D Rates Rebate Act 1973
299: Amendments to Rates Rebate Act 1973 made in
schedule 2 The amendments to the Rates Rebate Act 1973 schedule 2 Social Security Act 1964
300: Amendments to Social Security Act 1964 made in schedule 2
The amendments to the Social Security Act 1964 schedule 2 Goods and Services Tax (Grants and Subsidies) Order 1992
301: Schedule—Goods and Services Tax (Grants and Subsidies) Order 1992
1: The following is added to the schedule of the Goods and Services Tax (Grants and Subsidies) Order 1992
6: The Commissioner of Inland Revenue crediting, transferring, refunding, dealing with, or otherwise paying, a person's tax credit under the Income Tax Act 2007 Tax Administration Act 1994 section LH 2 of the Income Tax Act 2007
2: Subsection (1) Health Entitlement Cards Regulations 1993
302: Amendments to Health Entitlement Cards Regulations 1993 made in schedule 2
The amendments to the Health Entitlement Cards Regulations 1993 schedule 2 Income Tax (Withholding Payments) Regulations 1979
303: Schedule-Tax deductions from withholding payments
The following is added to the schedule of the Income Tax (Withholding Payments) Regulations 1979 Part F Class of payment Rate of tax deduction A personal service rehabilitation payment for a claimant under the Injury Prevention, Rehabilitation, and Compensation Act 2001 15c per $1 . Social Security (Temporary Additional Support) Regulations 2005
304: Amendments to Social Security (Temporary Additional Support) Regulations 2005 made in schedule 2
The amendments to the Social Security (Temporary Additional Support) Regulations 2005 schedule 2 Student Allowances Regulations 1998
305: Amendments to Student Allowances Regulations 1998 made in schedule 2
The amendments to the Student Allowances Regulations 1998 schedule 2 Amendments to Income Tax Act 2007
306: Income Tax Act 2007 Sections 307 to 562 Income Tax Act 2007
307: Commencement
(1) After section A 2(1) Charitable entities
1B: Despite subsection (1), sections CW 41(2) and CW 42(1)(b)
308: Withholding liabilities
1: After section BE 1(5) Retirement scheme contributions
5B: A person who makes a retirement scheme contribution to a retirement savings scheme must pay RSCT under the RSCT rules.
2: In section BE 5 retirement savings scheme retirement scheme contribution RSCT RSCT rules
309: Disposal: amount from major development or division and not already in income
Section CB 13(2) Exclusions
2: Subsection (1) section CB 17 section CB 20 section CB 21 section CB 23
310: Residential exclusion from
sections CB 12 and CB 13 In section CB 17(1) paragraph (a) Section CB 12 Sections CB 12 and CB 13
311: Business exclusion from
section CB 12
1: In the heading to section CB 20 section CB 12 sections CB 12 and CB 13
2: In section CB 20 paragraph (a) Section CB 12 Sections CB 12 and CB 13
312: Investment exclusion from
section CB 12
1: In the heading to section CB 23 section CB 12 sections CB 12 and CB 13
2: In section CB 23 paragraph (a) Section CB 12 Sections CB 12 and CB 13
313: New section CB 23B added
After section CB 23
CB 23B: Land partially sold or sold with other land
Sections CB 6 to CB 23
a: part of the land to which the relevant section applies:
b: the whole of the land to which the relevant section applies:
c: disposed of together with other land. amount dispose land 2004 No 35 s CB 5A .
314: Certain disposals by portfolio investment entities
Section CB 26
CB 26: Certain disposals by portfolio investment entities
When this section applies
1: This section applies when—
a: a portfolio investment entity or the New Zealand Superannuation Fund (the entity
b: section CX 55
c: a dividend from the share is—
i: declared before the disposal; and
ii: paid to a holder of the share who, after the disposal, becomes entitled to the dividend. Income
2: The entity is treated as deriving an amount calculated using the formula— (declaration shares − distribution shares) × distribution. Definition of items in formula
3: In the formula,—
a: declaration shares
b: distribution shares
c: distribution
i: for a share issued by a company that has an imputation credit account, the amount of the dividend that is not fully imputed as described in section RF 9(2)
ii: otherwise, the amount of the dividend. Positive result
4: The amount calculated using the formula must be more than zero. amount company dividend imputation credit account income portfolio investment entity share 2004 No 35 s CB 4B .
315: Foreign investment fund income
1: Section CD 36(b)
b: the person calculates their foreign investment fund (FIF) income or loss in relation to the interest and the period in which the amount is paid under—
i: the comparative value method:
ii: the deemed rate of return method:
iii: the cost method:
iv: the fair dividend rate method; and
c: for a calculation under paragraph (b)(iv)
i: the FIF is not a grey list company:
ii: the person does not hold a direct income interest of 10% or more in the FIF at the beginning of the income year in which the period falls.
2: In section CD 36 grey list company income year
316: Available subscribed capital (ASC) amount
In section CD 43(27)(b) dividend dividend ( section OZ 13
317: When does person have attributed repatriation from controlled foreign company?
In section CD 45(1)(b) EX 16 EX 17
318: Prevention of double taxation of share cancellation dividends
In section CD 53(5)(b) RSCT, RWT,
319: Tax credits added to caregiver's income
Section CE 12
CE 12: Tax credits for personal service rehabilitation payments
When this section applies
1: This section applies when a person has a tax credit in a tax year under section LB 7 Income
2: An amount equal to the credit is income of the person in the corresponding income year. amount corresponding income year income income year personal service rehabilitation payment tax credit tax year 2004 No 35 s CE 12 .
320: Benefits, pensions, compensation, and government grants
1: Section CF 1(2)(g)
g: a personal service rehabilitation payment for a person under the Injury Prevention, Rehabilitation, and Compensation Act 2001
2: In section CF 1 personal service rehabilitation payment
321: Adjustments under consecutive or successive finance leases
Section CH 6
CH 6: Adjustments for certain finance and operating leases
When this section applies
1: This section applies when an adjustment is made under section FA 11 or FA 11B Income: leases that become finance leases
2: The amount of a positive adjustment under section FA 11 Income: operating leases entered into before 20 June 2007
3: The amount of the adjustment under section FA 11B amount finance lease income income year lease operating lease 2004 No 35 ss FC 8H(6), FC 8I(6) .
322: When FIF income arises
1: In section CQ 5(1)(d) and (e) any time during the year any time in the year
2: After section CQ 5(1) Treatment of transaction under section EX 63, EX 65, or EX 67
1B: If a person is treated under section EX 63(5), EX 65, or EX 67 subsection (1)(d) and (e)
323: New section CQ 7 added
After section CQ 6
CQ 7: Treatment of attributing interests subject to returning share transfer
If an attributing interest in a FIF is an original share subject to a returning share transfer, for the purposes of a person using the fair dividend rate method to calculate FIF income or loss, the attributing interest is treated as held by the share supplier. attributing interest fair dividend rate method FIF income original share returning share transfer supplier 2004 No 35 s EX 44B(5) .
324: Withdrawals
In section CS 1(6) RSCT, RWT,
325: Exclusions of withdrawals of various kinds
Section CS 2(5)
326: Meaning of petroleum miner
1: Section CT 6(1)
1: Petroleum miner
2: In section CT 6(2) paragraph (a) an activity described in subsection (3) petroleum mining operations
3: Section CT 6(3) and (4)
4: In section CT 6
a: petroleum mining operations
b: removal or restoration operations
327: New section CT 6B inserted
After section CT 6
CT 6B: Meaning of petroleum mining operations
Meaning
1: Petroleum mining operations subsection (2) subsection (3) Activities: inclusions
2: The activities are those carried out in connection with—
a: prospecting or exploring for petroleum:
b: developing a permit area for producing petroleum:
c: producing petroleum:
d: processing, storing, or transmitting petroleum before its dispatch to a buyer, consumer, processor, refinery, or user:
e: removal or restoration operations. Activities: exclusions
3: The activities do not include further treatment to which all the following apply:
a: it occurs after the well stream has been separated and stabilised into crude oil, condensate, or natural gas; and
b: it is done—
i: by liquefaction or compression; or
ii: for the extraction of constituent products; or
iii: for the production of derivative products; and
c: it is not treatment at the production facilities. permit area petroleum removal or restoration operations 2004 No 35 s CT 6B
328: Proceeds of share disposal by qualifying foreign equity investor
1: In section CW 12(4) foreign exempt entity
a: paragraph (c)
c: under the laws of the territory, or part of the territory, is not subject to a tax on income other than as a body that handles income of the members; and :
b: in paragraph (f)(iii) taxation laws laws
c: in paragraph (f)(iii) subparagraph (ii) subparagraph (ii)
g: does not have a holder of a direct or indirect interest in the capital of the legal entity who,—
i: is resident in New Zealand:
ii: when treated as holding the voting interests of a person associated under the 1990 version provisions with the resident, holds a voting interest of 10% or more .
2: In section CW 12(4) foreign exempt partnership
a: paragraph (c)
c: under the laws of the territory, or part of the territory, is not subject to a tax on income other than as a body that handles income of the members; and :
b: in paragraph (h)(ii) taxation laws laws
c: in paragraph (h)(ii) subparagraph (i) subparagraph (i)
i: does not have a holder of a direct or indirect interest in the capital of the legal entity who,—
i: is resident in New Zealand:
ii: when treated as holding the voting interests of a person associated under the 1990 version provisions with the resident, holds a voting interest of 10% or more .
3: In section CW 12(4) foreign exempt person
a: paragraph (d)
d: under the laws of the territory, or part of the territory, derives the proceeds from a disposal of shares or options that are held by the person; and :
b: in paragraph (e)(ii) taxation laws laws
c: in paragraph (e)(ii) subparagraph (i) subparagraph (i)
f: does not have a holder of a direct or indirect interest in the capital of the legal entity who,—
i: is resident in New Zealand:
ii: when treated as holding the voting interests of a person associated under the 1990 version provisions with the resident, holds a voting interest of 10% or more .
4: In section CW 12(5)(a) and (b)
a: under a double tax agreement that is in force between New Zealand and the territory, if there is an agreement and it provides for the residency of the person; or
b: otherwise, under the laws of the territory.
329: Payment to claimant of certain accident compensation payments
Section CW 35
CW 35: Personal service rehabilitation payments
An amount paid to a person for an income year as a personal service rehabilitation payment is exempt income of the person if—
a: they are paid the amount under the Injury Prevention, Rehabilitation, and Compensation Act 2001
b: they pay an amount to another person for providing them in the income year a key aspect of social rehabilitation referred to in the definition of personal service rehabilitation payment
c: the amount paid is equal to or more than the amount of personal service rehabilitation payment for the income year after taking into account any amount of tax withheld. amount amount of tax exempt income income year pay personal service rehabilitation payment 2004 No 35 s CW 28B .
330: Local authorities
Section CW 39(4)(c)(i)
i: a council-controlled organisation, other than a council-controlled organisation operating a hospital as a charitable activity on behalf of the local authority; or .
331: Charities: non-business income
Section CW 41(4)
4: This section does not apply to an amount of income derived by—
a: a council-controlled organisation, other than a council-controlled organisation operating a hospital as a charitable activity:
b: a local authority from a council-controlled organisation, other than from a council-controlled organisation operating a hospital as a charitable activity on behalf of the local authority.
332: Charities: business income
Section CW 42(2)
2: This section does not apply to an amount of income derived by—
a: a council-controlled organisation, other than a council-controlled organisation operating a hospital as a charitable activity:
b: a local authority from a council-controlled organisation, other than from a council-controlled organisation operating a hospital as a charitable activity on behalf of the local authority.
333: New section CW 59B inserted
After section CW 59
CW 59B: Income of and distributions by certain international funds
Trustees
1: An amount derived by a person is exempt income of the person if they are—
a: the trustee of the Niue International Trust Fund:
b: the trustee of the Tokelau International Trust Fund. Distributions
2: An amount derived by a person is exempt income of the person if the income is a distribution by—
a: the trustee of the Niue International Trust Fund:
b: the trustee of the Tokelau International Trust Fund. amount distribution exempt income income Niue International Trust Fund Tokelau International Trust Fund trustee 2004 No 35 ss CW 49C, CW 49D .
334: New section CX 50B inserted
After section CX 50
CX 50B: Contributions to retirement savings schemes
Excluded income
1: A retirement scheme contribution is excluded income of a person if they are—
a: the person for whose benefit the contribution is made to the extent to which the contribution is an amount of—
i: money:
ii: an imputation credit or a Maori authority credit that is used to meet the liability of the retirement scheme contributor for RSCT on the contribution:
b: the retirement savings scheme. Exclusions
2: Subsection (1)(a)
a: is non-resident, and the contribution is non-resident passive income:
b: supplies to the retirement scheme contributor or the retirement savings scheme, a tax rate applying to the amount of tax withheld that is less than the retirement scheme prescribed rate for the person:
c: includes the amount of the contribution in a return of income for the income year in which the contribution is made. excluded income income year non-resident non-resident passive income retirement savings scheme retirement scheme contribution retirement scheme contributor retirement scheme prescribed rate return of income 2004 No 35 s CX 42B .
335: Proceeds from certain disposals by portfolio investment entities or New Zealand Superannuation Fund
1: Section CX 55(1) What this section applies to
1: This section applies to an amount of income derived by an entity referred to in subsection (1B)
a: resident in New Zealand and not treated under a double tax agreement as not resident in New Zealand; or
b: resident in Australia and not treated as resident in a country other than Australia under an agreement that—
i: is between Australia and that other country; and
ii: would be a double tax agreement if negotiated between New Zealand and that other country. Entities
1B: The entities referred to in subsection (1)
a: a portfolio investment entity:
b: the New Zealand Superannuation Fund:
c: a life insurer in relation to that part of the life insurer that is a portfolio investment-linked life fund. When this section does not apply
1C: This section does not apply if the entity is assured, under an arrangement with another person, of having a gain on the disposal.
2: In section CX 55(2) or life insurer Fund
3: In section CX 55 portfolio investment-linked life fund
336: Portfolio investor allocated income and distributions of income by portfolio investment entities
1: Section CX 56(1) Portfolio investor allocated income
1: Portfolio investor allocated income derived under section CP 1
a: the prescribed investor rate for the investor and the portfolio calculation period is more than zero; and
b: the prescribed investor rate for the investor and the portfolio calculation period is not more than the portfolio investor rate for the investor and the portfolio calculation period when the entity calculates in relation to the portfolio investor allocated income—
i: the portfolio entity tax liability of the entity; or
ii: the amount of a payment under section HL 25
c: for a portfolio tax rate entity making payments of tax under section HL 22
2: In section CX 56(2) distribution by distribution or dividend of
3: In section CX 56(3) paragraph (a) distribution by distribution or dividend of
4: Section CX 56(3)(a)(i)
i: is a natural person or a trustee; and .
5: In section CX 56 dividend
337: Cost of revenue account property
1: Section DB 23(2)(a)
a: the person is a portfolio investment entity or a life insurer in relation to that part of the life insurer that is a portfolio investment-linked life fund; and .
2: In section DB 17 portfolio investment-linked life fund
338: Research or development
1: Section DB 34(2) paragraph 5 paragraph 68(a) paragraphs 54 to 67
2: Section DB 34(3)
3: In section DB 34(4)(a) of paragraph 2 it is an amount written off as an immaterial amount for financial reporting purposes
4: Section DB 34(4)(b)
b: would be required, if the expenditure were material, to recognise it for financial reporting purposes under paragraph 68(a) paragraphs 54 to 67
5: Section DB 34(5)(b)
b: has written off the expenditure as an immaterial amount for financial reporting purposes; and .
339: Some definitions
Section DB 35(1)
1: In this section, and in section DB 34 development paragraph 8 reporting standard research paragraph 8
340: Charitable or other public benefit gifts by company
1: Section DB 41(1)
2: In section DB 41(2)
a: The company A company
b: described in section LD 3(2) any of the kinds
3: In section DB 41(3) 5% of
341: New heading and new section DB 51B inserted
After section DB 51 Adjustments for leases that become finance leases
DB 51B: Adjustments for leases that become finance leases
When this section applies
1: This section applies when an adjustment made under section FA 11 Deduction
2: The amount of the adjustment is a deduction of the lessor or the lessee, as applicable, in the income year in which the lease becomes a finance lease. Link with subpart DA
3: This section supplements the general permission. The general limitations still apply. deduction finance lease general limitation general permission income year lease 2004 No 35 s FC 8H(7) .
342: Portfolio investment entities: zero-rated portfolio investors and allocated losses
1: In section DB 53(2)(a) or HL 23 (Payments of tax by portfolio tax rate entity choosing to pay provisional tax)
2: In section DB 53(2)(a) the end of the portfolio calculation period the end of the portfolio tax rate entity's income year
3: In section DB 53 DB 17 DB 43B
343: Accident compensation payment for attendant care
Section DF 4
DF 4: Payments for social rehabilitation
When this section applies
1: This section applies when a person is paid under the Injury Prevention, Rehabilitation, and Compensation Act 2001 Deduction
2: The person is allowed a deduction for an amount calculated using the formula— Definitions of items in formula
3: In the formula,—
a: amount paid
b: tax rate schedule 4 clause 1 Link with subpart DA
4: This section supplements the general permission and overrides the capital limitation and private limitation for the amount described in subsection (2) amount amount of tax assessable income capital limitation general limitation general permission income year pay personal service rehabilitation payment private limitation tax 2004 No 35 s DF 4 .
344: When FIF loss arises
1: In section DN 6(1)(d) at any time during the income year at any time in the year
2: In section DN 6(1)(e) at any time during the year at any time in the year
3: After section DN 6(1) Treatment of transaction under section EX 63, EX 65, or EX 67
1B: If a person is treated under section EX 63(5), EX 65 or EX 67 subsection (1)(d) and (e)
345: Acquiring film rights
1: In section DS 1(2)(c) expenditure. expenditure; or
c: section DS 2B
2: In section DS 1(4) any other provision of this Act a provision of this Act other than section DS 2B
346: Film production expenditure
1: Section DS 2(3) and (4) Exclusion
3: This section does not apply to film production expenditure if the film—
a: is produced mainly for broadcast in New Zealand by a person who operates a television station, a television network, or a cable television system:
b: is intended to be shown as an advertisement:
c: section DS 2B Timing of deduction
4: The deduction is allocated under—
a: section EJ 4
b: section EJ 7
2: In section DS 2(5) any other provision of this Act a provision of this Act other than section DS 2B
347: New section DS 2B inserted
After section DS 2
DS 2B: Expenditure when film or film right intended for disposal
When this section applies
1: This section applies when—
a: a person incurs film production expenditure or expenditure in acquiring a film right; and
b: at the time of incurring the expenditure, the person intends to dispose of the film or film right. Deduction
2: The person is allowed a deduction for the amount of the expenditure allocated under section EA 2 Link with subpart DA
3: This section overrides the capital limitation. The general permission must still be satisfied and the other general limitations still apply. amount capital limitation deduction film film production expenditure film right general limitation general permission 2004 No 35 s DS 2B .
348: Maori authorities: donations
1: In section DV 12(1)(b) of any of the kinds listed in schedule 32 to which section LD 3(2) schedule 32
2: In section DV 12(2) 5% of
349: Cost
1: In section EB 6(1) or as described in subsection (1B)(b) accounting practice
2: After section EB 6(1) Valuation at cost: agricultural produce
1B: Despite subsection (1)
a: value their closing stock at cost; and
b: include and allocate costs so that the value of their closing stock is not materially different from the value of the closing stock obtained by applying NZIAS 2, ignoring paragraph 20
3: In section EB 6(2) Financial Reporting Standard No 4 (Accounting for Inventories) approved under the Financial Reporting Act 1993 NZIAS 2
4: After section EB 6(2) Definition
3: In this section, NZIAS 41
5: In section EB 6 NZIAS 2 NZIAS 41
350: Discounted selling price
1: In section EB 9(3)(a) Financial Reporting Standard No 4 (Accounting for Inventories) approved under the Financial Reporting Act 1993 NZIAS 2
2: In section EB 9 NZIAS 2
351: Valuing closing stock consistently
1: In section EB 12 Financial Reporting Standard No 1 (Disclosure of Accounting Policies) approved under the Financial Reporting Act 1993 NZIAS 8
2: In section EB 12 NZIAS 8
352: Discounted selling price for low-turnover traders
1: In section EB 19(4)(a) Financial Reporting Standard No 4 (Accounting for Inventories) approved under the Financial Reporting Act 1993 NZIAS 2
2: In section EB 19 NZIAS 2
353: Valuing closing stock consistently for low-turnover traders
1: In section EB 22(1) Financial Reporting Standard No 1 (Disclosure of Accounting Policies) approved under the Financial Reporting Act 1983 NZIAS 8
2: In section EB 22 NZIAS 8
354: Reduction: bloodstock not previously used for breeding in New Zealand
1: In the heading to section EC 41 other than as shuttle stallions New Zealand
2: Section EC 41(1)(b)
b: before a person ( person A
3: After section EC 41(1) Further bloodstock to which this section applies
1B: This section also applies to bloodstock that, before person A acquired it, was used by another person for breeding in New Zealand if—
a: the other person transferred the bloodstock to person A under a matrimonial agreement to which section FB 18
b: the other person was a company in the same wholly-owned group as person A at the time person A acquired the bloodstock from the other person:
c: the bloodstock is a stallion that, for each year in which the stallion was used for breeding in New Zealand before being acquired by person A, was—
i: owned by a non-resident; and
ii: removed from New Zealand after the breeding season; and
iii: not subject to a reduction under this section.
355: Valuation of excepted financial arrangements
1: In section ED 1(6) Financial Reporting Standard No 1 (Disclosure of Accounting Policies) approved under the Financial Reporting Act 1993 NZIAS 8
2: In section ED 1 NZIAS 8
356: Special rate or provisional rate
After section EE 35(3) Exception
4: Section FA 11B(7)
357: Meaning of adjusted tax value
In section EE 55 Exception
2: Section FA 11B(6)
358: Meaning of annual rate
After section EE 61(7) Exception
8: Section FA 11B(7)
359: Allocation of income and deductions by portfolio tax rate entity
1: In the heading to section EG 3 income and deductions income, deductions, and tax credits
2: After section EG 3(2) Tax credits
3: A tax credit received by a portfolio tax rate entity is allocated to the portfolio allocation period under subsection (2)
3: In section EG 3 tax credit
360: Expenditure incurred in acquiring film rights in feature films
Section EJ 4(1)
1: A deduction for expenditure that a person incurs in acquiring a film right is allocated under this section if the film is a feature film and—
a: the deduction is allowed under section DS 1
b: the deduction is allowed under section DS 2
361: Expenditure incurred in acquiring film rights in films other than feature films
Section EJ 5(1)
1: A deduction for expenditure that a person incurs in acquiring a film right is allocated under this section if the film is not a feature film and—
a: the deduction is allowed under section DS 1
b: the deduction is allowed under section DS 2
362: Film production expenditure for New Zealand films
1: In the heading to section EJ 7 having no large budget screen production grant New Zealand films
2: Section EJ 7(1)
1: A deduction under section DS 2
a: the film is not one for which a large budget screen production grant is made; and
b: the film has a final certificate under section EJ 6
363: Film production expenditure for films other than New Zealand films
1: The heading to section EJ 8 Film production expenditure for other films having no large budget screen production grant
2: Section EJ 8(1)
1: A deduction under section DS 2
a: the film is not one for which a large budget screen production grant is made; and
b: the film does not have a final certificate under section EJ 6
364: What spreading methods do
1: Before section EW 14(2)(a)
aa: a method for IFRS, to which sections EW 15B to EW 151 .
2: Section EW 14(2)(e)
365: What is included when spreading methods used
1: In section EW 15(1)(a) ignoring non-contingent fees; and ignoring—
i: non-contingent fees, if the relevant method is not the IFRS financial reporting method in section EW 15D
ii: non-integral fees, if the relevant method is the IFRS financial reporting method in section EW 15D .
2: In section EW 15(1)(b) ignoring non-contingent fees; and ignoring—
i: non-contingent fees, if the relevant method is not the IFRS financial reporting method in section EW 15D
ii: non-integral fees, if the relevant method is the IFRS financial reporting method in section EW 15D .
3: In section EW 15 IFRS non-integral fee
366: New sections EW 15B to EW 151 inserted
After section EW 15
EW 15B: Applying IFRSs to financial arrangements
When sections EW 15C to EW 151
1: Sections EW 15C to EW 151 Certain methods available for use and certain mandatory
2: Sections EW 15C to EW 151
a: the methods available to the person to use for calculating and allocating income and expenditure under a financial arrangement:
b: the circumstances in which a person must use certain other methods. financial arrangement financial statements IFRS income 2004 No 35 s EW 15B
EW 15C: Preparing and reporting methods
Who this section applies to
1: A person who uses IFRSs to prepare financial statements and to report for financial arrangements must use 1 of the following methods for the financial arrangement:
a: the IFRS financial reporting method in section EW 15D
b: a determination alternative in section EW 15E
c: the expected value method in section EW 15F
d: the modified fair value method in section EW 15G Exclusions
2: Subsection (1) sections EW 15H and EW 151 fair value method financial arrangement financial statements IFRS 2004 No 35 s EW 15B(6)
EW 15D: IFRS financial reporting method
General IFRS rules
1: Under the IFRS financial reporting method, a person must allocate an amount to an income year under IFRS rules modified, as applicable, under subsection (2) Modifications
2: The allocation is modified as follows:
a: if the financial arrangement is a financial asset, an amount arising from an impaired credit adjustment under IFRSs is not allocated to an income year:
b: even though an amount arising from the use of the fair value method may be allocated to equity reserves under IFRSs, the amount must be allocated to an income year for tax purposes. Meaning of impaired credit adjustment
3: For the purposes of this section, impaired credit adjustment
a: for a financial arrangement accounted for under the fair value method, the movement in fair value through the decline in credit quality of the arrangement:
b: for a financial arrangement not accounted for under the fair value method, credit impairment adjustments made under IFRSs. amount fair value method IFRS impaired credit adjustment income year tax 2004 No 35 s EW 15C
EW 15E: Determination alternatives
When this section applies
1: This section applies when—
a: a person chooses in a return of income to use a determination alternative to IFRS for a financial arrangement; and
b: the method is available under its terms for the person to use; and
c: the financial arrangement is not treated under IFRSs as a hedge of a financial arrangement ( financial arrangement A
i: section EW 15D
ii: the method used for financial arrangement A is or was the fair value method or a method that accounts for gains and losses related to the hedge. General IFRS rules
2: The person must use 1 of the following methods modified, as applicable, under subsection (3)
a: Determination G9C: Financial arrangements that are denominated in a currency other than New Zealand dollars: an expected value approach:
b: Determination G14B: Forward contracts for foreign exchange and commodities: an expected value approach:
c: Determination G27: Swaps:
d: a determination made by the Commissioner under section 90AC(1)(bb) of the Tax Administration Act 1994
e: a method other than those set out in paragraphs (a) to (d)
i: has regard to the purposes of the financial arrangements rules under section EW 1(3)
ii: is for a financial arrangement similar to 1 to which the methods set out in paragraphs (a) to (d)
iii: results in the allocation to each income year of amounts that are not materially different from those that would have been allocated using 1 of the methods set out in paragraphs (a) to (d) Modifications
3: For a determination alternative that is Determination G9C or G14B
a: the term forward contract
b: a requirement that all companies in a group of companies to which the person belongs choose to use the determination alternative is treated as met if—
i: all companies in the group choose Determination G9C or G14B
ii: the financial arrangement is the first financial arrangement of the group for which Determination G9C or G14B Succeeding determinations
4: For the purposes of this section, the determinations set out in subsection (2)(a) to (c) amount company financial arrangement financial arrangements rules group of companies IFRS income year pay return of income 2004 No 35 s EW 15D
EW 15F: Expected value method
When this section applies
1: This section applies when—
a: a person has entered into a financial arrangement in the ordinary course of their business and the person is not in the business of dealing in relation to the financial arrangement; and
b: the financial arrangement is denominated in a currency other than New Zealand dollars or is a derivative instrument; and
c: the financial arrangement is not treated under IFRSs as a hedge of a financial arrangement ( financial arrangement A
i: section EW 15D
ii: the method used for financial arrangement A is or was the fair value method or a method that accounts for gains and losses related to the hedge; and
d: the person and all companies in a group of companies to which the person belongs have chosen to use the expected value method by notifying the Commissioner at the time of filing a return of income. Method chosen
2: The person must use a method that—
a: has the features of an expected value approach described in Determinations G9C and G14B
b: allocates a reasonable amount for each income year of the term of the financial arrangement, having regard to the purposes of the financial arrangements rules under section EW 1(3) Meaning of derivative instrument
3: For the purposes of this section and section EW 15G derivative instrument amount business Commissioner company derivative instrument financial arrangement financial arrangements rules group of companies IFRS notify return of income 2004 No 35 s EW 15E(1), (2)
EW 15G: Modified fair value method
When this section applies
1: This section applies when—
a: a person has entered into a financial arrangement in the ordinary course of their business and the person is not in the business of dealing in relation to the financial arrangement; and
b: the financial arrangement is denominated in a currency other than New Zealand dollars or is a derivative instrument; and
c: the financial arrangement is not treated under IFRSs as a hedge of a financial arrangement ( financial arrangement A
i: section EW 15D
ii: the method used for financial arrangement A is or was the fair value method or a method that accounts for gains and losses related to the hedge; and
d: the person and all companies in a group of companies to which the person belongs have chosen to use the fair value method by notifying the Commissioner at the time of filing a return of income. Method chosen
2: The person must use a method that is the fair value method under IFRSs. However an amount allocated to equity reserves under IFRSs must not be allocated to an income year. amount business Commissioner company derivative instrument fair value method financial arrangement group of companies IFRS notify return of income 2004 No 35 s EW 15E(1), (3)
EW 15H: Mandatory use of some determinations
Required methods
1: Section EW 15C(1)
a: Determination G5C: Mandatory conversion convertible notes:
b: Determination G22: Optional conversion convertible notes denominated in New Zealand dollars convertible at the option of the holder:
c: Determination G22A: Optional convertible notes denominated in New Zealand dollars:
d: Determination G29: Agreements for sale and purchase of property denominated in foreign currency: exchange rate to determine the acquisition price and method for spreading income and expenditure:
e: a method other than those set out in paragraphs (a) to (d)
i: has regard to the purposes of the financial arrangements rules under section EW 1(3)
ii: is for a financial arrangement similar to 1 to which the methods set out in paragraphs (a) to (d)
iii: results in the allocation to each income year of amounts that are not materially different from those that would have been allocated using 1 of the methods set out in paragraphs (a) to (d) Succeeding determinations
2: For the purposes of this section, the determinations set out in subsection (1)(a), (c), and (d) amount financial arrangement financial arrangements rules income year 2004 No 35 s EW 15B(3)
EW 15I: Mandatory use of yield to maturity method for some arrangements
When this section applies
1: This section applies and section EW 15C(1)
a: a person is not required to use a method under section EW 15H
b: the financial arrangement—
i: includes in part an excepted financial arrangement; or
ii: is treated by the person or its issuer, all or in part, as an equity instrument under IFRSs; or
iii: is an agreement for the sale and purchase of property or services. Methods
2: The person must use 1 of the following methods to allocate an amount to an income year if the method is available under its terms for the person to use:
a: the yield to maturity method:
b: Determination G26: Variable rate financial arrangements
c: a determination made by the Commissioner under section 90AC(1)(bb) of the Tax Administration Act 1994
d: a method other than those set out in paragraphs (a) to (c)
i: has regard to the purposes of the financial arrangements rules under section EW 1(3)
ii: is for a financial arrangement similar to 1 to which the methods set out in paragraphs (a) to (c)
iii: results in the allocation to each income year of amounts that are not materially different from those that would have been allocated using 1 of the methods set out in paragraphs (a) to (c) Meaning of equity instrument
3: For the purposes of this section, equity instrument has the same meaning as in NZIAS 32. agreement for the sale and purchase of property or services amount Commissioner equity instrument excepted financial arrangement financial arrangement financial arrangements rules IFRS income year issue 2004 No 35 s EW 15B(4) .
367: Yield to maturity method or alternative
1: In section EW 16(1) method method, if the person is not required to use a method under section EW 15B
2: In section EW 16(2) paragraph (a) method method, if the person is not required to use a method under section EW 15B
3: In section EW 16 IFRS
368: Straight-line method
1: In section EW 17(1)(b) EW 25(1). EW 25(1); and
c: the person is not required to use a method under section EW 15B
2: In section EW 17 IFRS
369: Market valuation method
1: In section EW 18(1)(f) way. way; and
g: the person is not required to use a method under section EW 15B
2: In section EW 18 IFRS
370: Choice among first 3 spreading methods
1: In the heading to section EW 19 first 3 some
2: In section EW 19 A person who A person who is not required to use a method under section EW 15B
3: In section EW 19 IFRS
371: Determination method or alternative
1: In section EW 20(1)(b)(ii) do so. do so; and
c: the person is not required to use a method under section EW 15B
2: After section EW 20(2)(b)
bb: the person is not required to use a method under section EW 15B .
3: In section EW 20 IFRS
372: Financial reporting method
Section EW 21
373: Default method
1: In section EW 22(c) , or a financial reporting method
2: Section EW 22(d)
374: Failure to use method for financial reporting purposes
1: In section EW 23(1) and (2) EW 20(2)(f), and EW 21(e) and EW 20(2)(f)
2: After section EW 23(3) IFRS financial reporting
4: This section is modified by section EZ 32B
3: In section EW 23 IFRS
375: Consistency of use of spreading method
1: After section EW 24(2) IFRS method
2B: Section EW 25B
2: In section EW 24 IFRS
376: New section EW 25B inserted
After section EW 25
EW 25B: Consistency of use of IFRS method
Consistency
1: A person who uses a method for IFRS under section EW 15C
a: the remaining term of the arrangement until section EW 29
b: other financial arrangements that are the same as, or similar to, the arrangement unless a different accounting treatment under IFRSs is used. Exception
2: Despite subsection (1)(a)
a: the new method is available to them to use; and
b: the accounting treatment for the financial arrangement under IFRSs is changed in the same income year in which the method is changed for tax purposes. Spreading method adjustment
3: For the purposes of subsection (2), section EW 26(3), (4), and EW 27 section EW 26(2) section EW 29(13) fair value method financial arrangement IFRS income year 2004 No 35 s EW 25B .
377: Change of spreading method
1: After section EW 26(5) Exception for fair value method
6: Subsection (3) and (4) and section EW 27 section EW 29(13) Meaning of sound commercial reasoncommercial reason
7: In this section, sound commercial reason
a: starting or stopping the use of IFRSs to prepare financial statements:
b: starting to use a method for IFRS under section EW 15B
2: In section EW 26 fair value method financial statements IFRS sound commercial reason
378: When calculation of base price adjustment required
1: After section EW 29(12) Changing from fair value method
13: A party to the financial arrangement who changes from the fair value method to another method must calculate a base price adjustment at the date of the change.
2: In section EW 29 fair value method
379: Base price adjustment formula
1: In section EW 31(7) ignoring non-contingent fees; and ignoring—
a: non-contingent fees, if the relevant method is not the IFRS financial reporting method in section EW 15D
b: non-integral fees, if the relevant method is the IFRS financial reporting method in section EW 15D
2: In section EW 31 IFRS non-integral fee
380: New section EW 46B inserted
After section EW 46
EW 46B: Consideration when party changes from fair value method
When this section applies
1: This section applies when a party to a financial arrangement—
a: changes from the fair value method to another method; and
b: is required under section EW 29(13) Consideration
2: The person is treated as having been paid an amount equal to the market value of the financial arrangement on the date of the change. amount fair value method financial arrangement 2004 No 35 s EW 48B .
381: Meaning of controlled foreign company
In section EX 1(2) 1 of the tests a test
382: Options and similar rights in certain cases
In section EX 11(3)(b) under sections EX 14 to EX 17 10%
383: Associates and 10% threshold
Section EX 15(1)
1: For the purpose of applying the 10% threshold in section EX 14
384: Taxable distribution from non-complying trust
In section EX 19(4) RSCT, RWT,
385: Exemption for ASX-listed Australian companies
1: Section EX 31 Exemption
1: A person's rights in a FIF in an income year are not an attributing interest if—
a: the rights are a share; and
b: the share is not a share that may not, or ordinarily may not, be disposed of unless together with rights in another company; and
c: the FIF is a company that meets the requirements of subsection (2) Australian listed company on approved index
2: The company must—
a: at all times in the year when the person holds a right in the company, be resident in Australia; and
b: at all times in the year when the person holds a right in the company, not be treated as resident in a country other than Australia under an agreement that—
i: is between Australia and that other country; and
ii: would be a double tax agreement if negotiated between New Zealand and that other country; and
c: have shares included in an index that is an approved index under the ASX Market Rules, made under Chapter 7 of the Corporations Act 2001 (Aust)
i: at the beginning of an income year, if subparagraph (ii)
ii: when the person acquires the shares, if the person does not own shares in the company earlier in the year; and
d: at all times in the year when the person holds a right in the company, not be an entity described in schedule 25
e: at all times in the year when the person holds a right in the company, be required under the Income Tax Assessment Act 1997 (Aust) and Income Tax Assessment Act 1936 (Aust)
2: In section EX 31 direct income interest income tax
386: Exemption for Australian unit trusts with 25% turnover
Section EX 32
EX 32: Exemption for Australian unit trusts with adequate turnover or distributions
Exemption
1: A person's rights in a FIF in an income year are not an attributing interest if—
a: the rights are a direct income interest; and
b: the FIF is a unit trust; and
c: at all times in the year when the person holds a right in the unit trust, the unit trust is resident in Australia; and
d: at all times in the year when the person holds a right in the unit trust, the unit trust is not treated as resident in a country other than Australia under an agreement that—
i: is between Australia and that other country; and
ii: would be a double tax agreement if negotiated between New Zealand and that other country; and
e: the unit trust is, at all times in the year, not an entity described in schedule 25
f: at all times in the year when the unit trust makes a distribution to investors, there is an RWT proxy under section 15T of the Tax Administration Act 1994
g: for the trust's accounting year (the trust's year
i: the 25% minimum share turnover test in subsection (2)
ii: the 70% minimum distribution test in subsection (7) 25% minimum turnover test
2: The 25% minimum turnover test requires that, for the trust's year, the amount of total net realised gains calculated under subsection (3) subsection (5) Calculation of total net realised gains
3: The amount of total net realised gains is calculated using the formula— total disposal gain − total cost Definition of items in formula
4: In the formula in subsection (3)
a: total disposal gain
b: total cost Calculation of total net unrealised gains
5: The amount of total net unrealised gains is calculated using the formula— total profitable shares − total cost. Definition of items in formula
6: In the formula in subsection (5)
a: total profitable shares
i: held at the end of the trust's year; and
ii: have a market value greater than or equal to their cost to the unit trust:
b: total cost 70% minimum distribution test
7: The 70% minimum distribution test requires that, for the trust's year, the total amount of distributions by the unit trust during the trust's year must be 70% or more of the total distributable gains for the trust's year calculated under subsection (8) Calculation of total distributable gains
8: The amount of total distributable gains is calculated using the formula— closing equity + distributions − opening equity − contributions. Definition of items in formula
9: In the formula in subsection (8)
a: closing equity
b: distributions
c: opening equity
d: contributions Currency
10: The calculations must be done in the currency of the unit trust's financial accounts. accounting year attributing interest company direct income interest FIF income year resident in Australia resident in New Zealand RWT proxy share unit trust year 2004 No 35 s EX 33D .
387: Venture capital company emigrating to grey list country: 10-year exemption
1: In section EX 36(d) subparagraph (i)
d: the person has held shares in the company at all times after a time when— .
2: Section EX 36(e)(i)
i: carried on business in New Zealand; and .
3: Section EX 36(h)(i) and (ii)
i: incurs in the year, expenditure other than interest of at least $1,000,000 or, if less than $1,000,000, at least 25% of the total expenditure, other than interest, incurred by the company in the year; and
ii: at all times in the year, engages at least 10 fulltime employees or contractors or, if less than 10, at least 25% of the total number engaged by the company.
388: Grey list company owning New Zealand venture capital company: 10-year exemption
1: In section EX 37, paragraph (d)
d: the person has held shares in the grey list company at all times after a time when the shares were not listed on a recognised exchange; and .
2: Section EX 37(e)
e: at all times in the year, the grey list company holds more than 50% of the voting interests in a company (the resident company
i: carried on a business in New Zealand; and
ii: had in New Zealand more than 50% of the resident company's assets; and
iii: had in New Zealand more than 50% of the resident company's employees; and .
3: Section EX 37(g)(i) and (ii)
i: incurs in the year expenditure, other than interest, of at least $1,000,000 or, if less than $1,000,000, at least 25% of the total expenditure, other than interest, incurred by the company in the year:
ii: at all times in the year, engages at least 10 fulltime employees or contractors or, if less than 10, at least 25% of the total number engaged by the company.
389: New section EX 37B inserted
After section EX 37
EX 37B: Share in grey list company acquired under venture investment agreement
A person's rights in a FIF in an income year are not an attributing interest if—
a: the FIF is a grey list company; and
b: the person first acquires a share or option to buy a share in the company—
i: under a venture investment agreement; and
ii: at the same time and on the same terms as an acquisition of an interest in the FIF by the Venture Investment Fund or a company owned by the Venture Investment Fund. attributing interest company FIE grey list company income year share 2004 No 35 s EX 37(4B) .
390: Exemption for employee share purchase scheme of grey list company
In section EX 38, paragraph (g)
g: the share purchase agreement includes a restriction on the disposal of the shares that affects for the income year the value of the benefit to the person under the agreement; and .
391: Terminating exemption for grey list company with numerous New Zealand shareholders
1: Section EX 39(1)
1: A person's rights in a FIF are not an attributing interest if—
a: the rights are a direct income interest; and
b: the FIF is a grey list company; and
c: on 17 May 2006, the company—
i: was a grey list company; and
ii: was not an entity described in schedule 25
iii: had more than 20,000 shareholders who had addresses in New Zealand on the company's share register; and
iv: had shareholders referred to in subparagraph (iii)
v: had assets of which more than 50% in total value were shares in other companies carrying voting interest of more than 50%; and
d: on 17 May 2006, the shares were listed—
i: on a recognised exchange in New Zealand; and
ii: on a recognised exchange in a grey list country.
2: In section EX 39(2) subsection (1)(a) to (f) subsection (1)(b) and (c)
392: Limits on choice of calculation methods
1: Section EX 46(6)(b)
b: the person is the trustee of a trust that—
i: has no gifting settlor who is not a natural person or deceased person; and
ii: at all times in the income year, is a complying trust for a distribution made at the time; and
iii: is, at all times in the income year, mainly for the benefit of a natural person for whom the gifting settlors of the trust have natural love and affection (or had natural love and affection when alive) or is mainly for the benefit of an organisation or trust with income that is exempt income under section CW 41 or CW 42 .
2: Section EX 46(10)(c)
c: an interest in a non-resident holding directly or indirectly assets of which 80% or more by value at a time in the income year—
i: consist of fixed-rate shares, or financial arrangements providing funds to a person; and
ii: are denominated in New Zealand dollars or, under NZIAS 39, are hedged items having a value in New Zealand dollars governed by a hedging instrument that is highly effective: .
3: In section EX 46(11) (10)(d) (10)(a) to (d)
4: After section EX 46(11) Meaning of gifting settlor
12: A gifting settlor relevant trust
a: makes a transfer of value, by disposing of property, to the trustee of—
i: the relevant trust:
ii: a trust with a trustee who settles property on the relevant trust, directly or through the trustees of other trusts; and
b: is not the trustee of a trust.
393: Comparative value method
In section EX 51(4) tax that the person is allowed as a credit under section amount that the person is allowed as a credit under section LE 1
394: Fair dividend rate method: usual method
1: Section EX 52(1)(b)
b: is neither—
i: a unit-valuing fund that is subject to section EX 53
ii: another person that determines the market value of the attributing interest for each period of a day in the income year and that chooses to apply the method in section EX 53
2: In section EX 52(5) that the person holds at the start of the income year. that—
a: the person holds at the start of the income year; and
b: are not, at the beginning of the income year, included in a direct income interest of 10% or more in a grey list company.
3: In section EX 52(11) during the year in acquiring or increasing in acquiring or increasing during the income year
4: In section EX 52(12) cost (interest × average cost)
5: Section EX 52(13)(b)
b: interest
c: average cost
6: After section EX 52(14) Treatment of transaction under section EX 63 or EX 67
14B: For the purposes of subsection (7) section EX 63(5) or EX 67
395: Fair dividend rate method for funds that value investors' units
1: In the heading to section EX 53 funds that value investors' units unit-valuing funds and others by choice
2: In the heading to section EX 53(1) : first case applies
3: After section EX 53(1) When this section applies: second case
1B: This section applies also when a person—
a: calculates FIF income or loss from an attributing interest in a FIF for an income year under the fair dividend rate method; and
b: the person is not subject to subsection (1)
c: the person—
i: determines the market value of the attributing interest for each period of a day (the unit valuation period
ii: chooses that this section applies.
4: In section EX 53(2) fund's total FIF income from its attributing interests total FIF income of the fund or person (the interest holder
5: In section EX 53(5) that the fund holds at the start of the unit valuation period that—
a: the interest holder holds at the start of the unit valuation period; and
b: are not, at the beginning of the income year, included in a direct income interest of 10% or more in a grey list company.
6: In section EX 53(8) fund interest holder
7: In section EX 53(13) the person incurs during the period in acquiring or increasing the interest holder incurs in acquiring or increasing during the period
8: In section EX 53(14) cost (interest × average cost)
9: Section EX 53(15)(a) and (b)
a: gain
b: interest
c: average cost
10: After section 53(16) Deemed transaction under section EX 67 ignored
16B: For the purposes of subsection (9) section EX 67
396: Cost method
1: After section EX 56(3)(a)
ab: the amount that is shown as the net asset value of the interest in audited financial statements of the person for the relevant income year made available to the general public, if—
i: paragraph (a)
ii: the FIF makes available to the general public audited financial statements for its accounting year ending in the relevant income year; and
iii: the person chooses that this paragraph applies; or
ac: the amount of the cost of the interest, if—
i: paragraphs (a) and (ab)
ii: the person acquires the interest in the 2005–06 or 2006–07 income year; or .
2: In section EX 56(3)(b) subparagraph (i) paragraphs (a), (ab) and (ac) if
3: In section EX 56(3)(b)(i) for which the person has FIF income or loss attributing interest
4: In section EX 56(3)(c) paragraphs (a), (ab), (ac), and (b) if
5: In section EX 56(3)(d) paragraphs (a), (ab), (ac), and (b) if
6: In section EX 56(3)(e) paragraphs (a), (ab), (ac), and (b) if
7: In section EX 56(11)(a) during the preceding income year in acquiring or increasing in acquiring or increasing during the preceding income year
8: In section EX 56(18)(a) during the year in acquiring or increasing in acquiring or increasing during the relevant income year
397: Codes: comparative value method, deemed rate of return method, fair dividend rate method, and cost method
Section EX 59(1)(c)
c: the fair dividend rate method, if—
i: the FIF is not a grey list company:
ii: the person does not hold a direct income interest of 10% or more in the FIF at the beginning of the income year of the period: .
398: Limits on changes of method
Section EX 62(8)(a) to (d)
a: has no gifting settlor who is not a natural person or deceased person; and
b: at all times in the income year, is a complying trust for a distribution made at the time; and
c: is—
i: at all times in the income year, mainly for the benefit of a natural person for whom the gifting settlors of the trust have natural love and affection, or had natural love and affection when alive:
ii: mainly for the benefit of an organisation or trust with income that is exempt income under section CW 41 or CW 42
d: is not a superannuation scheme.
399: Consequences of changes in method
After EX 63(4) Changes between comparative value method and fair dividend rate method
5: If a person holding an attributing interest in a FIF changes from either of the comparative value method and the fair dividend rate method to the other of the comparative value method and the fair dividend rate method for calculating the FIF income or loss from the interest, the person is treated as having—
a: disposed of the interest to an unrelated person immediately before the start of the first income year to which the new method applies; and
b: reacquired the interest at the start of the income year; and
c: received for the disposal and paid for the reacquisition an amount equal to the market value of the interest at the time of the disposal.
400: FIF rules first applying to interest on or after 1 April 2007
1: Section EX 67(1) When this section applies
1: This section applies when a person has rights in a FIF that—
a: for the period ending on a day (the preceding day
i: not an attributing interest:
ii: an attributing interest for which the person does not have FIF income or loss:
iii: rights for which the person is a share supplier in a returning share transfer; and
b: for the period beginning on the day (the application day
2: In section EX 67(3)
a: in the words before paragraph (a) the disposal and acquisition referred to in subsection (2) the disposals in an income year, and related acquisitions, treated as occurring under this section
b: in paragraph (a)(i) disposal is disposals are
c: in paragraph (a)(ii) disposal is disposals are
d: in paragraph (a)(iii) disposal is disposals are
e: in paragraph (b) disposal disposals
401: Measurement of cost
Section EX 68(2) and (3) FIFO cost flow identification
2: If sections EX 52(14) and EX 53(16) FIFO
402: Policyholder income formula
1: Section EY 43(1) Formula
1: The policyholder income formula
2: After section EY 42(5) FDR adjustment
5B: FDR adjustment section EY 43B PILF adjustment
5C: PILF adjustment section EY 43C
403: New sections EY 43B and EY 43C inserted
After section EY 43
EY 43B: Policyholder income formula: FDR adjustment
What this section applies to
1: This section applies for the purposes of section EY 43(5B)
a: property is an attributing interest in a FIF held by a life insurer or by a portfolio tax rate entity that the life insurer has invested in, directly or indirectly; and
b: the life insurer or the portfolio tax rate entity uses the fair dividend rate method for the property; and
c: section EY 43C When has life insurer indirectly invested in portfolio tax rate entity?
2: For the purposes of subsection (1) PTRE A FDR adjustment
3: In using the policyholder income formula, the life insurer may calculate the item FDR adjustment
a: using the formula in subsection (5)
b: by calculating, using a reasonable method for the information available to the life insurer, the amount credited to actuarial reserves in relation to the property, but excluding amounts that are related to FIF income under the fair dividend rate method. Consistency requirement
4: (4) In using the policyholder income formula, the life insurer must calculate the item FDR adjustment subsection (3)(a) or (b) Formula
5: The formula referred to in subsection (3)(a) 0.6 × (FIF result − FDR income). Definition of items in formula
6: The items in the formula are defined in subsections (7) and (8) FIF result
7: FIF result FDR income
8: FDR income amount attributing interest fair dividend rate method FIF FIF income FIF loss income portfolio investment-linked life fund 2004 No 35 s EY 42B
EY 43C: Policyholder income formula: PILF adjustment
What this section applies to
1: This section applies for the purposes of section EY 42(5C)
a: an attributing interest in a FIF,—
i: held by the life insurer or a portfolio tax rate entity that the life insurer has invested in directly or indirectly; and
ii: for which the life insurer or portfolio tax rate entity uses the fair dividend rate method for the property:
b: shares described in section CX 55 When has life insurer indirectly invested in portfolio tax rate entity?
2: For the purposes of subsection (1) PTRE A PIE adjustment
3: In using the policyholder income fotniula, the life insurer may calculate the item PILF adjustment
a: using the formula in subsection (5)
b: by calculating, using a reasonable method for the information available to the life insurer, the amount credited to actuarial reserves in relation to the property, but excluding amounts that are—
i: related to FIF income under the fair dividend rate method:
ii: dividends or distributions for shares described in subsection (1)(b) section CX 56(2) Consistency requirement
4: In using the policyholder income formula, the life insurer must calculate the item PILE adjustment subsection (3)(a) or (b) Formula
5: In using the policyholder income formula, the life insurer must calculate the item PILF adjustment 0.9 × (FIF result − FDR income) + 0.9 × excluded shares. Definition of items in formula
6: The items in the fonnula are defined in subsections (7) to (9) FIF result
7: FIF result subsection (1)(a) FDR income
8: FDR income subsection (1)(a) Excluded shares
9: Excluded shares subsection (1)(b)
a: the positive amount of income excluded by section CX 55(2)
b: the negative amount of a deduction not allowed by section DB 23(3)(b)
c: the gains and losses for the shares, calculated using accepted accounting practice, but excluding—
i: amounts already accounted for under paragraphs (a) and (b) subsection (7)
ii: dividends and distributions for the shares, other than distributions from a portfolio tax rate entity to which section CX 56(2) amount attributing interest deduction dividend excluded income fair dividend rate method FIF FIF income FIF loss income portfolio investment-linked life fund share 2004 No 35 s EY 42C .
404: Terminating exemption for grey list FIF investing in Australasian listed equities
1: Section EZ 32(1)
1: A person's rights in a FIF are not an attributing interest if—
a: the rights are a direct income interest (the shares
b: on 17 May 2006, the company—
i: was a grey list company; and
ii: was not an entity described in schedule 25
iii: had shareholders of which more than 40% had addresses in New Zealand on the company's share register; and
iv: had shareholders referred to in subparagraph (iii)
v: had assets of which more than 50% in total value were shares in other companies that were resident in New Zealand or Australia and were listed on a recognised exchange in New Zealand or Australia; and
c: on 17 May 2006, the shares were listed —
i: on a recognised exchange in New Zealand; and
ii: on a recognised exchange in a grey list country.
2: In section EZ 32(3) subsection (1)(b) to (g) subsection (1)(b) and (c)
405: New section EZ 32B inserted
After section EZ 32
EZ 32B: Transitional rule for IFRS reporting
When this section applies
1: (1) This section applies for an income year before the 2007–08 income year when—
a: a person who is a party to a financial arrangement starts to use a spreading method in section EW 16, EW 18, or EW 20
b: the person is not required to use a method under section EW 15B
c: as a result of adopting IFRSs, the method chosen does not comply with sections EW 16(2)(d), EW 18(f), and EW 20(2)(f) Treatment
2: For the purposes of the financial arrangements rules, the person is treated as complying with the relevant section. financial arrangement financial arrangements rules IFRS income year 2004 No 35 s EZ 50 .
406: Consecutive or successive finance leases
Section FA 11
FA 11: Adjustments for leases that become finance leases
When this section applies
1: This section applies when a lease is entered into on or after 20 May 1999 and—
a: the lease is a consecutive or a successive lease—
i: that is treated as 1 lease under the definition of lease
ii: with a term of the lease that the lessor and lessee do not contemplate, at the start of the term, will be more than 75% of the personal property lease asset's estimated useful life; and
iii: with a term of the lease that is more than 75% of the asset's estimated useful life:
b: the lease is an operating lease that becomes a finance lease under paragraph (c) finance lease Adjustment required
2: The lessor and lessee must each adjust their income and expenditure calculated for the lease by including an adjustment in a return of income for the tax year corresponding to the income year in which the lease becomes a finance lease. Amount of adjustment
3: The amount of the adjustment is calculated for the relevant person in relation to the period described in subsection (5) finance income − finance expenditure − unadjusted income + unadjusted expenditure. Definition of items in formula
4: In the formula,—
a: finance income
b: finance expenditure
c: unadjusted income
d: unadjusted expenditure Adjustment period
5: The period starts on the date on which the lease starts and ends on the last day of the income year in which the lease becomes a finance lease. Adjustment positive
6: If the adjustment is positive, the amount is income of the relevant person under section CH 6 Adjustment negative
7: If the adjustment is negative, the amount is a deduction of the relevant person under section DB 51B amount estimated useful life finance lease income income year lease lessee lessor operating lease personal property lease asset return of income tax year term of the lease 2004 No 35 s FC 8H
FA 11B: Adjustments for certain operating leases
When this section applies
1: This section applies when a lease is an operating lease that—
a: is entered into on or after 20 May 1999 and before 20 June 2007; and
b: is an arrangement, or part of an arrangement that, on 20 June 2007, meets the requirements of paragraph (c)(i) to (iii) finance lease
c: has a term of the lease ending after the end of the income year in which 20 June 2007 falls (the adjustment year
d: does not meet the requirements of section FA 11(1) Adjustment required
2: The lessor must adjust their income and expenditure calculated for the lease asset by including an adjustment in a return of income for the tax year corresponding to the income year after the adjustment year. Amount of adjustment
3: The amount of the adjustment is calculated using the formula— Definition of item in formula
4: In the formula, total depreciation losses Income
5: The amount of the adjustment is income of the lessor under the lease under section CH 6 Adjusted tax value
6: The adjusted tax value of the lease asset at the beginning of the income year after the adjustment year is the total of the amount of the adjustment and the adjusted tax value that the lease asset would have in the absence of this section. Depreciation loss
7: For an income year beginning after 20 June 2007 in which the lease is an operating lease, the amount of depreciation loss allowed for the lease asset other than under section EE 48 adjusted tax value amount arrangement deduction depreciation loss finance lease income income year lease lessee lessor operating lease return of income tax year term of the lease 2004 No 35 s FC 8I .
407: Attribution rule for income from personal services
1: After section GB 27(3) Treatment of certain dividends
4: If a company that is required to attribute an amount to the working person under this section pays a dividend, sections HA 14 to HA 19
a: has no net income for the tax year in which it pays the dividend other than income attributed under this section, ignoring interest income that is incidental to the company's business; and
b: is not a qualifying company; and
c: chooses to have the dividend treated as if it were paid by a qualifying company.
2: In section GB 27 amount business company dividend qualifying company
3: In section GB 27 , GC 14EB
408: Arrangements involving family support credits
1: The heading before section GB 44 Arrangements involving tax credits for families
2: In the heading to section GB 44 family support credits tax credits for families
409: Fully imputed distributions
1: In section HA 15(3)(c) for the income year of the shareholder in which the dividend is derived at the time the shareholder derives the dividend, modified as applicable by section OZ 14
2: In section HA 15(4)(a) modified as applicable by section OZ 14 ratios)
3: In section HA 15(5)(a) modified as applicable by section OZ 14 subsection (4)
410: Scheme of subpart
1: Section HL 2(2) Election to be type of portfolio investment entity
2: An entity may choose under section HL 11
a: portfolio tax rate entity if the entity is—
i: a company, superannuation fund, or group investment fund; and
ii: eligible under section HL 3(1)
b: portfolio listed company if the entity is—
i: a company listed on a recognised exchange in New Zealand; and
ii: eligible under section HL 3(3)
c: portfolio defined benefit fund if the entity is—
i: a defined benefit fund; and
ii: eligible under section HL 3(5)
d: portfolio investment-linked life fund if the entity is—
i: a separate identifiable fund, forming part of a life insurer, holding investments subject to life insurance policies under which benefits are directly linked to the value of the investments held in the fund; and
ii: eligible under section HL 3(7)
2: In section HL 2(7)(c)(ii) period. period:
d: the amount of fees paid to the entity by the investor on the day:
e: the amount of rebates of fees credited to the investor by the entity on the day:
f: the amount of expenditure, for the income year ending with the day, transferred under subpart DV (Expenditure specific to certain entities) to the entity by the investor.
411: Section HL 3 replaced
Section HL 3
HL 3: Eligibility requirements for entities
Eligibility requirements for entity electing to be portfolio tax rate entity
1: An entity that is choosing under section HL 11 subsections (9), (10), and (11) Eligibility requirements for portfolio tax rate entity
2: (2) A portfolio tax rate entity must meet—
a: the eligibility requirements described in subsections (9), (10), and (11)
b: the further eligibility requirements described in sections HL 5C, HL 6, HL 7, HL 9, and HL 10 Eligibility requirements for entity electing to be portfolio listed company
3: An entity that is choosing under section HL 11 subsections (9), (10), and (11) Eligibility requirements for portfolio listed company
4: A portfolio listed company must meet—
a: the eligibility requirements described in subsections (9), (10), and (11)
b: the further eligibility requirements described in sections HL 5C, HL 6, HL 8, HL 9, and HL 10 Eligibility requirements for entity electing to be portfolio defined benefit fund
5: An entity that is choosing under section HL 11 subsections (9), (10), and (11) Eligibility requirements for portfolio defined benefit fund
6: A portfolio defined benefit fund must meet—
a: the eligibility requirements described in subsections (9), (10), and (11)
b: the further eligibility requirements described in sections HL 5C, HL 6, HL 9, and HL 10 Eligibility requirements for separate identifiable fund electing to be portfolio investment-linked life fund
7: An entity that is choosing under section HL 11 subsections (10) and (11) Eligibility requirements for portfolio investment-linked life fund
8: A portfolio investment-linked life fund must meet—
a: the eligibility requirements described in subsections (10) and (11)
b: the further eligibility requirements described in sections HL 6, HL 9, and HL 10 Business requirement
9: The business requirement is that the entity must not carry on a business of life insurance. Residence requirement
10: The residence requirement is that the entity must be—
a: resident in New Zealand; and
b: not treated under a double tax agreement as not being resident in New Zealand. Entity history requirement
11: The entity history requirement is that the entity must not, before the day on which the election to be a portfolio investment entity is to be effective, have ceased to be a portfolio investment entity under section HL 14(1) company double tax agreement group investment fund life insurance portfolio defined benefit fund portfolio investment entity portfolio investment-linked life fund portfolio listed company portfolio tax rate entity resident in New Zealand superannuation fund 2004 No 35 s HL 3 .
412: Effect of failure to meet eligibility requirements for entities
In section HL 4(2)(a) subparagraph (i)
a: a portfolio investor class of the entity fails to meet a requirement of section HL 6 or HL 9 section HL 10 .
413: New sections HL 5B and HL 5C inserted
After section HL 5
HL 5B: Meaning of investor and portfolio investor class
Meaning of investor
1: An investor entity
a: if the entity is a company and paragraph (d)
b: if the entity is not a company and paragraphs (c) and (d)
i: by reason of the rules of the entity or the terms of the trust under which the entity is established; and
ii: as if the entity were a company and the person were a shareholder in the company:
c: if the entity is a portfolio investment-linked life fund and paragraph (d)
d: for a share, entitlement, or life insurance policy held through a portfolio investor proxy by a person, the portfolio investor proxy. Meaning of portfolio investor class
2: A portfolio investor class
a: the portfolio entity investments are the same for all the investors in the group; and
b: each investor's interest in a portfolio entity investment represents a proportion ( the investment proportion
c: the investment proportion for each investor and each portfolio entity investment differs from the average value of the investment proportion, for the investors in the group and the portfolio entity investment, by less than 2.5% of that average value except if subsection (3) Exception to requirement of subsection (2)(c)
3: The investment proportion for an investor in a group referred to in subsection (2)
a: the portfolio entity investment is an arrangement under which the entity is assured of receiving, from investments, sufficient proceeds for the entity to repay each investor in the group an amount contributed to the entity; and
b: the excess in difference between the investment proportion for the investor and the average value for the group arises from differences between the portfolio investor rates of members of the group. investor portfolio entity investment portfolio investment entity portfolio investor class portfolio investor interest 2004 No 35 s HL 5B
HL 5C: Income interest requirement
What this section applies to
1: This section applies to a portfolio investment entity that is not a portfolio investment-linked life fund. Requirement
2: The income interest requirement is that all portfolio investor interests in the entity that give rights in relation to proceeds from a portfolio entity investment give the rights in relation to all the proceeds from the investment that are not category B income. category B income portfolio entity investment portfolio investment entity portfolio investment-linked life fund portfolio investor interest 2004 No 35 s HL 5C .
414: Investor membership requirement
1: Before section HL 6(1) General investor membership requirement
1A: The investor membership requirement for an entity that is not a company listed on a recognised exchange in New Zealand and does not meet the requirements of subsection (3) subsection (1)
2: In section HL 6(1)
a: the heading is replaced by Investor membership requirement for portfolio investor class
b: the words before paragraph (a) The investor membership requirement for a portfolio investor class is that the class must include—
c: in paragraph (j)(iii) entity. entity:
k: Auckland Regional Holdings.
3: In section HL 6(3) paragraph (a) There is no investor membership requirement for a portfolio investor class that,—
4: In section HL 6(3)(c) 1956. 1956:
d: is a superannuation fund that—
i: existed before 17 May 2006; and
ii: on or after 17 May 2006, if treated as a unit trust, would have met the requirements of 1 or more of paragraphs (a) and (c) to (e) public unit trust
iii: has no investor, other than the fund's manager or trustee, that can control the investment decisions relating to that class.
5: Section HL 6(4)(c)
c: the investor has a portfolio investor interest fraction of 5% or more; and
d: the associated person has a portfolio investor interest fraction of 5% or more.
415: Investor return adjustment requirement: portfolio tax rate entity
Section HL 7(3)
3: An adjustment reflecting the effect of the investor's portfolio investor rate must be made to—
a: the investor's portfolio investor interest in the portfolio investor class or another portfolio investor class—
i: before the end of the second month after the portfolio calculation period, if the entity has made an election under section HL 22
ii: before the end of the third month after the end of the income year, if the entity has made an election under section HL 23
iii: before the end of the second month after the end of the tax year, if the entity has made an election under section HL 24
b: the amount of each distribution to the investor as a member of the portfolio investor class or another portfolio investor class:
c: the amount of each payment required from the investor as a member of the portfolio investor class towards satisfying the entity's portfolio entity tax liability.
416: Imputation credit distribution requirement: portfolio listed company
1: Section HL 8(1) What this section applies to
1: This section applies to a portfolio investment entity that—
a: is an imputation credit account company; and
b: is not a portfolio investment-linked life fund.
2: In section HL 8 portfolio investment-linked life fund
417: Investor interest size requirement
1: In section HL 9(2) paragraph (a) There is no investor interest size requirement for an investor in a portfolio investor class that,—
2: In section HL 9(2)(c) 1956. 1956:
d: is a superannuation fund that—
i: existed before 17 May 2006; and
ii: on or after 17 May 2006, if treated as a unit trust, would have met the requirements of 1 or more of paragraphs (a) and (c) to (e) public unit trust
iii: has no investor, other than the fund's manager or trustee, that can control the investment decisions relating to that class.
3: In section HL 9(4)(i) subsection (5) subsection (5)
j: Auckland Regional Holdings.
4: Section HL 9(6)(c)
c: the investor has a portfolio investor interest fraction of 5% or more; and
d: the associated person has a portfolio investor interest fraction of 5% or more.
418: Further eligibility requirements relating to investments
1: In section HL 10(1) paragraph (a) The investment type requirement is that 90% or more by value of the entity's assets must be—
2: In section HL 10(2)
a: after paragraph (b)(i)
ib: replacement payments: :
b: paragraph (b)(iii)
iii: income under a lease of land: :
c: in paragraph (b)(iv) referred to in subsection (1)(a) to (d) property
3: In section HL 10(4) paragraph (a) The requirements of subsection (3)(a) and (b)
419: Election to become portfolio investment entity and cancellation of election
1: After section HL 11(2) Exception to when election effective: certain elections relating to portfolio investment-linked life funds
2B: Despite subsection (2)
a: the election is in relation to an electing entity choosing to be a portfolio investment-linked life fund; and
b: the date of receipt is before 1 April 2008; and
c: 1 October 2007 is nominated in the notice.
2: In section HL 11 portfolio investment-linked life fund
420: Unlisted company choosing to become portfolio listed company
1: Section HL 12(1)(a)
a: has 100 shareholders; and .
2: In section HL 12 shareholder
421: Becoming portfolio investment entity
1: In section HL 13(3)(a) subparagraph (i)
a: transferring to another person all shares held by the entity, or for which the entity is a share lender in a returning share transfer, that— .
2: After section HL 13(3) Refund of FDP made before election
3B: If an FDPA company becomes a portfolio investment entity on a day in a tax year other than the end of the tax year, the balance of the company's FDP account at the end of the tax year for the purposes of section RM 21(2)(c)
422: Tax consequences from transition
1: Section HL 14(1) When subsection (1B)
1: Subsection (1B) No penalty or interest arising from transition
1B: The entity is not liable to pay any penalty or interest for which the entity would otherwise be liable for an inaccuracy, arising from the increased liability for provisional tax, in—
a: an estimate of provisional tax made before the entity chooses to become a portfolio investment entity:
b: a payment of provisional tax due before the end of the 2-month period beginning after the entity becomes a portfolio investment entity.
2: In section HL 14 pay
423: Treatment of income from interest when entitlement conditional or lacking
Section HL 17(2)(e)
e: for an entity that exists on 17 May 2006, the vesting period does not exceed the longest vesting period allowed by the entity on 17 May 2006 for an interest created on that date; and
f: for an entity that does not exist on 17 May 2006,—
i: the portfolio investor interest is transferred to the entity by a superannuation scheme that exists on 17 May 2006 and without significant change to the portfolio investor interest; or
ii: the vesting period does not exceed 5 years, if subparagraph (i)
424: Portfolio entity tax liability and tax credits of portfolio tax rate entity for period
1: In section HL 21(4) fees expenses
2: Section HL 21(11) Expenses
11: Expenses
a: fees for ongoing management and administration services paid from or charged to the account of the investor as a member of the portfolio investor class:
b: expenditure of the investor transferred under subpart DV (Expenditure specific to certain entities) to the entity.
425: Payments of tax by portfolio tax rate entity making no election
1: After section HL 22(2) Income tax liability
2B: The income tax liability of the entity for a tax year is equal to the total portfolio entity tax liability of the entity for the portfolio calculation periods in the tax year.
2: In section HL 22(3)(a) for the tax year income tax
426: Payments of tax by portfolio tax rate entity choosing to make payments when investor leaves
1: After section HL 24(1) Income tax liability
1B: The income tax liability of the entity for a tax year is equal to the total portfolio entity tax liability of the entity for the portfolio calculation periods in the tax year.
2: In section HL 24(2)(a) for the tax year income tax
3: Section HL 24(2)(b)
b: by the day that is—
i: the end of the month beginning from the end of the month in which the portfolio investor exit period ends, if subparagraph (ii)
ii: the 15 January following the end of the portfolio investor exit period, if the portfolio investor exit period ends in November.
427: Optional payments of tax by portfolio tax rate entities
1: In section HL 25(1) their portfolio investor interest in the entity the portfolio investor interest for which the investor is a member of a portfolio investor class of the entity
2: Section HL 25(3) Time of optional payment
3: A payment under this section must be made by—
a: the end of the month beginning from the end of the month in which the portfolio calculation period ends, if paragraph (b)
b: the 15 January following the end of the portfolio calculation period, if the portfolio calculation period ends in November.
428: Portfolio investor allocated income and portfolio investor allocated loss
1: In section HL 26(5) fees expenses
2: Section HL 26(6)(e)
e: expenses
i: fees for ongoing management and administration services paid from or charged to the account of the investor as a member of the portfolio investor class:
ii: expenditure of the investor incurred in the investor's income year ending with the day and transferred under subpart DV (Expenditure specific to certain entities) to the entity: .
429: Treatment of portfolio investor allocated loss for zero-rated portfolio investors and investors with portfolio investor exit period
1: In section HL 27(2) income year corresponding to the tax year income year including the end of the portfolio tax rate entity's income year
2: In section HL 27
a: portfolio allocation period portfolio investor allocated income
b: income tax portfolio tax rate entity
430: Credits received by portfolio tax rate entity or portfolio investor proxy
1: Section HL 29(6) Application of subsections (7) to (11)
6: For an investor in a portfolio tax rate entity who is allocated under subsection (3)
a: subsections (7) and (8)
i: the investor is a zero-rated portfolio investor:
ii: the investor is not a zero-rated portfolio investor and the entity makes payments of tax under section HL 21
b: subsections (10) and (11)
a: does not apply.
2: Section HL 29(7) Zero-rated portfolio investors and certain investors having portfolio investor exit period: credit
7: The investor is treated as receiving for the allocated credits, for the tax year corresponding to the investor's income year,—
a: a credit against income tax payable by the investor of the amount given by subsection (8)
i: the credits are under subpart LJ (Tax credits for foreign income tax); and
ii: the investor is not a portfolio tax rate entity or portfolio investor proxy; or
b: the allocated amount of each type of credit if—
i: the credits are not under subpart LJ:
ii: the investor is a portfolio tax rate entity or portfolio investor proxy.
3: In section HL 29(8) Amount of credit for foreign tax: zero-rated portfolio investors, other than portfolio tax rate entities and portfolio investor proxies, and investors having portfolio investor exit period
4: Section HL 29(9)
5: In section HL 29(11)(a)(ii) section HL 23 or HL 24 section HL 24
6: Section HL 29(11)(b)
b: the investor as a member of—
i: the portfolio investor class:
ii: another portfolio investor class, if the entity chooses such a use for the credit.
7: In section HL 29(13)(a)(ii)
a: in subsection (11)(b) in subsection (12)(b)
b: by subsection (11) by subsection (12)
431: Portfolio investor proxies
In section HL 33(3)(d) or the payments required from the investor, distributions to the investor,
432: Common ownership: group of companies
1: After section IC 3(2) When portfolio tax rate entities included in group
2B: In relation to 2 or more companies of which 1 is a portfolio tax rate entity, the companies are treated as a group of companies at a particular time or for a particular period if—
a: the portfolio tax rate entity owns 100% of the voting interests in the other companies; and
b: the other companies in the group are portfolio land companies.
2: In section IC 3 portfolio land company
433: Remaining refundable credits: PAYE, RWT, and certain other items
1: After section LA 6(1)(c)
cb: section LB 6 .
2: After section LA 6(1)(d)
db: subpart LH (Tax credits for expenditure on research and development), although modified by section LH 2(6) .
3: In section LA 6 LD 12(5), LH 1(6),
434: Remaining refundable credits: family scheme income
1: The heading to section LA 7 Remaining refundable credits: tax credits for families
2: In section LA 7(1) family scheme income families
435: Use of tax credits
In section LA 9 Section OZ 11 extends.
436: Heading: subpart LB
The heading to subpart LB Subpart LB—Tax credits for payments, deductions, and family payments
437: Tax credits for family scheme income
1: The heading to section LB 4 Tax credits for families
2: In section LB 4
a: family assistance credit tax credit
b: (Family assistance credit) (Abating WFF tax credits)
c: family tax credit minimum family tax credit
d: (Family tax credit) (Minimum family tax credit)
3: In section LB 4
a: minimum family tax credit
b: family assistance credit family tax credit
438: Tax credits for caregivers
1: Section LB 6
LB 6: Tax credits for RSCT
When this section applies
1: This section applies when—
a: a person derives income as a retirement scheme contribution in an income year; and
b: the retirement scheme contributor pays RSCT for the contribution; and
c: the income is not excluded income of the person under section CX 50B Tax credit: New Zealand resident
2: If the person is resident in New Zealand, they have a tax credit for the tax year corresponding to the income year of an amount equal to the RSCT withheld. Tax credit: non-resident
3: If the person is not resident in New Zealand, they have a tax credit for the tax year corresponding to the income year of an amount equal to the excess of RSCT withheld over NRWT paid in relation to the contribution. When contribution is taxable Maori authority distribution
4: If the person is not resident in New Zealand and the retirement scheme contribution is a taxable Maori authority distribution, they have a tax credit for the tax year corresponding to the income year of an amount equal to the RSCT withheld. amount excluded income income income year non-resident NRWT pay resident in New Zealand retirement scheme contribution retirement scheme contributor RSCT tax credit tax year 2004 No 35 s LD 12(1) .
2: After section LB 6
LB 7: Tax credits related to personal service rehabilitation payments: providers
When this section applies
1: This section applies when—
a: a person—
i: is paid under the Injury Prevention, Rehabilitation, and Compensation Act 2001 personal service rehabilitation payment
ii: pays another person (a provider
b: the Accident Compensation Corporation pays a provider a personal service rehabilitation payment for a period for providing a key aspect of social rehabilitation to the person. Tax credit
2: The provider has a tax credit for the tax year corresponding to the income year in which the period falls. Amount
3: The amount of the tax credit is calculated using the formula— Definition of items in formula
4: In the formula,—
a: amount paid
b: tax rate schedule 4 clause 1 amount amount of tax income year pay personal service rehabilitation payment tax credit tax year 2004 No 35 s LD 1B
LB 8: Tax credits related to personal service rehabilitation payments: payers
When this section applies
1: This section applies when—
a: a person is paid under the Injury Prevention, Rehabilitation, and Compensation Act 2001 personal service rehabilitation payment
b: the person pays another person (the provider
c: the amount paid to the provider is less than the amount of the personal service rehabilitation payment to the person for the period after taking into account any amount of tax withheld. Tax credit
2: The person has a tax credit for the tax year corresponding to the income year in which the period falls to the extent of the amount calculated using the formula— Definition of items in formula
3: In the formula,—
a: total tax withheld
b: amount paid
c: tax rate schedule 4 clause 1 amount amount of tax income year pay personal service rehabilitation payment tax credit tax year 2004 No 35 s LD 1C .
439: Tax credits for housekeeping
In section LC 6(4) family scheme income tax credits for families
440: Tax credits for charitable and other public benefit gifts
1: Section LD 1(1)
1: A person who makes a charitable or other public benefit gift in a tax year and who meets the requirements of section 41A of the Tax Administration Act 1994 subsection (2)
2: In section LD 1(2) subsection (1)(b) subsection (1)
3: In section LD 1(5) family scheme income tax credits for families
441: Tax credits for imputation credits
1: After section LE 1(4) FIF income
4B: For the purposes of this section, an amount that would, in the absence of section EX 59
2: In section LE 1 attributing interest FIF income
442: New section LE 7B
After section LE 7
LE 7B: Credit of RSCT for imputation credit
Retirement scheme contributions
1: A retirement scheme contributor who attaches an imputation credit to a retirement scheme contribution for a person in an income year has a tax credit for the corresponding tax year of an amount equal to the lesser of—
a: the amount of the imputation credit:
b: the liability of the contributor for RSCT on the contribution. When credit more than liability
2: If the amount of the imputation credit is more than the liability of the contributor for RSCT on the contribution,—
a: the amount of the excess is treated as an imputation credit attached to a distribution from the contributor to the person; and
b: the person responsible for withholding the RSCT must, within 30 days of the contribution, notify the person of the amount of the excess credit. amount imputation credit income year notify retirement scheme contribution retirement scheme contributor RSCT tax credit tax year 2004 No 35 s LB 3 .
443: Application of imputation ratio
In section LE 8(1) Section OZ 10 ratios).
444: Application of combined imputation and FDP ratio
After section LE 9(2) Relationship with section OZ 10
3: Section OZ 10
445: Tax credits for FDP credits
In section LF 1(1) Section OZ 11 income year.
446: Application of FDP ratio
In section LF 6(1) Section OZ 10 ratios).
447: Application of combined imputation and FDP ratio
After section LF 7(2) Relationship with section OZ 10
3: Section OZ 10
448: New subpart LH inserted
After subpart LF
LH: Tax credits for expenditure on research and development
LH 1: Who this subpart applies to
Persons included
1: This subpart provides for a tax credit for eligible expenditure on research and development activities incurred by a person who—
a: carries on a business in New Zealand as a resident or through a fixed establishment in New Zealand:
b: is an industry research co-operative. Persons excluded
2: Subsection (1)
a: a person who is a Crown Research Institute, a tertiary institution, or a district health board:
b: a person associated with an entity referred to in paragraph (a)
c: a person controlled by 1 or more of the entities referred to in paragraph (a) or (b) associated person business control Crown Research Institute district health board fixed establishment industry research co-operative New Zealand research and development activities resident tax credit tertiary institution 2004 No 35 s LH 2(1)
LH 2: Tax credits relating to expenditure on research and development
When this section applies
1: This section applies when—
a: a person to whom section LH 1(1) section LH 3
b: the income year is the 2008–09 income year or a later income year; and
c: the person incurs in the income year or period an amount of expenditure or depreciation loss on research and development activities that—
i: meets the requirements of subsection (3)
ii: is an amount related to research and development activities performed on their own behalf and not on behalf of another person; and
d: the person meets the requirements of section 68D or 68E of the Tax Administration Act 1994 Tax credit
2: The person has a tax credit for the tax year corresponding to the income year calculated under section LH 4 Minimum requirements for expenditure
3: For the purposes of this subpart, the eligible expenditure referred to in section LH 4
a: of $20,000 or more, or the part-year equivalent amount calculated under subsection (4)
b: paid under an agreement between the person ( person A Part-year calculations
4: For the purposes of subsection (3)(a) section LH 1 When expenditure treated as incurred in income year
5: In subsections (1)(c) and (3) and sections LH 3(1)(e) and LH 5(2)
a: the opening value of trading stock in the income year under section DB 49
b: an unexpired amount of expenditure in the income year under section DB 50
c: an unpaid amount of expenditure on employment income in the income year under section DB 51
d: an amount of overseas eligible expenditure under section LH 6(5) Dealing with remaining tax credits: relationship with sections LA 5 and LA 6
6: If the person has a tax credit under this section remaining for the tax year under section LA 5(5) section LA 6(2) subsection (2)(c)
cb: pay an amount that is payable by the person under an Inland Revenue Act. amount associated person depreciation loss employment income income year Inland Revenue Acts listed research provider overseas eligible expenditure pay research and development activities tax credit tax year trading stock 2004 No 35 ss LH 1(1), (5), (7)(d), LH 3(4)
LH 3: Requirements
What is required of person?
1: For the purposes of section LH 2
a: perform on their own behalf, or have another person perform, research and development activities related to—
i: the business referred to in section LH 1(1)(a)
ii: for an industry research co-operative, the business of a person who is an industry member under section LH 16
b: control the research and development activities; and
c: bear the financial risk of the research and development activities; and
d: effectively own the results of the research and development activities, if any; and
e: have—
i: incurred expenditure described in schedule 21 schedule 21
ii: an amount of depreciation loss described in schedule 21 schedule 21 What is excluded
2: For the purposes of section LH 2 section LH 1(2) Partners in partnerships
3: If 2 or more persons perform research and development activities as partners in a partnership, a partner is treated as—
a: meeting the business requirements of subsection (1)(a)(i) and section LH 1(1)(a) section LH 2(3)
b: meeting the control and ownership requirements of subsection (1)(b) to (d) and section LH 6(4)(a) and (d)
i: the partnership, treated as an entity performing the research and development activities, would meet those requirements; and
ii: each partner meets the requirements of section LH 1 Joint ventures
4: If 2 or more persons perform research and development activities as partners in a joint venture, a partner is treated as meeting the control and ownership requirements of subsection (1)(b) to (d) and section LH 6(4)(a) and (d) Activities performed on person's behalf
5: In subsections (3) and (4) amount business capital limitation corresponding income year deduction depreciable property depreciation loss exempt income income year industry research co-operative research and development activities tax year 2004 No 35 s LH 2(2)
LH 4: Calculation of amount of credit
Formula
1: The amount of a tax credit under section LH 2(2) 0.15 × eligible expenditure. Definition of item in formula
2: Eligible expenditure section LH 3(1)(e) sections LH 5 and LH 6 amount depreciation loss income year tax credit 2004 No 35 s LH 4
LH 5: Adjustments to eligible expenditure
Cases when adjustment may apply
1: An amount of eligible expenditure under section LH 4 subsections (2), (4), (5), and (6) Treatment of prepayments and other timed amounts
2: If an amount of expenditure or depreciation loss is incurred in an income year and subpart CH (Adjustments) applies, or would apply, to the expenditure or depreciation loss, the amount of eligible expenditure is adjusted in the same way. Trading stock and livestock
3: Despite subsection (2) section CH 1
a: the expenditure or amount of depreciation loss is incurred in acquiring or producing an item that has a market value and that has been subjected to a process or transformation as part of the research and development activities; and
b: schedule 21 clause 8 Capital expenditure
4: The requirements of section LH 3(1)(e) schedule 21 schedule 21
a: the capital limitation applies to the amount; and
b: the amount is not a deduction under section DB 34
c: the expenditure is incurred by the person in the intended development of depreciable property that is—
i: intangible property:
ii: tangible property not intended for use other than in the research and development activities. Deferred expenditure
5: If a deduction for an amount of expenditure or depreciation loss incurred in an income year is allocated under section EJ 23 Internal software development
6: If the expenditure or amount of depreciation loss relates to internal software development, the amount of eligible expenditure is adjusted under sections LH 9 to LH 13 amount capital limitation deduction depreciable property depreciation loss exempt income income income year internal software development New Zealand research and development activities trading stock 2004 No 35 s LH 3
LH 6: Research and development activities outside New Zealand
Expenditure not part of research and development project
1: If a person incurs expenditure or an amount of depreciation loss in research and development activities performed outside New Zealand other than as part of a research and development project, the expenditure or amount is excluded from the calculation of eligible expenditure under section LH 4 Overseas expenditure on research and development project
2: If a person incurs expenditure or an amount of depreciation loss in research and development activities performed outside New Zealand as part of a research and development project, the expenditure or amount is excluded from the calculation of eligible expenditure under section LH 4 Activities performed on person's behalf
3: In subsections (1) and (2) Meaning of research and development project
4: A research and development project
a: consisting of co-ordinated research and development activities controlled by the person; and
b: having start and finish dates; and
c: undertaken collectively to achieve a specified objective within constraints of time, cost, and other resources; and
d: for which the person bears the financial risk and effectively owns the results, if any; and
e: for which the person incurs on research and development activities performed in New Zealand more than half of the total amount of expenditure and depreciation loss that would be eligible expenditure under section LH 4 subsection (2) Meaning of overseas eligible expenditure
5: Overseas eligible expenditure
a: would, in the absence of this subsection, be eligible expenditure under section LH 4
b: is incurred by the person in research and development activities performed outside New Zealand in the 2008–09 income year or a later income year as part of a research and development project; and
c: is limited to a maximum amount of 10% of the total eligible expenditure under section LH 4 amount depreciation loss income year New Zealand overseas eligible expenditure research and development activities research and development project tax credit tax year 2004 No 35 s LH 7(2)(j), (k), (4)
LH 7: Research and development activities and related terms
Research and development activities
1: In this subpart, research and development activities
a: systematic, investigative, and experimental activities that are performed for the purposes of acquiring new knowledge or creating new or improved materials, products, devices, processes, or services and that—
i: are intended to achieve an advance in science or technology by resolving scientific or technological uncertainty:
ii: involve an appreciable element of novelty:
b: other activities that are wholly or mainly for the purpose of, required for, and integral to, the performing of the activities referred to in paragraph (a) Systematic, investigative, and experimental activities
2: In this subpart, systematic, investigative, and experimental activities
a: are planned activities directed towards a particular purpose and following a logical progression of work involving hypothesis, experiment, observation, and evaluation; and
b: are not excluded under schedule 21 Scientific or technological uncertainty
3: In this subpart, scientific or technological uncertainty Novelty
4: In this subpart, novelty Technology
5: In this subpart, technology novelty research and development activities scientific or technological uncertainty systematic investigative and experimental activities technology 2004 No 35 s LH 5
LH 8: Orders in Council
The Governor-General may make an Order in Council—
a: providing that a kind of expenditure included in the kinds of expenditure referred to in schedule 21 clauses 5 and 6
b: setting the date from which the exclusion applies. tax credit 2004 No 35 s LH 7(5)
LH 9: Internal software development: general
When sections LH 10 to LH 13
1: Sections LH 10 to LH 13 Eligible expenditure
2: The amount of eligible expenditure is adjusted to the following:
a: the amount determined under section LH 10
b: the amount determined under section LH 11
c: the amount determined under section LH 12
d: the total of amounts determined under sections LH 10 to LH 12 paragraphs (a) to (c) amount associated internal software developer income year internal software development 2004 No 35 s LH 10(1), (2)
LH 10: Internal software development: no associated internal software developer
Eligible expenditure
1: If the person referred to in section LH 9(1) section LH 4
a: the eligible expenditure related to internal software development that the person would have for the period in the absence of this section:
b: the amount for the period calculated using the formula— Definition of items in formula
2: In the founula,—
a: limit section LH 13
b: days amount associated internal software developer income year 2004 No 35 s LH 10(3), (4)
LH 11: Internal software development: associated internal software developer with same income year
Who this section applies to
1: This section applies to a person referred to in section LH 9(1) Eligible expenditure
2: The person has eligible expenditure related to internal software development under section LH 4
a: the eligible expenditure related to internal software development that the person would have for the period in the absence of this section:
b: the amount calculated under subsection (3)
c: the part, allocated by the internal software development group to the person, of the amount determined under subsection (5) Maximum amount for period
3: The amount referred to in subsection (2)(b) Definition of items in formula
4: In the formula in subsection (3)
a: limit section LH 13
b: days Amount available for allocation
5: The amount referred to in subsection (2)(c)
a: the total eligible expenditure related to internal software development that the members of the group would have in the absence of this section for income years corresponding to the tax year:
b: the amount for the tax year calculated using the formula— Definition of items in formula
6: In the formula in subsection (5)(b)
a: group limit section LH 13
b: days amount associated internal software developer income year internal software development group tax year 2004 No 35 s LH 10(5)
LH 12: Internal software development: associated internal software developer with different income year
When this section applies
1: This section applies to a person referred to in section LH 9(1) Eligible expenditure for period less than year
2: If the period is less than the person's income year, the person has no eligible expenditure related to internal software development under section LH 4 Eligible expenditure for income year
3: If the period is the person's income year, the person has eligible expenditure related to internal software development under section LH 4
a: the eligible expenditure related to internal software development that the person would have for the period in the absence of this section:
b: the part, allocated by the internal software development group to the person, of the amount determined under subsection (4) Amount available for allocation
4: The amount referred to in subsection (3)(b)
a: the total eligible expenditure related to internal software development that the members of the group would have in the absence of this section for income years corresponding to the tax year:
b: an amount equal to the limit set out in section LH 13 amount associated internal software developer income year internal software development group tax year 2004 No 35 s LH 10(11)-(14)
LH 13: Internal software development: limit
Amount
1: The item limit sections LH 10(2)(a), LH 11(4)(a), and LH 12(4)(b) group limit section LH 11(6)(a) subsection (2) Determination of amount by Minister
2: The Minister may, by notice published in the Gazette subsection (1)
a: the internal software development will be exploited mainly for the benefit of the New Zealand economy; and
b: New Zealand will derive a substantial net benefit from the intended completion of the internal software development; and
c: the person or the internal software development controller of the group has a commitment to retain the value of their business in New Zealand. Requirements in determination
3: A determination under subsection (2)
a: may include requirements that the Minister thinks are appropriate for the application of the determination; and
b: does not apply to a person who does not meet a requirement of the determination. amount business income year internal software development internal software development controller internal software development group New Zealand notice 2004 No 35 s LH 10(15), (16)
LH 14: Treatment of depreciation loss for certain depreciable property
What this section applies to
1: This section applies to a person who owns an item of depreciable property for which no deduction has been allowed for an amount of depreciation loss because the person derives exempt income. This section applies only for the purposes of calculating eligible expenditure under this subpart. Depreciation loss for tax credit
2: For the purposes of calculating the amount of depreciation loss the person has for the item under section EE 1(2)
a: acquiring the item on the later of the 2 following days:
i: the first day of the 2008–09 income year:
ii: the day on which they acquire the item; and
b: allowed a deduction for depreciation loss for the item for the income years ending after the day on which the person is treated as acquiring it under this section. Marketvalue and 20% loading
3: An item treated as acquired by a person under subsection (2)(a)(i)
a: acquired for its market value; and
b: meeting the requirements of section EE 31(2)(b)(i) to (iv)
i: did not meet those requirements when, but for subsection (2)(a)(i)
ii: was acquired by the person, but for subsection (2)(a)(i) acquire amount deduction depreciable property depreciation loss exempt income income year own 2004 No 35 s LH 11
LH 15: Listed research providers
Application
1: A person may apply to be a listed research provider by notifying the Commissioner that they—
a: meet the 2 start-up requirements of subsection (2)
b: undertake to meet the continuing requirements of subsection (3) Start-up requirements
2: The start-up requirements are that the person—
a: is capable of performing research and development activities on behalf of other persons; and
b: has in New Zealand the facilities needed to perform the research and development activities. Continuing requirements
3: The continuing requirements are that the person—
a: charges market prices for performing the research and development activities; and
b: is available to perform research and development activities on behalf of persons not associated with them; and
c: keeps records as required by section 22(2)(kd) of the Tax Administration Act 1994 Published listing of applicants
4: The Commissioner may list the person as a listed research provider if the Commissioner is satisfied that they meet the requirements of subsection (2) Subsection (10) Period of listing
5: A person listed under subsection (4)
a: under subsection (6)
b: under subsection (7) Request for removal from list
6: If a listed research provider notifies the Commissioner that they wish to be removed from the list, they are removed from the list from the later of the following:
a: the date set out in the notice:
b: the date on which the Commissioner receives the notice. Removal from list by Commissioner
7: If the Commissioner is satisfied that a person is not meeting a requirement of subsection (2) or (3)
a: the date set out in the notice:
b: the date that is 1 month after the date of the notice. No challenge
8: No challenge to a decision by the Commissioner under subsection (7) When subsection (10)
9: Subsection (10)
a: has been listed under subsection (4)
b: has been removed from the list under subsection (6) or (7)
c: reapplies under subsection (1) Conditions for relisting
10: If the Commissioner is satisfied that the person meets the requirements of subsection (2) subsection (3) amount associated person Commissioner listed research provider New Zealand notice notify research and development activities 2004 No 35 s LH 8
LH 16: Industry research co-operatives
An industry research co-operative industry members
a: carries on a business activity in New Zealand as a resident or through a fixed establishment in New Zealand; and
b: would meet the requirements of section LH 2
i: the person performed the research and development activities, or had the research and development activities performed on the person's behalf; and
ii: section LH 2(3)(a)
c: contributes to the financing of the research and development activities by payments made—
i: to the industry research co-operative:
ii: as a levy imposed under section 4 of the Commodity Levies Act 1990
iii: as a levy imposed under section 5 of the Building Research Levy Act 1969 business Commissioner fixed establishment industry research co-operative New Zealand research and development activities resident 2004 No 35 s LH 9
LH 17: Some definitions
In this subpart,— associated internal software developer person A
a: who is performing, or having another person perform, internal software development at the time; and
b: for whom the internal software development controller is the same as the internal software development controller of person A internal software development internal software development
a: a purpose of having the software used in—
i: the internal administration of business activities of the person or of another person associated with them:
ii: providing services to customers of the person or another person associated with them whose main reason for using the services is to obtain a service other than the use of the person's computer technology or software:
b: the main purpose that is neither—
i: selling, renting, licensing, hiring, or leasing the software by the person to customers of which 2 or more are not associated with the person nor with each other:
ii: including the software as an integral part of an electrical or mechanical device for which the software is developed and that has for the person the main purpose of being sold, rented, licensed, hired, or leased to customers as part of the person's business internal software development controller person A internal software development controller internal software development controller
a: having the power to govern, directly or indirectly, the financial and operating policies of person A to obtain benefits from person A's activities; and
b: having no other person or persons with the power to govern, directly or indirectly, the financial and operating policies of the group to obtain benefits from the group's activities internal software development group controller
a: the controller is the internal software development controller of the entity; and
b: the entity is performing, or having another person perform, internal software development; and
c: the entity has an associated internal software developer. associated person deduction income year internal software development internal software development controller internal software development group research and development activities tax year 2004 No 35 s LH 12 .
449: New section LO 2B
After section LO 2
LO 2B: Credit of RSCT for Maori authority credit
Retirement scheme contributions
1: A retirement scheme contributor who attaches a Maori authority credit to a retirement scheme contribution for a person in an income year has a credit of RSCT equal to the lesser of—
a: the amount of the Maori authority credit:
b: the liability of the contributor for RSCT on the contribution. When credit more than liability
2: If the amount of the Maori authority credit is more than the liability of the contributor for RSCT on the contribution,—
a: the amount of the excess is treated as a Maori authority credit attached to a taxable Maori authority distribution from the contributor to the person; and
b: the person responsible for withholding the RSCT must, within 30 days of the contribution, notify the person of the amount of the excess credit. amount income year Maori authority credit notify retirement scheme contribution retirement scheme contributor RSCT 2004 No 35 s LD 4 .
450: Tax credits for supplementary dividends
1: In section LP 2(2) 67/187 7/10
2: After section LP 2(6)
7: Section OZ 12 subsection (2)
451: Application of benchmark dividend rules and imputation credit ratio
After section LP 5(2)
3: Section OZ 12
452: Relationship with exempt income rules
After section LP 8(4)
5: Section OZ 12 subsection (3)(c)
453: What this subpart does
Section MA 1 This Part identifies the tax credits to which a person is entitled—
a: under the family scheme for a tax year, see
b: under the superannuation savings scheme for a year beginning on 1 July and ending on 30 June, see
c: for a redundancy payment, see
454: Avoidance arrangements
In section MA 6 family support credits tax credits for families
455: Some definitions for family scheme
1: In section MA 8
a: before the definition of chief executive abating WFF tax credit section MD 1
b: in the definition of child tax credit family assistance credit WFF tax credit
c: the definition of family assistance credit
d: in the definition of family credit abatement family assistance credit abating WFF tax credit
e: the definition of family plus
f: the definition of family support family tax credit section MD 3 family tax credit section MD 3
g: the definition of family tax credit
h: the definition of in-work payment in-work tax credit section MD 10 :
i: after the definition of in-work tax credit minimum family tax credit section ME 1 :
j: the definition of net family scheme income
k: in the definition of parental tax credit family assistance credit abating WFF tax credit
l: after the definition of social assistance payment WFF tax credit means a tax credit under either section MD 1 (Abating WFF tax credit) or ME 1 (Minimum family tax credit) .
2: In section MA 8
a: abating WFF tax credit minimum family tax credit WFF tax credit
b: family assistance credit
456: Adjustments for calculation of family scheme income
1: In section MB 1(5) and (c) section CX 56(1)(b)
2: After section MB 1(5) Retirement scheme contributions
5B: For the purposes of subsection (1) section CX 50B(2)
3: In section MB 1 retirement scheme contribution
457: New section MB 6
After section MB 5
MB 6: Treatment of distributions from retirement savings schemes
When this section applies
1: This section applies when—
a: a person receives a distribution of a retirement scheme contribution from a retirement savings scheme in an income year; and
b: RSCT has been withheld from the contribution; and
c: at the time of the distribution, the person is—
i: not eligible for New Zealand superannuation; and
ii: eligible for a distribution of a retirement scheme contribution from a retirement scheme contributor. Assessable income
2: For the purposes of calculating family scheme income, the distribution is assessable income of the person derived in the income year in which the distribution is made. assessable income family scheme income income year New Zealand superannuation retirement savings scheme retirement scheme contribution retirement scheme contributor RSCT 2004 No 35 s KD 1(1)(hb) .
458: What this subpart does
1: In section MC 1(1) family support and family plus WFF tax credits
2: Section MC 1(2) to (4) WFF tax credits
2: The WFF tax credit is the amount of a person's entitlement and tax credit made up of—
a: the family tax credit calculated under section MD 3
b: the in-work tax credit, see sections MD 4 to MD 10 section MZ 1
c: the parental tax credit, see sections MD 11 and MD 12
d: the minimum family tax credit, see section ME 1 Classification of credits
3: For the purposes of the calculation of an amount of a WFF tax credit, entitlements and tax credits under the family scheme are divided into—
a: abating WFF tax credits, made up of the family tax credit, in-work tax credit or child tax credit, and the parental tax credit:
b: the minimum family tax credit.
3: In section MC 1
a: abating WFF tax credit in-work tax credit minimum family tax credit WFF tax credit
b: family assistance credit family plus family support in-work payment,
459: Third requirement: residence
In section MC 5(2)(a) Family assistance credit Abating WFF tax credit Family tax credit Minimum family tax credit
460: When person does not qualify
1: In section MC 6(a) a family assistance credit an abating WFF tax credit
2: In section MC 6(b) a family tax credit an in-work tax credit, parental tax credit, or minimum family tax credit
3: In section MC 6
a: abating WFF tax credit in-work tax credit minimum family tax credit parental tax credit
b: family assistance credit family tax credit,
461: When spouse or partner entitled under family scheme
In section MC 7(2)(b) for all WFF tax credits other than the in-work tax credit, the Commissioner
462: Continuing requirements
1: In section MC 8(e) family assistance credit WFF tax credit
2: In section MC 8(f) protected family support protected family tax credit
3: In section MC 8
a: protected family tax credit WFF tax credit
b: family assistance credit protected family support
463: Credits for person aged 18
1: In section MC 9(1) Family assistance credit Abating WFF tax credit Family tax credit Minimum family tax credit
2: In section MC 9(2) a family assistance credit an abating WFF tax credit family tax credit minimum family tax credit
3: In section MC 9
a: abating WFF tax credit minimum family tax credit
b: family assistance credit
464: Principal caregiver
1: In the heading to section MC 10(2) family assistance credit abating WFF tax credit family support family tax credit
2: In section MC 10(2) family support family tax credit
3: In the heading to section MC 10(3) in-work payment in-work tax credit
4: In the heading to section MC 10(4) in-work payment in-work tax credit
5: In section MC 10(4) in-work payment in-work tax credit
6: In section MC 10
a: abating WFF tax credit family tax credit in-work tax credit
b: family assistance credit family support in-work payment
465: Heading: subpart MD
The heading to subpart MD Subpart MD—Abating WFF tax credits
466: Family assistance credit
1: The heading to section MD 1 Abating WFF tax credit
2: In section MD 1(1) family assistance credit abating WFF tax credit
3: In the formula in section MD 1(2)
a: the item family support family tax credit
b: the item payment or credit in-work tax credit or child tax credit
c: the item family credit abatement credit abatement
4: In section MD 1(3)(a) family support family tax credit
5: In section MD 1(3)(b) payment or credit in-work tax credit or child tax credit in-work payment in-work tax credit
6: Section MD 1(3)(d)
d: credit abatement
i: a family credit abatement calculated using the formula in section MD 13(2) section MD 16(3)(b)
ii: a parental tax credit abatement calculated using the formula in section MD 16(2)
7: In section MD 1
a: abating WFF tax credit family tax credit in-work tax credit
b: family support in-work payment
467: Calculating net contributions to credits
1: In section MD 2(1) family support, the in-work payment family tax credit, the in-work tax credit
2: In section MD 2(2)(a) family support, in-work payment family tax credit, the in-work tax credit
3: In section MD 2(2)(c)(i) family support family tax credit
4: In section MD 2(2)(c)(ii) in-work payment in-work tax credit
5: After section MD 2(2) Credit abatements
3: Section MD 16
6: In section MD 2
a: family tax credit in-work tax credit
b: family support in-work payment
468: Calculation of family support
1: The heading before section MD 3 Family tax credit
2: In the heading to section MD 3 support tax credit
3: In section MD 3(1) family support family tax credit
4: In section MD 3(7) Family support A family tax credit
5: In section MD 3
a: family tax credit
b: family support
469: Entitlement to in-work payment
1: The heading before section MD 4 In-work tax credit
2: In the heading to section MD 4 payment tax credit
3: In section MD 4(1) payment tax credit
4: In the heading to section MD 4(2) payment tax credit
5: In section MD 4(2) payment tax credit
6: In section MD 4
a: in-work tax credit
b: in-work payment
470: First requirement: person's age
1: In section MD 5 payment tax credit
2: In section MD 5
a: in-work tax credit
b: in-work payment
471: Second requirement: principal care
1: In section MD 6(1) payment tax credit
2: In section MD 6
a: in-work tax credit
b: in-work payment
472: Third requirement: residence
1: In section MD 7(1) payment tax credit
2: In section MD 7
a: in-work tax credit
b: in-work payment
473: Fourth requirement: person not receiving benefit
1: In section MD 8 payment tax credit
2: In section MD 8
a: in-work tax credit
b: in-work payment
474: Fifth requirement: full-time earner
1: In section MD 9(1) in-work payment in-work tax credit
2: In section MD 9
a: in-work tax credit
b: in-work payment
475: Calculation of in-work payment
1: In the heading to section MD 10 payment tax credit
2: In section MD 10(1) payment tax credit
3: In section MD 10(3)(c)(ii) payment tax credit
4: In section MD 10
a: in-work tax credit
b: in-work payment
476: Calculation of family credit abatement
1: The heading before section MD 13 Credit abatement
2: In section MD 13(3)(b) support tax credit
3: In section MD 13
a: protected family tax credit
b: protected family support
477: Person receiving protected family support
1: In the heading to section MD 14 support tax credit
2: In section MD 14(1) support tax credit
3: In section MD 14
a: protected family tax credit
b: protected family support
478: New section MD 16
After section MD 15
MD 16: Calculation of parental tax credit abatement
When this section applies
1: This section applies when—
a: a person is entitled under section MD 11
b: they choose to have the credit paid in a lump sum; and
c: the birth occurs within 56 days of the end of the tax year. Amount of abatement
2: Despite section MD 2 Definition of items in formula
3: In the formula,—
a: full-year abatement section MD 13(3)(a)
b: amount used section MD 13 section MD 2(2)(c)(i) and (ii) amount entitlement period family credit abatement parental entitlement period parental tax credit pay tax year 2004 No 35 s KD 2B .
479: Heading: subpart ME
The heading to subpart ME Subpart ME—Minimum family tax credit
480: Family tax credit
1: The heading to section ME 1 Minimum family tax credit
2: In section ME 1(1) minimum family
3: In section ME 1(3)(b) calculated using the formula in section ME 3, net family scheme income,
4: In section ME 1
a: minimum family tax credit
b: family tax credit
481: Meaning of employment for this subpart
1: In section ME 2(1) minimum family
2: In section ME 2
a: minimum family tax credit
b: family tax credit
482: New section ME 3
After section ME 2
ME 3: Meaning of net family scheme income
When this section applies
1: This section applies for the purposes of this subpart. Formula
2: Net family scheme income Definition of items in formula
3: In the formula,—
a: adjusted income
i: the amount of the person's net income under section MB 1
ii: calculated without reference to the amounts referred to in section MB 1(2) and (3)
b: weeks
c: adjusted liability
i: treating the amount of adjusted income under paragraph (a)
ii: taking into account any tax credit under section LC 1 or LC 2
d: amount received section MB 1(2)
e: amount paid section MB 1(3) amount deduction full-time earner income tax liability net income pay relationship period tax credit tax year 2004 No 35 s OB 1 net specified income .
483: Application for payment of tax credit by instalment
In section MF 1(1)(a) Family assistance credit Abating WFF tax credit Family Minimum family
484: When person not entitled to payment by instalment
1: In section MF 2(1)(b) a family assistance credit an abating WFF tax credit
2: In section MF 2
a: abating WFF tax credit
b: family assistance credit
485: Calculating amount of interim family assistance credit
1: In the heading to section MF 3 family assistance credit WFF tax credit
2: In section MF 3(2)(c) family assistance credit WFF tax credit
3: In section MF 3
a: WFF tax credit
b: family assistance credit
486: Requirements for calculating instalment of tax credit
1: In section MF 4(1) Family assistance credit Abating WFF tax credit Family tax credit Minimum family tax credit
2: In section MF 4(1)(b)(ii) family support family tax credit in-work payment in-work tax credit family tax credit minimum family tax credit
3: In section MF 4
a: in-work tax credit minimum family tax credit
b: family support in-work payment
487: Recovery of overpaid tax credit
In section MF 5(1) Family assistance credit Abating WFF tax credit Family tax credit Minimum family tax credit
488: Overpayment of tax credit
In section MF 6(1) Family assistance credit Abating WFF tax credit Family tax credit Minimum family tax credit
489: Orders in Council
1: In section MF 7(1)(a) family support family tax credit
2: In section MF 7(1)(b) in-work payment in-work tax credit
3: In section MF 7(1)(d) family tax credit minimum family tax credit
4: In the heading to section MF 7(4) in-work payment in-work tax credit
5: In section MF 7(4) in-work payment in-work tax credit
6: In section MF 7
a: in-work tax credit minimum family tax credit
b: family support in-work payment
490: New subpart ML inserted
After section MK 8
ML: Tax credits for redundancy payments
ML 1: What this subpart does
Redundancy payments
1: This subpart provides a tax credit for a person who derives a redundancy payment for loss of employment. Exclusions
2: Despite subsection (1)
a: related to—
i: retirement from employment:
ii: loss of seasonal employment arising from the normal seasonal work cycle:
iii: a contract of employment for a fixed term or for the duration of a project:
iv: employment for a period following notice of termination of employment:
b: paid—
i: to a director of a company by the company or a person associated with the company under the 1988 version provisions:
ii: to a person by a person associated with them under the 1988 version provisions:
iii: by a person to an employee who has been paid a redundancy payment by a person associated with the person under the 1988 version provisions. 1988 version provisions associated person company director employee employment pay tax credit 2004 No 35 s KC 6(1), (3)
ML 2: Tax credit for redundancy payments
A person who derives a redundancy payment for loss of employment has a tax credit for a tax year of an amount equal to the lesser of—
a: $3600:
b: an amount of 6 cents for every complete dollar of the total amount of the redundancy payment derived by the person. amount employment pay tax credit tax year 2004 No 35 s KC 6(1)
ML 3: Payment by Commissioner
The person referred to in section ML 2 section 41B of the Tax Administration Act 1994 Commissioner pay tax credit 2004 No 35 s KC 6(2) .
491: Entitlement to child tax credit
1: In section MZ 1(1)(b) in-work payment in-work tax credit
2: In section MZ 1(3) in-work payment in-work tax credit
3: In section MZ 1
a: in-work tax credit
b: in-work payment
492: Calculation of maximum permitted ratios
After section OA 18(3) Relationship with sections OZ 8 and OZ 9
4: Sections OZ 8 and OZ 9
493: Australian companies with imputation credit accounts
1: In section OB 2(2)(a)(i) (c) to (e) (b) to (1)
2: Section OB 2(2)(a)(ii)
ii: is treated as resident in a country other than Australia under an agreement between Australia and the other country that would be a double tax agreement if negotiated between New Zealand and that other country; or .
494: ICA payment of tax
After section OB 4(3)(e)
eb: income tax paid by a tax credit under sections LA 2 and LH 2 .
495: New sections OB 7B and OB 7C
After section OB 7
OB 7B: ICA payment of qualifying company election tax
Credit
1: An ICA company has an imputation credit for an amount of qualifying company election tax paid under section HA 40 Table reference
2: The imputation credit in subsection (1) Credit date
3: The credit date is the day the qualifying company election tax is paid. amount ICA company imputation credit pay qualifying company election tax 2004 No 35 s ME 4(1)(ae), (2)(ae)
OB 7C: ICA expenditure on research and development
Credit
1: An ICA company has an imputation credit for an amount of a tax credit that the company has under section LH 2 Table reference
2: The imputation credit in subsection (1) Credit date
3: The credit date is the day the Commissioner is notified in the company's return of income of the entitlement to the credit. amount Commissioner ICA company imputation credit return of income tax credit 2004 No 35 s ME 4(1)(ib), (2)(g) .
496: ICA attribution for personal services
In section OB 16(1) 49.25% 42.86%
497: Table O1: imputation credits
In table O1 5B Payment of qualifying company election tax day of payment section OB 7B 5C Tax credit for research and development expenditure day return filed section OB 7C
498: ICA on-market cancellation
1: In section OB 42(1) RWT rate tax rate
2: Section OB 42(2)(b)
b: tax rate schedule 1 clause 2
499: Further income tax when company stops being ICA company
1: Section OB 66(2)
2: The company must pay the further income tax to the Commissioner—
a: by the day the company stops being an ICA company; or
b: for a company that is no longer an ICA company because it becomes a portfolio investment entity, by the end of the tax year in which it stops being an ICA company.
2: In section OB 66 portfolio investment entity
500: Statutory producer boards attaching imputation credits to cash distributions
After section OB 73(8) Relationship with section OZ 15
9: Section OZ 15 subsection (4)
501: Statutory producer boards' notional distributions that are dividends
After section OB 75(5) Relationship with section OZ 15
6: Section OZ 15 subsection (2)
502: Co-operative companies attaching imputation credits to cash distributions
After section OB 78(7) Relationship with section OZ 15
8: Section OZ 15 subsection (3)
503: Co-operative companies' notional distributions that are dividends
After section OB 80(4) Relationship with section OZ 15
5: Section OZ 15 subsection (2)
504: FDP credits and imputation credits attached to dividends
After section OC 29(6) Relationship with section OZ 8
7: Section OZ 8
505: General rules for companies with CTR accounts
After section OD 1(6) Relationship with section OZ 17
7: Section OZ 17
506: CTR credits and imputation credits attached to dividends
After section OD 22(6) Relationship with section OZ 8
7: Section OZ 8
507: Branch equivalent tax accounts of companies
After section OE 2(6) Relationship with section OZ 16
7: Section OZ 16 sections OE 6 to OE 16
508: BETA payment of income tax
1: In section OE 7(2) same consolidated group same group of companies
2: After section OE 7(3) Maximum amount
3B: Despite subsection (3) and section OP 101(2) section OE 6(1) debit balances
3: In section OE 7(4) company's branch equivalent tax account branch equivalent tax account of the company that made the election under subsection (3)
509: BETA unused amount of debit balance
In section OE 8(1) same consolidated group same group of companies
510: MACA payment of tax
After section OK 2(3)(c)
cb: income tax paid by a tax credit under sections LA 2 and LH 2 .
511: New section OK 4B
After section OK 4
OK 4B: MACA expenditure on research and development
Credit
1: A Maori authority has a Maori authority credit for an amount of a tax credit that the authority has under section LH 2 Table reference
2: The Maori authority credit in subsection (1) Credit date
3: The credit date is the day the authority's return of income is filed. amount Commissioner Maori authority credit return of income tax credit 2004 No 35 s MK 4(1)(gb), (2)(db) .
512: Table O17: Maori authority credits
In table O17 4B Tax credit for research and development expenditure day return filed section OK 4B
513: When credits and debits arise only in consolidated imputation group accounts
After section OP 5(2)(b)
bb: section OP 11B .
514: Consolidated ICA payment of tax
After section OP 7(3)(f)
fb: income tax paid by a tax credit under sections LA 2 and LH 2 .
515: New section OP 11B
After section OP 11
OP 11B: Consolidated ICA expenditure on research and development
Credit
1: A consolidated imputation group has an imputation credit for an amount of a tax credit that a group company has under section LH 2 Table reference
2: The imputation credit in subsection (1) Credit date
3: The credit date is the day the return of income relating to the amount, is filed. amount Commissioner company consolidated imputation group imputation credit return of income tax credit 2004 No 35 s ME 11(1)(ib), (2)(db) .
516: Table O19: imputation credits of consolidated imputation groups
In table O19 6B Tax credit for research and development expenditure day return filed section OP 11B
517: CTR accounts of consolidated groups
After section OP 78(2) Relationship with section OZ 17
3: Section OZ 17 sections OP 81 to OP 96
518: When credits and debits arise only in branch equivalent tax group accounts
After section OP 99(4) Relationship with section OZ 16
5: Section OZ 16 sections OP 100 to OP 108
519: Consolidated BETA payment of income tax
1: After section OP 101(2) Maximum amount
2B: Despite subsection (2) and section OE 7(3) section OE 6(1) section OP 100(1) debit balances
2: In section OP 101(3) the group's branch equivalent tax account the branch equivalent tax account of the group or group company B, as applicable
3: In section OP 101 MF 10(3),
520: New sections OZ 7 to OZ 17 added
After section OZ 6
OZ 7: Memorandum accounts in transitional period
Sections OZ 8 to OZ 15 transitional period
a: beginning the first day of a person's 2008-09 income year; and
b: ending on 31 March 2010. income year 2004 No 35 ss MZ 10(1)(a), MZ 11(1)(a), MZ 12(1)(a), MZ 13(1)(a), MZ 14(1)(a), MZ 15(1)(a), MZ 16(1)(a), MZ 17(1)(a)
OZ 8: Attaching imputation credits and FDP credits: maximum permitted ratio
When this section applies
1: This section applies when—
a: a company pays a dividend in the transitional period; and
b: the company has a credit balance in its imputation credit account and FDP account from income, expenditure, memorandum account debits, credits, and balances, refunds, tax, tax credits, transfers, amounts withheld, or other items dealt with, arising, or calculated using an old company tax rate. Rate applying for transitional period
2: If the amount of the imputation credit or FDP credit attached to the dividend is limited by the maximum permitted ratio set out in section OA 18 section OA 18(2) amount company dividend FDP account FDP credit imputation credit imputation credit account income maximum permitted ratio tax credit tax year transitional period 2004 No 35 s MZ 13
OZ 9: Benchmark dividends: ratio change
When this section applies
1: This section applies when—
a: a company pays a dividend in the transitional period; and
b: the dividend is a later dividend for the purposes of sections OB 61(4) and OC 28(4)
c: the relevant benchmark dividend—
i: was 1 to which section OZ 8
ii: has a ratio of 33/67, for a reason other than the application of section OZ 8 When ratio treated as same as ratio for benchmark dividend
2: If, in the cases set out in subsection (3) Cases
3: The cases referred to in subsection (2)
a: in the case of a benchmark dividend described in subsection (1)(c)(i), section OZ 8 section OZ 8
b: in the case of a benchmark dividend described in subsection (1)(c)(ii) benchmark dividend company dividend FDP ratio imputation ratio transitional period 2004 No 35 s MZ 14
OZ 10: Modifying ratios for imputation credits and FDP credits
When this section applies
1: This section applies when—
a: a person derives a dividend in the period from 1 October 2007 to 31 March 2010; and
b: the dividend and the imputation credits and FDP credits attached to the dividend, as applicable, have —
i: an imputation ratio greater than 30/70 and less than or equal to 33/67; or
ii: an FDP ratio greater than 30/70 and less than or equal to 33/67; or
iii: a combined imputation and FDP ratio greater than 30/70 and less than or equal to 33/67. Ratio applying
2: For the purposes of section OA 5(2) and (3) section OA 18 combined imputation and FDP ratio dividend FDP credit FDP ratio imputation credit imputation ratio maximum permitted ratio transitional period 2004 No 35 s MZ 15
OZ 11: Tax credits for imputation credits and FDP credits
When this section applies
1: This section applies when—
a: a person derives a dividend in the transitional period; and
b: the dividend, and the imputation credits and FDP credits attached to the dividend, as applicable, have—
i: an imputation ratio greater than 30/70 and less than or equal to 33/67; or
ii: an FDP ratio greater than 30/70 and less than or equal to 33/67; or
iii: a combined imputation and FDP ratio greater than 30/70 and less than or equal to 33/67; and
c: the person is a new tax rate person in the period for the dividend. Imputation ratio and FDP ratio
2: For a ratio described in subsection (1)(b)(i) or (ii) dividend and credits × 0.30. Definition of item in formula
3: In the formula in subsection (2) dividend and credits section LE 1(1) or LF 1(1) Combined imputation and FDP ratio
4: For a ratio described in subsection (1)(b)(iii) dividend and credits × 0.30. Definition of item in formula
5: In the formula in subsection (4) dividend and credits section LE 1(1) and LF 1(1) amount assessable income basic tax rate combined imputation and FDP ratio dividend FDP credit FDP ratio imputation credit imputation ratio tax credit total tax credit transitional period 2004 No 35 s MZ 16
OZ 12: Tax credits for non-resident investors
When this section applies
1: This section applies when—
a: a company pays or derives a dividend with an imputation credit attached in the transitional period; and
b: the dividend and imputation credit, to the extent to which, in the absence of subpart LP (Tax credits for supplementary dividends),—
i: the combined imputation and FDP ratio is greater than 30/70 and less than or equal to 33/67; or
ii: the imputation ratio is greater than 30/70 and less than or equal to 33/67; and
c: section LP 2(1) When ratio equal to old rate
2: For a ratio described in subsection (1)(b)(i) or (ii) section LP 2(2) When ratio less than old rate
3: For a ratio described in subsection (1)(b)(i) or (ii) section OZ 8 section LP 2(2) Benchmark calculations
4: In the application of sections GB 35, GB 36, OA 18, OB 60, OB 61, OC 28 section LP 5 Relationship with exempt income rules
5: If the company derives a dividend to which this section applies, item tax rate section LP 8(2) subsection (2) or (3) amount combined imputation and FDP ratio company dividend imputation credit imputation ratio non-resident pay supplementary dividend supplementary dividend holding company tax credit transitional period 2004 No 35 s MZ 17
OZ 13: Fully credited dividends: modifying actual ratio
What this section applies to
1: This section applies in the transitional period to a dividend for which, in the absence of this section, the actual ratio under section CD 43(26) Ratio for calculation
2: In the calculation under section CD 43(26) dividend fully credited transitional period 2004 No 35 s MZ 18
OZ 14: Dividends from qualifying companies
When this section applies
1: This section applies when—
a: a qualifying company pays a dividend in the transitional period; and
b: section OZ 8 Exempt income
2: In the calculation under section HA 14 tax rate section HA 15(2) dividend exempt income qualifying company transitional period 2004 No 35 s MZ 19
OZ 15: Attaching imputation credits and notional distributions: modifying amounts
When this section applies
1: This section applies when—
a: a statutory producer board or a co-operative company determines to pay a cash distribution or make a notional distribution in the transitional period; and
b: the board or company has a credit balance in its imputation credit account from income, expenditure, memorandum account debits, credits, and balances, refunds, tax, tax credits, transfers, amounts withheld, or other items dealt with, arising, or calculated using an old company tax rate. Statutory producer boards' imputation credits
2: In the calculation under section OB 73(4) tax rate Statutory producer boards' notional distributions
3: In the calculation under section OB 75(2) tax rate Co-operative companies' imputation credits
4: In the calculation under section OB 78(3) tax rate Co-operative companies' notional distributions
5: In the calculation under section OB 80(2) tax rate amount co-operative company imputation credit account income Maori authority statutory producer board tax credit transitional period 2004 No 35 s MZ 20
OZ 16: BETA reductions
What this section applies to
1: This section applies to—
a: a credit and a debit in the branch equivalent tax account of a company or a consolidated group before the first day of their 2008–09 income year:
b: a credit and a debit arising to the branch equivalent tax account of a company or a consolidated group on or after the first day of their 2008–09 income year, if the credit and debit relate to their 2007–08 or earlier income years. Reduction
2: The amount of the credit and debit are reduced by multiplying the amount by 30/33. amount branch equivalent tax account company consolidated group income year 2004 No 35 s MZ 21
OZ 17: CTRA reductions
What this section applies to
1: This section applies to—
a: a credit and a debit in the CTR account of a company or a consolidated group before the first day of their 2008–09 income year:
b: a credit and a debit arising to the CTR account of a company or a consolidated group on or after the first day of their 2008–09 income year, if the credit and debit relate to their 2007–08 or earlier income years. Reduction
2: The amount of the credit and debit are reduced by multiplying the amount by 30/33. amount company consolidated group CTR account income year 2004 No 35 s MZ 22 .
521: What this Part does
1: After section RA 1(g)
gb: the payment of retirement scheme contribution tax (RSCT), see .
2: In section RA 1 retirement scheme contribution RSCT
522: New section RA 6B
After section RA 6
RA 6B: Withholding and payment obligations for retirement scheme contributions
A person who makes a contribution to a retirement savings scheme must withhold and pay RSCT for the contribution to the Commissioner under subpart RH (Withholding tax on retirement scheme contributions) by the due dates. Commissioner pay retirement savings scheme RSCT Compare: 2004 No 35 s NEB 1 .
523: When obligations not met
1: In section RA 10(1)(a) a retirement scheme contribution, an employer's superannuation contribution,
2: In section RA 10 NEB 4(1),
524: Payment dates for interim and other tax payments
1: After section RA 15(1)(b) provided by them. provided by them; or
c: to withhold and pay under section RA 6B .
2: Section RA 15(3)(b)
b: for PAYE, RWT, NRWT, and RSCT payable monthly under section RD 4(1)(a), RE 21(2) and (7), RF 13(3), or RH 2(2) .
3: In section RA 15 retirement scheme contribution,
4: In section RA 15 NEB 3(1),
525: Amalgamation of companies
In section RA 20 NEB 3(2),
526: New section RA 24
After section RA 23
RA 24: Application of other provisions for purposes of RSCT rules
For the purposes of the RSCT rules, sections 170(2), 171, and 172 of the Tax Administration Act 1994
a: a reference to an amount of tax withheld were a reference to RSCT:
b: a reference to the RWT rules were a reference to the RSCT rules. amount of tax RSCT rules RWT rules 2004 No 35 s NEB 7(1) .
527: Estimation method
Section RC 7(6)
6: If, under section RC 18(5)
a: C and F for changes to a 6-monthly GST taxable period:
b: B, D, and F for other changes.
528: GST ratio method
1: After section RC 8(3) When no assessment for tax year before preceding tax year
3B: Subsection (3)
a: for the year before the preceding tax year—
i: an assessment of a base amount has not been made and the absence of an assessment arises because of an extension of time for filing a return for the year, or a period in the year:
ii: an assessment of a base amount is the subject of a dispute or challenge under the Tax Administration Act 1994
iii: the year is a transitional year; and
b: for the year that is 2 years before the preceding tax year—
i: the base amounts have been assessed; and
ii: the circumstances in paragraph (a)(ii) and (iii)
2: After section RC 8(7) When no assessment for tax year before preceding tax year
7B: Subsection (7)
a: for the year before the transitional year—
i: an assessment of a base amount has not been made and the absence of an assessment arises because of an extension of time for filing a return for the year, or a period in the year:
ii: an assessment of a base amount is the subject of a dispute or challenge under the Tax Administration Act 1994
iii: the year is a transitional year; and
b: for the year that is 2 years before the transitional year—
i: the base amounts have been assessed; and
ii: the circumstances in paragraph (a)(ii) and (iii)
529: Provisional tax payable in instalments
1: In section RC 9(7) section RC 7 or RC 10 section RC 10
2: In section RC 9(9) paragraph (a)
9: A person with a new provisional tax liability who starts a taxable activity in a tax year is liable to pay interest calculated under section 120KC of the Tax Administration Act 1994 .
3: Section RC 9(9)(b)(ii)
ii: if they pay GST on a 6-monthly basis and start a taxable activity at some time in the period that starts at the beginning of the corresponding income year and ends 30 days before the date of instalment C: .
530: Calculating amount of instalment under standard and estimation methods
In section RC 10(1)(b) section RC 9(3) and (7) section RC 9(3) and (5)
531: Who may use GST ratio?
1: In section RC 16(2) preceding tax year: preceding tax year and corresponding income year:
2: In section RC 16(2)(b) whole tax year whole income year
3: In section RC 16(5) the tax year before a tax year earlier than
532: When GST ratio must not be used
In section RC 17(4)(a) in writing or by telephone apply
533: Changing calculation method
1: In section RC 18(2) Subsection (3) and (4) Subsection (4) or (5)
2: In section RC 18(4) (5), as if the election to use the GST ratio had not been made (5). The person is treated as never having chosen to use the GST ratio method and, for the purposes of section 120KE(5) of the Tax Administration Act 1994
534: Disposal of assets
Section RC 19(2)
2: The person may choose to take the disposal of the asset into account in adjusting their taxable supplies for the relevant taxable period and income year, by subtracting the value, including GST, of the asset from—
a: the total taxable supplies for a taxable period for the purposes of the formula in section RC 11(1) section 20(4) of that Act
b: the base amount of total taxable supplies for the corresponding income year under section RC 8(2) section 20(4) of that Act
535: Paying provisional tax in transitional years
1: Section RC 21(2)(a) and (b)
a: the 28th day of the months set out in schedule 3 paragraph (b) or (c)
b: 15 January, when the month set out in schedule 3
c: 7 May, when the month set out in schedule 3
2: In section RC 21(3)(b) month. month; or
c: 7 May, when March is the final month and the year is a transitional year.
536: Consequences of a change in balance date
Section RC 25(6)
6: The person must—
a: adjust their provisional tax liability for the part-period of 1 month before the start of the new income year; and
b: pay the instalment of provisional tax for the part-period as their final taxable period—
i: 28 days after the end of the part period, unless subparagraph (ii) or (iii)
ii: by 15 January if the part-period falls in November; or
iii: by 7 May if the part period falls in March.
537: Registering for GST or cancelling registration
Section RC 26(5)
5: For the purposes of subsection (4)
a: the cancellation of GST registration is notified:
b: the person's liability under section 52 of the Goods and Services Tax Act 1985
538: What this subpart does
In section RD 1(c) and RSCT rules the ESCT rules
539: PAYE income payments
In section RD 3(1)(b)(ii) subsection (2) subsection (2)
iii: a personal service rehabilitation payment under the Injury Prevention, Rehabilitation, and Compensation Act 2001
540: Private use of motor vehicle: when schedular value not used
1: In section RD 56(1) clause 5 clause 9
2: In section RD 56(2) paragraph (a) clause 4(a) clause 8(a)
3: In section RD 56(3) clause 4(a) clause 8(a)
541: Private use of motor vehicle: when schedular value used
In section RD 57(1) clause 5 clause 9
542: Resident passive income
1: In section RE 2(1)(c) other than a retirement scheme contribution distribution
2: In section RE 2(5)(g) payment. payment:
h: a dividend that is excluded income under section CX 50B subsection (2)(a) and (b)
i: a dividend other than a non-cash dividend that—
i: has an imputation ratio, FDP ratio, or combined imputation and FDP ratio of 30/70 or more; and
ii: is paid by a unit trust or group investment fund (or RWT proxy on their behalf) that has not withheld RWT from any earlier dividend.
3: In section RE 2 combined imputation and FDP ratio excluded income FDP ratio group investment fund imputation ratio non-cash dividend RWT RWT proxy unit trust
543: When amount of tax treated as FDP credit
In section RE 23(2) LE 9, LF 6 to
544: New section RF 16 inserted
After section RF 15
RF 16: Relationship with RSCT rules
When this section applies
1: This section applies when a retirement scheme contributor makes a retirement scheme contribution for a person who is non-resident and pays RSCT for the contribution. NRWT
2: The contributor is treated as having withheld from the contribution an amount of NRWT equal to the lesser of—
a: the amount of RSCT paid:
b: the NRWT payable in relation to the contribution. Treatment of balance
3: Section LB 6 non-resident NRWT pay retirement scheme contribution retirement scheme contributor RSCT 2004 No 35 s NG 16B .
545: New subpart RH inserted
After section RG 7
RH: Withholding tax on retirement scheme contributions
RH 1: RSCT rules and their application
Meaning
1: The RSCT rules
a: this subpart; and
b: section BE 1(5B)
c: section CX 50B
d: section LB 6
e: section LE 7B
f: section LO 2B
g: section MB 1(5B)
h: section MB 6
i: schedule 1 clause 7
j: sections 28C and 48B and Part 9 of the Tax Administration Act 1994 Application
2: (2) The RSCT rules apply to a retirement scheme contributor who makes a retirement scheme contribution. retirement scheme contribution retirement scheme contributor RSCT rules 2004 No 35 s OB 1 RSCWT rules
RH 2: Retirement scheme contributions
Contribution for benefit of members
1: A retirement scheme contribution Tax credits
2: For the purposes of subsection (1) Determining amount of contribution
3: The amount of a retirement scheme contribution is the sum of—
a: the amount of the contribution received by the retirement savings scheme and not withheld under subsection (5)
b: the amount of tax for the retirement scheme contribution. Payment of amount of tax
4: A retirement scheme contributor who pays an amount that represents a retirement scheme contribution must withhold and pay to the Commissioner the amount of tax for the contribution. The amount is payable monthly under section RA 15 Appointment of agent
5: For the purposes of subsection (4) amount amount of tax Commissioner imputation credit Maori authority credit retirement savings scheme retirement scheme contribution retirement scheme contributor 2004 No 35 ss NEB 1(2), NEB 2, NEB 3(1)(a), OB 1 retirement scheme contribution
RH 3: Retirement savings schemes
Requirements for entity
1: An entity is a retirement savings scheme for a person if the entity—
a: is a portfolio investment entity; and
b: holds funds from a retirement scheme contribution for the person; and
c: has rules (the distribution rules
i: are approved by the Commissioner as fair and reasonable; and
ii: meet the requirements of subsection (2) Requirements for rules
2: The rules must provide that—
a: the availability of a distribution to the person is restricted before the person reaches an age of retirement set out in the rules:
b: the person is not permitted to make a withdrawal before the age of retirement other than a withdrawal—
i: to repay a student loan under the Student Loan Scheme Act 1992
ii: to pay fees and expenses related to tertiary education:
iii: to buy a home if the person does not own one:
iv: that the person would be permitted to make if the scheme were a KiwiSaver scheme under the KiwiSaver Act 2006
v: in circumstances set out in the distribution rules that have been approved under subsection (1)(c)(i)
c: the entity may require the person to provide information to ensure that the requirements relating to a withdrawal are met. Commissioner income year portfolio investment entity retirement savings scheme retirement scheme contribution retirement scheme contributor 2004 No 35 s NEB 5
RH 4: Retirement scheme contributors
An entity is a retirement scheme contributor for a person for an income year if—
a: the entity is—
i: the trustee of a widely-held trust that is a unit trust:
ii: a company other than a close company:
iii: a Maori authority; and
b: the person is a unit holder, shareholder, or member of the entity:
c: in or before the income year, the entity makes a payment intended to be a retirement scheme contribution for the person. close company company income year Maori authority pay retirement savings scheme retirement scheme contribution retirement scheme contributor shareholder trustee unit holder unit trust widely-held trust 2004 No 35 s NEB 6 Calculating amounts of tax
RH 5: Calculating amounts of tax for retirement scheme contribution
The amount of tax for a retirement scheme contribution is the amount determined under schedule 1 clause 7 amount of tax retirement scheme contribution 2004 No 35 s NEB 1(1)
RH 6: Calculating amounts of tax on failure to withhold
When this section applies
1: This section applies when a retirement scheme contributor or retirement savings scheme does not withhold an amount of tax for a retirement scheme contribution under section RH 2(4) Calculation of amount
2: The amount is calculated using the formula— Definition of items in formula
3: In the formula,—
a: tax rate schedule 1 clause 7
b: contribution to scheme
c: tax already paid amount amount of tax retirement savings scheme retirement scheme contribution retirement scheme contributor RSCT 2004 No 35 s NEB 4(1) .
546: Using refund to satisfy tax liability
In section RM 10(4) family scheme income tax credits for families
547: Standard method: 2008–09 and 2009–10 income years
1: In section RZ 3(1) portfolio tax rate entity's persons entity uses a 30% basic tax rate person is a new tax rate person
2: In section RZ 3 new tax rate person
3: In section RZ 3 ss s , OB 1 new tax rate person
548: GST ratio method: 2008–09 and 2009–10 income years
1: In section RZ 4(1) portfolio tax rate entity's persons entity uses a 30% basic tax rate person is a new tax rate person
2: In section RZ 4 new tax rate person
3: In section RZ 4 ss s , OB 1 new tax rate person
549: Calculating amounts under standard method: 2008–09 and 2009–10 income years
1: In section RZ 5(1) portfolio tax rate entity's persons entity uses a 30% basic tax rate person is a new tax rate person
2: In section RZ 5 new tax rate person
3: In section RZ 5 ss s , OB 1 new tax rate person
550: Definitions
1: This section amends section YA 1
2: After the definition of 1990 version provisions abating WFF tax credit section MA 8
3: In the definition of amount of tax RSCT rules, ESCT rules,
4: In the definition of ancillary tax paragraph (k)
kb: RSCT: .
5: After the definition of associated associated internal software developer section LH 17 .
6: In the definition of basic tax rate paragraph (a) RSCT, RWT,
7: In the definition of charitable organisation listed in schedule 32 to which section LD 3(2) schedule 32
8: In the definition of child paragraph (c) Family assistance credit Abating WFF tax credit Family tax credit Minimum family tax credit
9: After the definition of depreciation recovery income derivative instrument section EW 15F section EW 15G .
10: In the definition of development for the purposes of sections DB 34, EE 1, EJ 22, and EJ 23 for the purposes of that section and section DB 34
11: After the definition of distribution district health board section 19 of the New Zealand Public Health and Disability Act 2000
12: In the definition of employee paragraph (c)(i) section RD 5(1)(b)(iii), (2) section RD 5(1)(b)(iii), (3)
13: In the definition of employment paragraph (b) Family tax credit Minimum family tax credit
14: After the definition of environmental restoration account equity instrument section EW 151(3) .
15: After the definition of fair dividend rate method fair value method .
16: The definition of family assistance credit
17: The definition of family plus
18: The definition of family support
19: In paragraph (b) life) life):
c: the person enters on or after 20 June 2007 and is, or is part of, an arrangement that, when the person enters the lease or when a change in the terms of the arrangement changes the allocation or size of the risks and rewards incidental to ownership of the lease asset,—
i: involves the use of the asset outside New Zealand for all or most of the term of the lease; and
ii: involves income of any person who is not the lessor, arising from the use of the asset by any person, that is exempt income, or excluded income, or non-residents' foreign sourced income; and
iii: is a finance lease under NZIAS 17 for the lessor, or for a company that is in the same group of companies as the lessor and derives assessable income from the arrangement, or is an arrangement under which persons who do not include the lessor bear substantially all the risks and rewards incidental to ownership of the lease asset, determined as at the time the person enters the lease and taking into account later changes to the arrangement .
20: In the definition of financial statements subpart EB (Valuation of trading stock (including dealer's livestock)) subparts EB (Valuation of trading stock (including dealer's livestock)) and EW (Financial arrangements rules)
21: After the definition of geothermal well gifting settlor section EX 46(12) .n
22: In the definition of group of companies section IC 3(1) section IC 3
23: After the definition of identical share IFRS impaired credit adjustment section EW 15D(3)
24: After the definition of indirect income interest industry research co-operative section LH 16
25: After the definition of intermediary internal software development section LH 17 internal software development controller section LH 17 internal software development group section LH 17 .
26: In the definition of investor paragraphs (b) and (c)
b: for a portfolio investment entity is defined in section HL 5B .
27: The definition of in-work payment in-work tax credit section MA 8 .
28: After the definition of listed PAYE intermediary listed research provider section LH 15
29: After the definition of minibus minimum family tax credit section MA 8
30: In the definition of net family scheme income section MA 8 section ME 3
31: After the definition of new start grant new tax rate person
a: means a person who uses a 30% basic tax rate for 2008–09 and later income years:
b: includes a portfolio tax rate entity .
32: After the definition of New Zealand tax Niue International Trust Fund .
33: After the definition of non-filing taxpayer non-integral fee .
34: After the definition of notional sale price novelty section LH 7(4) .
35: After the definition of NRWT rules NZIAS 2 NZIAS 8 NZIAS 17 NZIAS 32 NZIAS 39 NZIAS 41 section EB 6(3) .
36: After the definition of offshore permit area old company tax rate .
37: After the definition of outstanding balance overseas eligible expenditure is section LH 6(5) .
38: After the definition of personal property lease payment personal service rehabilitation payment
a: under section 81(3) of the Injury Prevention, Rehabilitation, and Compensation Act 2001
b: by the Accident Compensation Corporation or an employer that is an accredited employer as defined in section 181 of that Act
c: in providing to the person a key aspect of social rehabilitation referred to in—
i: section 81(1)(b), (c), (e), or (g)
ii: section 81(1)(h) paragraph (a)(i) transport for independence schedule 1, clause 12 of that Act .
39: The definition of petroleum mining operations petroleum mining operations section CT 6B .
40: In the definition of portfolio entity investment a portfolio investment entity an entity
41: In the definition of portfolio investment entity paragraph (c) fund fund:
d: portfolio investment-linked life fund .
42: After the definition of portfolio investment entity portfolio investment-linked life fund means a separate identifiable fund forming part of a life insurer, that—
a: holds investments subject to life insurance policies under which benefits are directly linked to the value of the investments held in the fund; and
b: has become a portfolio investment entity under section HL 13
c: has not ceased to be a portfolio investment entity under section HL 15 .
43: The definition of portfolio investor class portfolio investor class section HL 5B .
44: In the definition of portfolio investor exit period paragraph (b)(ii)
ii: ending on a day in the tax year on which the amount of the entity's portfolio tax liability under section HL 21 .
45: The definition of portfolio investor rate portfolio investor rate
a: 33%, if paragraphs (b) and (c)
b: the rate, if paragraph (c)
i: to the entity as the prescribed investor rate for the investor and the period; and
ii: in the latest notice before the time; or
c: 0%, if—
i: the entity makes payments of tax under section HL 22
ii: the portfolio investor rate for the investor for the portfolio calculation period would, in the absence of this paragraph, be more than 0%; and
iii: the portfolio calculation period includes part of a portfolio investor exit period for the investor .
46: In the definition of portfolio land company paragraph (b)
a: in the words before subparagraph (i) 80% 80% or more
b: in subparagraph (ii) of the company of the company; and
c: meets the requirements of section HL 10(2) .
47: In the definition of portfolio listed company paragraph (d) entity) entity); and
e: is not a portfolio investment-linked life fund .
48: In the definition of portfolio tax rate entity paragraph (d) fund fund; and
e: is not a portfolio investment-linked life fund .
49: In the definition of principal caregiver family assistance credit, family support, in-work payment, WFF tax credit, in-work tax credit,
50: The definition of protected family support protected family tax credit section MD 14 .
51: After the definition of reduced deficit debit redundancy payment
a: to a person whose employment is terminated because their employer no longer needs an employee to perform the duties performed by the person as an employee; and
b: in compensation for the loss of the employment .
52: In the definition of refundable tax credit paragraph (a) family income assistance family payments paragraph (b)
bb: a tax credit under subpart LH (Tax credits for expenditure on research and development) .
53: In the definition of reporting standard that section and the purposes of
54: In the definition of research for the purposes of sections DB 34, EE 1, EJ 22, and EJ 23 for the purposes of that section and section DB 34
55: After the definition of research research and development activities section LH 7(1) research and development project section LH 6(3) .
56: In the definition of residual income tax paragraph (b)
iiib: section LB 6
vb: section LH 2 .
57: After the definition of retained earnings retirement savings scheme section RH 3 retirement scheme contribution section RH 2 retirement scheme contributor section RH 4 retirement scheme prescribed rate
a: 0% if the person is a non-resident at the time and the contribution is non-resident passive income; or
b: 19.5% if the person—
i: has, in either of the 2 income years immediately before the year in which the contribution is made, taxable income of $38,000 or less:
ii: is a non-resident and the retirement scheme contributor is a Maori authority, and the distribution is $200 or less:
iii: is a non-resident and the retirement scheme contributor is a Maori authority and the person supplies the Maori authority with a notice under section 28C of the Tax Administration Act 1994
c: 33% if the person has, in either of the 2 income years immediately before the year in which the contribution is made, taxable income of $60,000 or less; or
d: 39% .
58: After the definition of royalty RSCT RSCT rules section RH 1 .
59: After the definition of schedular taxable income scientific or technological uncertainty section LH 7(3) .
60: In the definition of shareholder paragraph (c) (PDA) (PCA)
61: After the definition of social assistance suspensory loan sound commercial reason section EW 26(7)
62: After the definition of supply systematic, investigative, and experimental activities section LH 7(2) .
63: After the definition of taxpayer technology section LH 7(5) .
64: After the definition of terminating share tertiary institution section 162 of the Education Act 1989 .
65: After the definition of time of the sale Tokelau International Trust Fund .
66: After the definition of transferor transitional period section OZ 7 sections OZ 8 to OZ 15 .
67: In the definition of venture investment agreement for the purposes of that section
68: After the definition of voting interest WFF tax credit section MA 8 .
551: Company and company's associate: 1988 version provisions
After section YB 4(3) Exclusion: subpart LH
3B: Despite subsection (3) section LH 1(2)
552: Partnerships: partnership and associate of partner
After section YB 17(3)(c) those provisions. those provisions; and
d: for the purposes of the 1990 version provisions (which are certain provisions relating to petroleum mining and some other miscellaneous rules), the term associated
553: Some definitions
1: After section YB 20(2)(o)
ob: subpart LH (Tax credits for expenditure on research and development): .
2: After section YB 20(2)(s)
sb: sections ML 1 to ML 3 .
554: Schedule 1—Basic tax rates: income tax, ESCT, RWT, and attributed fringe benefits
1: In the heading to schedule 1 RSCT, RWT,
2: In schedule 1, part A, clause 6 Taxable income: trustees of certain funds
3: After schedule 1, part D, clause 6 Basic rates for RSCT
7: Retirement scheme contributions
The payment rate for an amount of a retirement scheme contribution made by a retirement scheme contributor for a person is set out in table 5. Table 5 Row Conditions Payment rate 1 The person responsible for withholding RSCT— (a) has been notified under section 28C of the Tax Administration Act 1994 (b) has been supplied with the tax file number of the person 0.195 2 The person— (a) is a non-resident; and (b) the retirement scheme contributor is a Maori authority; and (c) the distribution is $200 or less 0.195 3 The person responsible for withholding RSCT— (a) has been notified under section 28C of the Tax Administration Act 1994 (b) has been supplied with the tax file number of the person 0.330 4 When rows 1 and 2 do not apply. 0.390 How to use this table Find the applicable condition, in the middle column, in order to find the relevant rate to apply, in the right column.
555: Schedule 2—Basic tax rates for PAYE income payments
In schedule 2, part B, table 1, row 3 RD 11(2)(b) or RD 18(3) RD 10(2)(b) or RD 17(3)
556: Schedule 4—Rates of tax for schedular payments
After schedule 4, part H,
I: Personal service rehabilitation payments
1: A personal service rehabilitation payment for a person under the Injury Prevention, Rehabilitation, and Compensation Act 2001
557: Schedule 14—Depreciable intangible property
In the shoulder note for schedule 14 EE 2 EE 62
558: New schedule 21
After schedule 20 schedule 3
559: Schedule 32 To omit Christian Children's Fund of New Zealand Limited (CCFNZ) Childfund New Zealand Limited To insert Hamlin Charitable Fistula Hospitals Trust Hope Foundation Development Trust Hope International Charitable Trust Limbs 4 All Charitable Trust New Zealand Disaster Assistance Response Team Trust Operation Restore Hope Charitable Trust The World Swim for Malaria Foundation (New Zealand)
560: Schedule 49—Enactments amended
In schedule 49 Income Tax (Social Assistance Suspensory Loans) Order 1995 (SR 1995/79) Injury Prevention, Rehabilitation, and Compensation (Work Account Levies) Regulations 2007 (SR 2007/70) Regulation 3 tax year section OB 1 of the Income Tax Act 2004 section YA 1 of the Income Tax Act 2007 Injury Prevention, Rehabilitation, and Compensation (Earners' Levy) Regulations 2007 (SR 2007/71) Regulation 3 tax year section OB 1 of the Income Tax Act 2004 section YA 1 of the Income Tax Act 2007
561: Schedule 50 Tax Administration Act 1994 To omit the items relating to section 33A(1)(a)(iiic), 33C(1)(b), 120KE(6)(a), and 141B
562: Consequential amendments to Income Tax Act 2007
The sections of the Income Tax Act 2007 schedule 4