Taxation (Accrual Rules and Other Remedial Matters) Act 1999

1: Short Title
This Act may be cited as the Taxation (Accrual Rules and Other Remedial Matters) Act 1999.
1: Amendments to
Income Tax Act 1994 Part 1 repealed 1 April 2005 YA 2 Income Tax Act 2004
2: Income Tax Act 1994
Part 1 repealed 1 April 2005 YA 2 Income Tax Act 2004
3: Interpretation
Part 1 repealed 1 April 2005 YA 2 Income Tax Act 2004
4: Double tax agreements
Part 1 repealed 1 April 2005 YA 2 Income Tax Act 2004
5: Exempt income—employee allowances and expenditure on account of employee
Part 1 repealed 1 April 2005 YA 2 Income Tax Act 2004
6: Investment income
Part 1 repealed 1 April 2005 YA 2 Income Tax Act 2004
7: Commercial bills
Part 1 repealed 1 April 2005 YA 2 Income Tax Act 2004
8: Meaning of term
dividends Part 1 repealed 1 April 2005 YA 2 Income Tax Act 2004
9: Holding and acquisition of interests in foreign companies
Part 1 repealed 1 April 2005 YA 2 Income Tax Act 2004
10: Calculation and attribution of controlled foreign company repatriation
Part 1 repealed 1 April 2005 YA 2 Income Tax Act 2004
11: Branch equivalent income calculation
Part 1 repealed 1 April 2005 YA 2 Income Tax Act 2004
12: Interpretation of fringe benefit tax rules
Part 1 repealed 1 April 2005 YA 2 Income Tax Act 2004
13: Value of fringe benefit
Part 1 repealed 1 April 2005 YA 2 Income Tax Act 2004
14: Insurance with persons not carrying on business in New Zealand
Part 1 repealed 1 April 2005 YA 2 Income Tax Act 2004
15: Certain deductions not allowed—rents, interest, and premises
Part 1 repealed 1 April 2005 YA 2 Income Tax Act 2004
16: Certain property not trading stock
Part 1 repealed 1 April 2005 YA 2 Income Tax Act 2004
17: Treatment of petroleum mining exploration and development expenditure
Part 1 repealed 1 April 2005 YA 2 Income Tax Act 2004
18: New sections inserted
Part 1 repealed 1 April 2005 YA 2 Income Tax Act 2004
19: Interest from inflation-indexed instruments
Part 1 repealed 1 April 2005 YA 2 Income Tax Act 2004
20: Cost of trading stock other than excepted financial arrangements
Part 1 repealed 1 April 2005 YA 2 Income Tax Act 2004
21: Transfer of trading stock within wholly-owned group
Part 1 repealed 1 April 2005 YA 2 Income Tax Act 2004
22: New subpart substituted
Part 1 repealed 1 April 2005 YA 2 Income Tax Act 2004
23: New division added
Part 1 repealed 1 April 2005 YA 2 Income Tax Act 2004
24: Consequential changes to section references resulting from
Part EH Division 2 Part 1 repealed 1 April 2005 YA 2 Income Tax Act 2004
25: New section inserted
Part 1 repealed 1 April 2005 YA 2 Income Tax Act 2004
26: Costs of acquiring any film or any right in any film
Part 1 repealed 1 April 2005 YA 2 Income Tax Act 2004
27: Cost of producing films
Part 1 repealed 1 April 2005 YA 2 Income Tax Act 2004
28: New sections inserted
Part 1 repealed 1 April 2005 YA 2 Income Tax Act 2004
29: Option to use foreign tax balance date
Part 1 repealed 1 April 2005 YA 2 Income Tax Act 2004
30: New sections inserted
Part 1 repealed 1 April 2005 YA 2 Income Tax Act 2004
31: Taxation of hire purchase agreements
Part 1 repealed 1 April 2005 YA 2 Income Tax Act 2004
32: Special provisions relating to dispositions of property
Part 1 repealed 1 April 2005 YA 2 Income Tax Act 2004
33: Transfer of property or obligation under financial arrangements deemed to be at market value
Part 1 repealed 1 April 2005 YA 2 Income Tax Act 2004
34: Acquisition of property by amalgamated company on qualifying amalgamation
Part 1 repealed 1 April 2005 YA 2 Income Tax Act 2004
35: Succession of obligations of amalgamating company under financial arrangement on amalgamation
Part 1 repealed 1 April 2005 YA 2 Income Tax Act 2004
36: Treatment of financial arrangements between amalgamating companies
Part 1 repealed 1 April 2005 YA 2 Income Tax Act 2004
37: Rules for calculating New Zealand group debt percentage
Part 1 repealed 1 April 2005 YA 2 Income Tax Act 2004
38: Rules for calculating worldwide group debt percentage
Part 1 repealed 1 April 2005 YA 2 Income Tax Act 2004
39: Concession for on-lending
Part 1 repealed 1 April 2005 YA 2 Income Tax Act 2004
40: New section inserted
Part 1 repealed 1 April 2005 YA 2 Income Tax Act 2004
41: Accrual rules
Part 1 repealed 1 April 2005 YA 2 Income Tax Act 2004
42: Taxable income to be calculated generally as if group were single company
Part 1 repealed 1 April 2005 YA 2 Income Tax Act 2004
43: Profits of mutual associations in respect of transactions with members
Part 1 repealed 1 April 2005 YA 2 Income Tax Act 2004
44: Trustee income
Part 1 repealed 1 April 2005 YA 2 Income Tax Act 2004
45: Existing trusts becoming subject to tax
Part 1 repealed 1 April 2005 YA 2 Income Tax Act 2004
46: Low income rebate
Part 1 repealed 1 April 2005 YA 2 Income Tax Act 2004
47: Rebate for gifts of money
Part 1 repealed 1 April 2005 YA 2 Income Tax Act 2004
48: Determination of net income
Part 1 repealed 1 April 2005 YA 2 Income Tax Act 2004
49: Interest paid in conduit financing arrangements
Part 1 repealed 1 April 2005 YA 2 Income Tax Act 2004
50: Amount of provisional tax payable
Part 1 repealed 1 April 2005 YA 2 Income Tax Act 2004
51: Assessment and payment of terminal tax
Part 1 repealed 1 April 2005 YA 2 Income Tax Act 2004
52: Payment of tax
Part 1 repealed 1 April 2005 YA 2 Income Tax Act 2004
53: Assessment and payment of tax
Part 1 repealed 1 April 2005 YA 2 Income Tax Act 2004
54: Application of NRWT rules
Part 1 repealed 1 April 2005 YA 2 Income Tax Act 2004
55: Definitions
Subsection (36)(b) repealed 93(2) Taxation (Remedial Matters) Act 1999 Part 1 repealed 1 April 2005 YA 2 Income Tax Act 2004
56: Meaning of
income tax Part 1 repealed 1 April 2005 YA 2 Income Tax Act 2004
57: Determination of
consideration Part 1 repealed 1 April 2005 YA 2 Income Tax Act 2004
58: Airport operators
Part 1 repealed 1 April 2005 YA 2 Income Tax Act 2004
59: Further definitions of associated persons
Subsection (1)(c) repealed 93(3) Taxation (Remedial Matters) Act 1999 Part 1 repealed 1 April 2005 YA 2 Income Tax Act 2004
60: References to particular regimes in former Act, etc
Part 1 repealed 1 April 2005 YA 2 Income Tax Act 2004
2: Amendments to Tax Administration Act 1994
61: Tax Administration Act 1994
This Part amends the Tax Administration Act 1994
62: Interpretation
1: In section 3
a: In the definition of binding ruling paragraph (c)
d: Status ruling made under section 91GA :
b: The following definitions are inserted: Competent authority section 173B Contested act of assistance section 173B Contested tax section 173B Tax recovery agreement section 173B
c: In the definition of disputable decision (b)
b: A decision of the Commissioner under a tax law, except for a decision—
i: To decline to issue a binding ruling under Part VA
ii: That cannot be the subject of an objection under Part VIII
iii: That cannot be challenged under Part VIIIA :
d: The definition of late payment penalty Late payment penalty
a: A civil penalty imposed under section 139B
b: For sections 157, 183A, 183B, and 183D
i: Additional tax imposed on unpaid tax under section 139
ii: Additional tax imposed on any tax remaining unpaid under section 41 of the Goods and Services Tax Act 1985
iii: Interest on gift duty imposed under section 84 of the Estate and Gift Duties Act 1968
iv: A penalty imposed for unpaid stamp duty under section 58 of the Stamp and Cheque Duties Act 1971 section 86E
A: An instrument of conveyance executed; and
B: A bill of exchange made, drawn, or prepaid under sections 81 to 83 of that Act
C: A liable transaction entered into:
v: Interest on unpaid totalisator duty under section 8 of the Gaming Duties Act 1971 section 4 of that Act
vi: Interest on unpaid racing duty under section 12 of the Gaming Duties Act 1971
vii: Interest on unpaid gaming machine duty under section 12F of the Gaming Duties Act 1971
viii: Interest on unpaid casino duty under section 21Q of the Gaming Duties Act 1971 :
e: In the definition of property sections 60 and section
f: The definition of return period Return period
a: The period covered by a tax return, or which would be covered by a tax return if one were provided:
b: For a tax return that relates to a transaction, the time within which the transaction must be returned: :
g: The following definition is inserted: Status ruling section 91GA :
h:
i: The following definitions are repealed: Holder Implementation date Issuer Trade credit
2: In section 3(4)(a) 60,
3: Subsections (1) (2) subsection (1)(d) (f)
4: Subsection (1)(d)
5: Subsection (1)(f) Subsection (1)(h) repealed 93(4) Taxation (Remedial Matters) Act 1999
63: New sections inserted
1: After section 22
22A: Records required under
Part EH Division 2 of Income Tax Act 1994
1: A taxpayer who applies section EH 36 of the Income Tax Act 1994 section 90AC(1)(c)
2: A taxpayer who applies section EH 43 of the Income Tax Act 1994
3: A taxpayer required to retain records must—
a: Take all reasonable precautions for the safe custody of those records; and
b: Retain those records for 7 years after the end of the year that the records relate to, unless:
i: The Commissioner has given notice that retention is not required; or
ii: The records are required by law to be given to another person; or
iii: The taxpayer is a company that has been liquidated or wound up; and
c: Retain the records required for a further period as specified by the Commissioner under subsection (4)
4: The Commissioner may, by giving notice before the end of the 7-year retention period specified in subsection (3)
a: The taxpayer is or has been under audit or investigation by the Commissioner; or
b: The Commissioner intends to conduct an audit or investigation before the expiry of the retention period as extended, or is actively considering an audit or investigation.
22B: Further records required under
Part EH
1: A trustee to whom either section EH 5 or EH 52
a: The amounts of debt forgiven by creditors; and
b: Amounts distributed to the trust's beneficiaries.
2: A trustee required to retain records must—
a: Take all reasonable precautions for the safe custody of those records; and
b: Retain those records for as long as the trust exists.
2: Subsection (1)
64: Resident withholding tax deduction certificates
1: Section 25(7)(a)
a: All resident withholding income is interest paid by the person under a financial arrangement, and the interest is not more than $20 in that income year; or
2: Subsection (1)
65: Annual income tax returns not required
1: Section 33A(1)(b)(x)
2: Section 33A(2)(c)
c: Is not a cash basis person; or .
3: Subsections (1) (2)
66: Dates by which annual returns to be furnished
1: Section 37(4A)
4A: If a tax agent has not furnished for an income year the required number of tax returns by the dates specified by the Commissioner, the Commissioner may:
a: Refuse to grant an extension of time under subsection (4)
b: Cancel any existing extension of time arrangement granted under subsection (4)
c: Cancel any existing extension of time arrangement granted under subsection (4)
2: Subsection (1)
67: New sections inserted
1: After section 44
44A: Special returns by taxpayers affected by reduced deductions under
Income Tax Act 1994
1: A taxpayer who has made a return of income for an income year must file a special return for that income year in the form required by the Commissioner if the taxpayer's net income or net loss for the income year is affected by—
a: A reduction under section DM 1A(4) section DM 1A(3)
b: A reduction under section EO 4A(4) section EO 4A(3)
c: A reduction under section DM 1A(4) section DM 1A(3)
d: A reduction under section EO 4A(4) section EO 4A(3)
2: A taxpayer who has derived consideration that gives rise to a reduction under section DM 1A(4) or section EO 4A(4)
a: For the income year in which the consideration is derived; and
b: By the date that the taxpayer's return of income for that income year would be due.
44B: Special returns for financial arrangements
1: A person who calculates an adjustment under section EH 57 of the Income Tax Act 1994 section EH 57(2)
2: Despite the time bar, the Commissioner must reassess the person's income tax liability for the income years to which the adjustment relates according to the calculations of income and expenditure under the adjustment.
2: The new section 44A
3: The new section 44B
68: Employers to make returns as to employees
1: After section 46(5)(d)
da: All payments of weekly compensation made by the Accident Compensation Corporation under the Accident Insurance Act 1998
db: Payments of compensation for loss of earnings or loss of potential earning capacity in so far as the payments relate to a work-related personal injury and are made by the Accident Compensation Corporation under a policy of personal accident or sickness insurance to which section 188(1)(a) of the Accident Insurance Act 1998 .
2: Subsection (1)
69: Disclosure of certain financial arrangement transactions where interest payable to exempt person, etc
1: Section 53(1)(b)(iii)
iii: A party to the financial arrangement; or .
2: Subsection (1)
70: Returns of inter-related arrangements
1: Section 60
2: Subsection (1)
71: Disclosure of information to prevent cessation of benefit payments
1: In section 82A(8)
a: The definition of beneficiary information
b: The following definition is inserted: Information about a beneficiary
a: Identifies the beneficiary; and
b: Identifies the benefit that the beneficiary is receiving, has received, or for which the beneficiary has applied: .
2: Subsection (1)
72: Secrecy obligations not to prevent disclosure in arrangements for relief from double taxation and exchange of information
1: In section 88 double tax agreement double tax agreement or tax recovery agreement
2: Subsection (1)
73: Purpose of this Part
1: After section 89A(2)
3: Despite section 1(2)
2: Subsection (1)
74: New sections inserted
1: After section 90
90AA: Application of determinations made under section 90
1: A determination made under section 90 Part EH Division 2 section 90AC
2: Once a determination is made under section 90AC Part EH Division 2 section 90
90AB: Application for determination
1: A person who becomes, or who intends to become, a party to a financial arrangement may apply to the Commissioner for a determination to be made under section 90AC(1)
2: Unless subsection (3)
3: If no regulations have been made under this Act or if regulations made do not provide for the eventuality that occurs, an application must be made in accordance with a procedure that the Commissioner prescribes.
90AC: Determinations relating to financial arrangements
1: For the purpose of the accrual rules in Part EH Division 2 of the Income Tax Act 1994
a: How the yield to maturity method applies to a financial arrangement or class of financial arrangements under section EH 34(1)
b: How the straight line method applies to a financial arrangement or class of financial arrangements under section EH 35
c: The market, the method, and the source of information, that a person may use to determine market value under section EH 36
d: The method for determining the income derived or expenditure incurred for a financial arrangement or class of financial arrangements under section EH 38(1)
e: The alternative method that may be applied to determine the income derived or expenditure incurred for a financial arrangement or class of financial arrangements under either section EH 34(2) or EH 38(2)
f: Whether a method meets the requirements of section EH 42(1)
g: Whether or not a method may be changed under section EH 42(3)
h: If a financial arrangement includes an excepted financial arrangement, the method for determining the portion of the income, gain, loss, expenditure, consideration paid, or consideration received that is solely attributable to the excepted financial arrangement:
i: The method for determining the future value, discounted value, or a combination of both the future and discounted values of amounts paid or payable on the date the first right in the contracted property is transferred or services are provided under an agreement to which either section EH 48(3)(c) or EH 48(3)(d)
j: The method for determining under section FD 10(4) section EH 47
k: The exchange rate that a taxpayer or a class of taxpayer may use, and the circumstances in which the rate may be used under section OB 7(2)(c)(ii) section OB 7(2)(a) or (b)
2: The Commissioner may also determine the class of persons that may apply a determination.
3: A determination made under any of subsection (1)(a), (1)(d), (1)(h), (1)(i), or (1)(j)
4: A determination is not made when the Commissioner accepts an alternative method to the yield to maturity method under section EH 34 section EH 38 of the Income Tax Act 1994
5: For the purpose of subsection (1)(e)
6: The Commissioner may vary, rescind, restrict, or extend a determination made under this section by replacing the determination or by making a new determination.
9OAD: Notification of determinations
1: The Commissioner must publish a determination made under section 90AC Gazette
2: A determination is made under section 90AC
3: The Commissioner must assess a person who has applied a determination made under section 90AC
a: The legislation on which the determination is based has been repealed or amended to the person's detriment; or
b: There was a material misrepresentation or omission in the person's application for the determination, whether intentional or not.
90AE: Four-year period in which determination does not have to be applied
If a person becomes a party to a financial arrangement before a new determination is made under section 90AC(6)
2: Subsection (1)
75: Determinations in relation to apportionment of interest costs
1: Section 90A(1)
1: For the purpose of Part FG of the Income Tax Act 1994
2: Subsection (1)
76: Taxation laws in respect of which binding rulings may be made
1: In section 91C(1)(e)(i) Section 90 Sections 90 or 90AC
2: Section 91C(1)(e)(iA)
iA: Section 90A of this Act
3: After section 91C(1)
1A: The Commissioner may make a binding ruling under section 91GB
4: Subsections (1) to (3)
77: Content and notification of a public ruling
1: Section 91DA(1)
1: A public ruling must state—
a: That it is a public ruling made under section 91D
b: The taxation law or laws on which it is a ruling; and
c: The arrangement to which the ruling applies; and
d: How the taxation law or laws apply to the arrangement; and
e: The period or income year for which the ruling applies. Anything that does not contain these statements is not a public ruling.
2: After section 91DA(3)
4: The Commissioner must publish each public ruling, in full, in a publication of the department.
3: Subsections (1) (2)
78: Effect of a public ruling
1: Section 91DB(2)
2: Subsection (1)
79: Application of a public ruling
1: Section 91DC
1: A public ruling on a taxation law applies to a person and an arrangement—
a: If the taxation law is expressly referred to in the ruling; and
b: For an arrangement that is—
i: Specified in the ruling; and
ii: Entered into during the period or income year for which the ruling applies; and
c: For the period or income year specified in the ruling.
2: Subsection (1)
2: Subsection (1)
80: Extension of a public ruling
1: In section 91DD(2)(b) or income year The original period
2: In section 91DD(2)(c) or income year the new period
3: Subsections (1) (2)
81: Withdrawal of a public ruling
1: Section 91DE(2)
2: The Commissioner must notify the withdrawal by giving adequate notice in the Gazette
2: Section 91DE(3)
3: A public ruling is withdrawn on the date stated in the notice of withdrawal. The date cannot be before the date on which notice is given under subsection (2)
3: Section 91DE(4)(b)
b: The ruling continues to apply, for the remainder of the period or income year to which the ruling applies, to an arrangement to which it previously applied that was entered into before the date of withdrawal.
4: In section 91DE(5)(c) or income year The original period
5: Subsections (1) to (4)
82: Commissioner to make private rulings on request
1: Section 91E(1)
1: Subject to section 91EF
2: In section 91E(3)(b) ; or paragraph (b) paragraph (b)
c: The applicant has outstanding debts relating to earlier binding ruling applications.
3: Section 91E(4)(b)
b: At the time the application is made or at any time before the ruling is issued, the Commissioner considers that the person to whom the ruling is to apply is not seriously contemplating the arrangement for which the ruling is sought; or .
4: Section 91E(4)(d)(i)
i: Concerns a tax (excluding provisional tax), duty, or levy that is due and payable, unless the application is received before the tax (excluding provisional tax), duty, or levy is due and payable; or
5: In section 91E(4)(e) any period a period or an income year
6: Section 91E(4)(f)
f: An assessment relating to the person, the arrangement, and a period or an income year to which the proposed ruling would apply has been made, unless the application is received by the Commissioner before the date an assessment is made; or .
7: Section 91E(4)(g)
g: The Commissioner is auditing or investigating how the taxation law applies to the person and to the arrangement for a period or an income year to which the proposed ruling would apply; or
ga: The application relates to an arrangement that is the subject of a notice of proposed adjustment; or .
8: Section 91E(4A)
4A: Subsection (4)(a) section FB 2 or GD 13 of the Income Tax Act 1994
9: Subsections (1) to (8)
83: Effect of a private ruling
1: After section 91EA(1)
1A: Subsection (1)
2: Section 91EA(2)
3: Subsections (1) (2)
84: Application for a private ruling
1: Section 91EB(1)(b)
b: Only for the period or income year for which the ruling applies.
2: Section 91EB(2)(c)
c: The Commissioner makes an assumption about a future event or another matter that is material to the ruling, and the assumption subsequently proves to be incorrect; or
d: The Commissioner stipulates a condition that is not satisfied.
3: Subsections (1) (2)
85: Applying for a private ruling
1: Section 91EC(1)
1: A person, in their own right or on behalf of a person who is yet to come into legal existence, may apply to the Commissioner for a private ruling on how a taxation law applies, or would apply, to—
a: The person making the application or the prospective person, as the case may be; and
b: An arrangement, whether a single or a recurring arrangement.
2: Section 91EC(2)
2: Two or more persons may jointly apply, or a person on behalf of two or more persons who are yet to come into legal existence, may apply to the Commissioner for a private ruling on how a taxation law applies, or would apply, to each person and to an arrangement, whether a single or a recurring arrangement.
3: Subsections (1) (2)
86: Content and notification of a private ruling
1: Section 91EH(1)
1: A private ruling must state—
a: That it is a private ruling made under section 91E; and
b: The identity of the person, the taxation law, and the arrangement (which may be identified by reference to the arrangement in the application) to which the ruling applies; and
c: How the taxation law applies to the arrangement and to the person; and
d: The period or income year for which the ruling applies; and
e: Material assumptions about future events or other matters made by the Commissioner; and
f: Conditions stipulated by the Commissioner. Anything that does not contain these statements is not a private ruling.
2: Subsection (1)
87: Withdrawal of a private ruling
1: After section 91EI(2)
2A: A status ruling on a withdrawn private ruling does not apply on and after the date specified in the notice of withdrawal.
2: In section 91EI(3)(b) or income year for the remainder of the period
3: In section 91EI(3), at the end of paragraph (b) withdrawal. withdrawal; and
c: A status ruling that has been made on the private ruling continues to apply, for the remainder of the period or income year specified in the private ruling, if the arrangement was entered into before the date of withdrawal.
4: Subsections (1) to (3)
88: Disclosure of private ruling
1: Section 91EJ
2: Subsection (1)
89: Commissioner may make product rulings
1: In section 91F(3)(b) ; or paragraph (b) paragraph (b)
c: The applicant has outstanding debts relating to earlier binding ruling applications.
2: Section 91F(4)(b)
b: At the time the application is made or at any time before the ruling is issued, the Commissioner considers that the person to whom the ruling is to apply is not seriously contemplating the arrangement for which the ruling is sought; or
3: Section 91F(4)(e)
e: A product ruling already exists on how the taxation law applies to the arrangement, and the proposed ruling would apply to a period or income year to which the existing ruling applies; or
4: Subsections (1) (2) (3)
90: Effect of a product ruling
1: After section 91FA(1)
1A: Subsection (1)
2: Section 91FA(2)
3: Subsections (1) (2)
91: Application of a product ruling
1: Section 91FB(1)(b)
b: Only for the period or income year for which the ruling applies.
2: Section 91FB(2)(c)
c: The Commissioner makes an assumption about a future event or another matter that is material to the application of the ruling, and the assumption subsequently proves to be incorrect; or
d: The Commissioner stipulates a condition that is not satisfied.
3: Subsections (1) (2)
92: Applying for a product ruling
1: Section 91FC(1)
1: A person, in their own right or on behalf of a person who is yet to come into legal existence, may apply to the Commissioner for a product ruling on how a taxation law applies, or would apply—
a: To an arrangement; or
b: To the consumer of the product that is the subject of the ruling, and to the arrangement.
1A: A person making an application under subsection (1)
1B: For the purpose of subsection (1)(b) consumer
2: Subsection (1)
93: Content and notification of a product ruling
1: Section 91FH
91FH:
1: A product ruling must state—
a: That it its a product ruling made under section 91F
b: The name of the person who applied for the ruling; and
c: The taxation law and the arrangement to which the ruling applies; and
d: How the taxation law applies to the arrangement; and
e: The period or income year for which the ruling applies; and
f: Material assumptions about future events or other matters made by the Commissioner; and
g: Conditions stipulated by the Commissioner. Anything that does not contain these statements is not a product ruling
2: The Commissioner must send a copy of the ruling to the applicant as soon as practicable after the date on which the ruling is made.
3: Unless earlier publication is requested by the applicant in writing, the Commissioner cannot publish a product ruling until 2 months have passed after the date the ruling is made.
4: If earlier publication is requested by the applicant, the Commissioner must—
a: Notify the making of the product ruling by notice in the Gazette
b: Publish the product ruling in a publication of the department as soon as possible.
5: After the 2-month period has ended, the Commissioner must—
a: Notify the making of a product ruling by notice in the Gazette
b: Publish each product ruling, in full, in a publication of the department.
6: A taxpayer, other than the applicant, cannot obtain a copy of a product ruling before it is published by the Commissioner.
2: Subsection (1)
94: Extension of a product ruling
1: Section 91FI
2: Subsection (1)
95: Withdrawal of a product ruling
1: Section 91FJ(2)
2: The Commissioner must notify the withdrawal by giving adequate notice in the Gazette
2: Section 91FJ(3)
3: A product ruling is withdrawn on the date stated in the notice of withdrawal. The date cannot be before the date on which notice is given under subsection (2)
3A: A status ruling on a withdrawn product ruling does not apply on and after the date specified in the notice of withdrawal.
3: In section 91FJ(4)(b) or income year for the remainder of the period
4: In section 91FJ(4), at the end of paragraph (b) withdrawal. withdrawal; and
c: A status ruling that has been made on the product ruling continues to apply, for the remainder of the period or income year specified in the product ruling, if the arrangement to which it previously applied was entered into before the date of withdrawal.
5: In section 91FJ(5)(c) or income year The original period
6: After section 91FJ(5)(c)
ca: Any status ruling that applied to the product ruling; and
cb: That the status ruling is also being withdrawn; and .
7: Subsections (1) to (6)
96: Effect of legislative change on binding ruling
1: Section 91G
91G: A binding ruling does not apply from the date a taxation law is repealed or amended to the extent that the repeal or amendment changes the way the taxation law applies in the ruling.
2: Subsection (1)
97: New sections inserted
1: After section 91G section 96
91GA: Applying for ruling on effect of change in legislation
1: A person who applied for a private ruling made under section 91E
2: A person who applied for a product ruling made under section 91F
3: A ruling made under subsection (1) or (2) status ruling
91GB: Commissioner to make status rulings on request
1: The Commissioner must make a status ruling on whether the amendment or repeal of a taxation law that is stated as applying in a private or a product ruling has changed the way that the law applies in the ruling.
2: The Commissioner may make a status ruling on whether the amendment or repeal of a taxation law has changed the way that the law applies in a private or a product ruling whether or not reference was made to that taxation law in the application.
3: The Commissioner may not make a status ruling if—
a: The application is frivolous or vexatious; or
b: The Commissioner considers that the correctness of the private or product ruling would depend on which assumptions were made about a future event or other matter; or
c: The Commissioner considers that it would be unreasonable to make a ruling in view of the resources available to the Commissioner.
91GC: Requirements for status ruling applications
1: An application for a status ruling must be made in the form prescribed by the Commissioner and must—
a: Identify the applicant; and
b: Identify the private or product ruling on which the status ruling is sought; and
c: State the taxation laws that are stated as applying in the private or product ruling that have been amended or repealed; and
d: State any propositions of law that are relevant to the issues raised in the application; and
e: Provide a draft ruling.
2: If the Commissioner considers that it would be unreasonable to require the applicant to comply with any of the requirements in subsection (1)(d) or (1)(e)
91GD: Commissioner may request further information
The Commissioner may at any time request further relevant information from an applicant for a status ruling.
91GE: Right to consultation
Before the Commissioner makes a status ruling, the Commissioner must give the applicant a reasonable opportunity to be consulted if the content of the proposed ruling differs from that requested by the applicant.
91GF: Content of status ruling
A status ruling must identify the private or product ruling on which it is a ruling and state—
a: That it is a status ruling made under section 91GA
b: Whether the amendment or repeal of a taxation law has changed the way that the law applies in the ruling. Anything that does not contain these statements is not a status ruling.
91GG: Notification of status ruling
1: The Commissioner must send a copy of a status ruling to the applicant as soon as practicable after the date on which the ruling is made.
2: In the case of a status ruling on a product ruling, the Commissioner must also—
a: Notify the making of a status ruling by notice in the Gazette
b: Publish the status ruling in a publication of the department.
3: The Commissioner must notify the making of and publish a status ruling as soon as possible but not before the 2-month period specified in section 91FH(3)
91GH: Effect of status ruling
If a person applies a taxation law in accordance with a status ruling, the Commissioner must also apply the taxation law in accordance with the status ruling.
91GI: Effect of minor error on binding ruling
1: The Commissioner does not have to withdraw and reissue a new ruling to correct a typographical or a minor error if the correction does not change the meaning of the ruling.
2: A ruling that is not withdrawn and reissued remains valid.
2: Subsection (1)
98: Regulations
1: In section 91I private rulings and product rulings private, product and status rulings
2: In section 91I(2)(c), at the end of paragraph (c) services. services:
d: Allow the Commissioner to waive, in whole or in part, any fees that are payable.
3: Subsection (1)
4: Subsection (2)
99: New section added
1: After section 91I
91J: Commissioner may not issue ruling to applicant with outstanding debts
1: The Commissioner may refuse to issue a private, a product, or a status ruling to an applicant with an outstanding debt that relates to an earlier binding ruling application.
2: An applicant has an outstanding debt if she or he has not paid, on or before 60 days after the date stated in an invoice sent by Inland Revenue, the amount stated in the invoice.
3: This section applies only to an outstanding debt that first arises on or after 1 June 1999.
2: Subsection (1)
100: Commissioner to make assessments, determinations of net loss, and other determinations
1: In section 92(2)(b) section 138J section 138K
2: Subsection (1)
101: Extension of time bars
1: Section 108B
108B:
1: A taxpayer may, by waiver, extend by up to 6 months the period of time before a time bar referred to in subsection (3)
2: A waiver under subsection (1)
3: Subsection (1)
a: The time bar occurring under section 25 of the Income Tax Act 1976
b: The time bar occurring under section 107A
c: The time bar occurring under section 108 section 29 of the Tax Administration Amendment Act (No 2) 1996
d: The time bar occurring under section 108 section 29 of the Tax Administration Amendment Act (No 2) 1996
e: The time bar occurring under the former section 31 of the Goods and Services Tax Act 1985
f: The time bar occurring under section 108A(1)
g: The time bar occurring under section 108A(2)
2: Subsection (1)
3: Despite subsection (2) (1) section 108B
102: New section inserted
1: After section 120A
120AA: Application of Part
1: This Part does not apply if—
a: A taxpayer has paid qualifying tax in dispute; and
b: The taxpayer has objected, appealed, or stated a case relating to the qualifying tax in dispute paid; and
c: The taxpayer has indicated to the Commissioner, before the date that the Taxation (Accrual Rules and Other Remedial Matters) Act 1999 receives the Royal assent, that repealed sections 120 or 139 of this Act sections 34A or 398 of the Income Tax Act 1976
d: The decision on the objection, appeal, or case stated requires the Commissioner to refund the qualifying tax in dispute paid or requires the taxpayer to pay deferrable tax, as that term was defined before its repeal by section 3 of the Tax Administration Amendment Act (No 2) 1996
2: If subsection (1)
a: Sections 120 or 139 sections 36 and 43 respectively of the Tax Administration Amendment Act (No 2) 1996
b: Sections 34A or 398 of the Income Tax Act 1976
2: Subsection (1)
103: Meaning of unpaid tax and overpaid tax for provisional tax purposes
1: Section 120L subsection (1)
2: If a taxpayer makes a payment and does not specify how the payment is to be applied, the Commissioner must apply the payment towards the provisional tax that is due on an instalment date to which the Commissioner considers the payment relates
3: If the taxpayer makes a payment and specifies that it is made to meet their provisional tax due on an instalment date, the Commissioner must apply the payment towards the provisional tax specified by the taxpayer.
2: Subsection (1)
104: Application of Part 8
1: Section 124A(1)
124A:
1: Despite section 1(2)
a: Every notice of assessment or reassessment issued by the Commissioner under a provision of the Inland Revenue Acts after April 1995 and before 1 October 1996 for a particular item or matter, irrespective of the period to which the assessment or reassessment relates; and
b: Every notice of assessment issued by the Commissioner under a provision of the Inland Revenue Acts on or after 1 October 1996, if before that date, a taxpayer has made a competent objection to a notice of assessment that precedes the notice of reassessment for the same particular item or matter.
2: After section 124A(2)
3: Despite section 1(2) Part IIIA of the Income Tax Act 1976
3: Subsection (1)
4: Subsection (2)
105: Certain rights of objection not conferred
1: Section 125(g)
2: In section 125(j)(iv) 174, 174AA,
3: Subsection (1)
4: Subsection (2)
106: Obligation to pay tax where competent objection lodged
Sections 106 109 repealed 93(5) Taxation (Remedial Matters) Act 1999
107: Powers of Taxation Review Authority on determination of objection or case stated
1: In section 135(2)
a: section 90(1) either section 90(1) or 90AC(1)
b: section 90(6) either section 90(6) or sections 90AC(6) and 90AE
2: Subsection (1)
108: Application of this Part
1: Section 138A(1)
1: Despite section 1(2)
a: Every notice of disputable decision issued by the Commissioner under a provision of the Inland Revenue Acts on or after 1 October 1996, irrespective of the period to which the notice of disputable decision relates; and
b: Any assessment, reassessment, or determination of the Commissioner if a notice of assessment or reassessment to which section 124A(2)(a)
2: Subsection (1)
109: Obligation to pay tax during challenge
Sections 106 109 repealed 93(5) Taxation (Remedial Matters) Act 1999
110: Certain rights of challenge not conferred
1: In section 138E(1)(e)(iv) 174, 174AA,
2: After section 138E(1)(e)
ea: The Commissioner's interpretation of how a taxation law applies to a person, whether or not the person has come into legal existence, and to an arrangement, whether or not a single or a recurring arrangement, as set out in a binding ruling made under Part VA
eb: The Commissioner's interpretation of whether the amendment or repeal of a taxation law has changed the way that the law applies in a private or a product ruling, as set out in a status ruling made under section 91GA .
3: Subsection (1)
4: Subsection (2)
111: Deduction of tax from payments due to defaulters
1: In section 157(10) (e) income tax
f: An amount of unpaid tax subject to Part XA .
2: Subsection (1)
112: New Part inserted
1: After section 173
XA: Tax recovery agreements
173A: Application of Part
This Part applies to tax recovery agreements negotiated between the Government of a territory outside New Zealand and the Government of New Zealand.
173B: Definitions
In this Part— Competent authority Contested act of assistance Contested tax
a: A time limit on a right to object to or to challenge the amount of a tax assessed by the competent authority of the territory outside New Zealand has not expired; or
b: The time limit in paragraph (a)
c: If paragraph (b) Tax recovery agreement
a: A convention or an agreement negotiated to assist in the recovery of unpaid tax due to either or both of the Governments that are parties to the convention or the agreement that has—
i: Been brought into effect by Order in Council under section 173C
ii: Entered into force according to its tenor; or
b: A double tax agreement, to the extent that it provides for the recovery of unpaid tax.
173C: Tax recovery agreements
1: The Governor-General may, by Order in Council, declare that a tax recovery agreement has effect for unpaid tax.
2: A tax recovery agreement has effect—
a: Even if a provision in the agreement is inconsistent with a provision in this Act or in any other enactment; and
b: Subject to this Part.
173D: Taxes that may be recovered
To the extent that the taxes are prescribed in a tax recovery agreement, the agreement may provide for assistance in the recovery of taxes that are imposed by the laws of New Zealand and the territory with which the agreement is negotiated.
173E: Requests for assistance
1: A competent authority may make a request for assistance under a tax recovery agreement.
2: A request for assistance must be accompanied by—
a: Written particulars of—
i: The amount of unpaid tax to which the request for assistance in recovery relates; and
ii: The extent, if any, to which the requesting party considers the unpaid tax is contested; and
b: A declaration made by the applicant's competent authority that the unpaid tax is a tax prescribed in the agreement and that any other conditions in the tax recovery agreement concerning the making of a request have been complied with; and
c: A certified or notarized copy of the instrument that allows enforcement of the unpaid tax in the state of the applicant.
173F: Scope of assistance
1: Subject to subsections (2) and (3)
2: Parts IVA, V, VA, VI, VII, VIII, VIIIA, IX, except sections 143C to 143E, and Part XII, except sections 203 to 205
3: Part XI
173G: Limitations on assistance in recovery
1: The Commissioner must not assist in recovering an amount of unpaid tax that is contested.
2: Subsection (1)
a: Acknowledges that the amount of unpaid tax will no longer be contested; or
b: May leave New Zealand in order to defeat recovery action; or
c: May take steps in relation to the existence or location of the taxpayer's assets that make it more difficult for the Commissioner to recover the unpaid tax; or
d: Is contesting the assessment solely to delay or frustrate recovery action.
3: Assistance must not be given—
a: For an amount of unpaid tax that became uncontested more than 6 years before the tax recovery agreement entered into force in New Zealand; or
b: If the request for assistance is first made more than 15 years after the date on which the unpaid tax became uncontested.
173H: Contested act of assistance
1: This section applies to a contested act of assistance and applies whether or not another remedy is available under the laws of New Zealand or the laws of the other party to a tax recovery agreement.
2: A person that claims to be affected by a contested act of assistance may advise the competent authority of the reasons why the person considers the act is a contested act of assistance.
3: On receipt of a request under subsection (2)
a: Endeavour to resolve with the person the dispute concerning the contested act of assistance; or
b: Refer the request, together with reasons, to the competent authority of the other territory, and endeavour, by mutual agreement, to resolve the dispute.
173I: Rights of appeal
1: A taxpayer may appeal to the District Court on a question of law or fact that arises from the exercise of any authority, discretion, power, provision, or right by the Commissioner or another competent authority under this Part.
2: The District Court may reverse or modify the effect of the authority, discretion, power, provision, or right exercised, or refer the matter back to the Commissioner or the other competent authority for further consideration.
173J: Certificates given by Commissioner
1: The Commissioner may sign a certificate on any matter referred to in subsection (2)
2: A certificate under subsection (1)
a: That the request is made under section 173E
b: That the request complies with this Part.
3: In all proceedings concerning an act of the Commissioner to which section 173F(1) subsection (1)
2: Subsection (1)
113: Section replaced
1: Section 174
174: Application of Part to income years before 1994
1: Despite section 1(2)
2: Despite section 1(2) section 413 of the Income Tax Act 1976
174AA: Power of Commissioner in respect of small amounts of refunds or tax payable
Despite any other provision of this Act or the Income Tax Act 1994
a: The balance of the tax payable is not more than $20; or
b: The tax paid or deducted is $5 or less than the amount of the tax for which the taxpayer is liable.
2: Subsection (1)
114: New section inserted
1: After section 183C
183CA: Cancellation of interest charged on unpaid provisional tax
1: If interest has been charged on unpaid provisional tax under Part VII section 120L(2) and (3)
a: Have their liability to pay the excess interest cancelled; and
b: Have the excess interest, to the extent that the taxpayer has paid it, refunded.
2: A taxpayer's application must be made in writing.
3: Upon receiving an application, the Commissioner must—
a: Cancel the taxpayer's liability to pay the excess interest; and
b: Refund to the taxpayer the excess interest to the extent that it has been paid by the taxpayer.
2: Subsection (1)
115: Payment out of Crown Bank Account
1: Section 185 section 185(1)
2: On the recovery under Part XA
2: Subsection (1)
3: Amendments to Estate and Gift Duties Act 1968
116: Estate and Gift Duties Act 1968
This Part amends the Estate and Gift Duties Act 1968
117: Exemption for base price adjustment under accrual rules in
Income Tax Act 1994
1: Section 35BA
35BA:
1: In this section—
a: Accrual rules section OB 1 of the Income Tax Act 1994
b: Financial arrangement section EH 22(1)(a) of the Income Tax Act 1994
2: A financial arrangement is not included in the dutiable estate of a deceased person to the extent that—
a: A liability under the arrangement is forgiven or remitted, in whole or in part, in the deceased's will or by the deceased when contemplating his or her death; and
b: The forgiveness or remission is taken into account when a person calculates their gross income because it—
i: Reduces the deduction allowed to the person; or
ii: Increases the person's gross income.
2: Subsection (1)
118: Exemption for base price adjustment under accrual rules in
Income Tax Act 1994
1: Section 75B
75B:
1: In this section—
a: Accrual rules section OB 1 of the Income Tax Act 1994
b: Dividend section CF 2(1)(b) of the Income Tax Act 1994
c: Financial arrangement section EH 22(1)(a) of the Income Tax Act 1994
2: The forgiveness or remission of a liability, in whole or in part, under a financial arrangement is not a gift under this Act if and to the extent that the forgiveness or remission must be taken into account under the accrual rules when a person calculates their gross income because it—
a: Reduces the deduction allowed to the person; or
b: Increases the person's gross income.
3: If and to the extent that a transaction is a dividend, the transaction is not a gift under this Act.
2: Subsection (1)
4: Amendments to
Income Tax Act 1976
119: Income Tax Act 1976
This Part amends the Income Tax Act 1976
120: Interpretation
1: In section 64B paragraph (n) of the definition of excepted financial arrangement
o: A loan that is interest free, repayable on demand and denominated in New Zealand dollars, for the lender of the loan only:
p: An employment contract:
q: An interest in a group investment fund:
r: An interest in a partnership or a joint venture:
s: Travellers' cheques:
t: A warranty for goods or services:
u: A hire purchase agreement (as defined in section 2 of the Hire Purchase Act 1971 An arrangement listed in paragraphs (o), (p), (q), (r), (s), (t), and (u) .
2: Subsection (1)
121: Airport operators
1: In section 197A(2) joint venture agreement
a: section 12 of the Civil Aviation Act 1964 section 94 of the Civil Aviation Act 1990
b: Civil Aviation Act 1964 Civil Aviation Act 1990
2: Subsection (1)
5: Amendments to Goods and Services Tax Act 1985
122: Goods and Services Tax Act 1985
This Part amends the Goods and Services Tax Act 1985
123: Zero-rating
1: After section 11(2)(c)
caa: The services are provided to overseas postal organisations for the delivery, in New Zealand, of postal articles mailed outside New Zealand; or
2: Subsection (1)
6: Amendments to Taxation (Simplification and Other Remedial Matters) Act 1998
124: Taxation (Simplification and Other Remedial Matters) Act 1998
1: This Part amends the Taxation (Simplification and Other Remedial Matters) Act 1998
2: In section 64(1) section NC 15(1)(b) of the Tax Administration Act 1994 section 36B
3: Subsection (2)
7: Amendments to Taxation (Tax Credits, Trading Stock, and Other Remedial Matters) Act 1998
125: Taxation (Tax Credits, Trading Stock, and Other Remedial Matters) Act 1998
1: This Part amends the Taxation (Tax Credits, Trading Stock, and Other Remedial Matters) Act 1998
2: Section 22(1)(d)
3: Section 22(5)
4: Subsection (2)
5: Subsection (3)