Student Loan Scheme Amendment Act 2007

1: Title
This Act is the Student Loan Scheme Amendment Act 2007.
2: Commencement
1: Sections 4(2) to (6) (8) 5 to 8 10 to 13 15 17 19 21 27 28 31 32 35 37(2) (3) 39 40 42 43(4) (5) 44(4)
2: Sections 24 30
3: Sections 4(1) (7) 37(1) 45
4: The rest of this Act comes into force on the day after the date on which it receives the Royal assent.
1: Amendments to principal Act
3: Principal Act amended
This Part amends the Student Loan Scheme Act 1992
4: Interpretation
1: Section 2 base interest rate interest adjustment rate 2008-04-01 Section 2
2: Section 2 IRD loan balance IRD loan balance
a: obtained by the borrower under the student loan scheme; and
b: transferred to the Commissioner for collection— and includes any increase under section 103 .
3: The definition of loan balance section 2 , and includes any increase under section 103
4: Section 2 New Zealand based subsection (2) overseas based subsection (3) .
5: The definition of non-resident repayment obligation section 2 non-resident overseas based
6: The definition of repayment obligation section 2
a: omitting a resident New Zealand based
b: omitting a non-resident overseas based
7: Section 2 total interest rate total interest rate section 87 2008-04-01 Section 2
8: Section 2
2: For the purposes of this Act, a borrower is New Zealand based section 38AA
3: For the purposes of this Act, a borrower is overseas based section 38AA
5: Heading to Part 2 amended
The heading to Part 2 borrowers resident in New Zealand New Zealand based borrowers
6: Repayment obligation for resident borrowers
1: The heading to section 14 resident borrowers New Zealand based borrowers
2: Section 14(1) resident New Zealand based
7: New section 14A inserted
The following section is inserted after the heading above section 15
14A: Declaration of world-wide income by certain borrowers
1: This section applies to borrowers who, for the purposes of this Act, are New Zealand based but are not resident.
2: For each tax year and each part tax year in respect of which this section applies to a borrower, that borrower must furnish to the Commissioner details of all amounts of that borrower's gross income that are not treated as having a source in New Zealand under section OE 4 of the Income Tax Act 2004
3: The borrower must furnish the information to the Commissioner at the time when the borrower would have furnished his or her return of income for a tax year under the Tax Administration Act 1994
4: The Commissioner may require the borrower to provide evidence of that borrower's gross income.
8: Commissioner to assess borrower's repayment obligation
1: Section 15 subsection (1)
1: Unless section 33A(1) of the Tax Administration Act 1994
a: his or her return of income for that tax year under the Tax Administration Act 1994
b: details of all amounts of his or her gross income under section 14A(2)
2: Section 15(3) ; or
d: the details of all amounts of a borrower's gross income provided to the Commissioner under section 14A
9: Employer or PAYE intermediary to make repayment deductions
Section 19(2) the employer is aware that if
10: Part 3 substituted
Part 3
3: Collection of repayments from overseas based borrowers
31: Definitions used in this Part
In this Part, unless the context otherwise requires,— opt-out period section 33(1) repayment holiday
32: Overseas based borrowers are entitled to 3-year repayment holiday
1: A borrower who becomes overseas based after 1 April 2007 is entitled to a repayment holiday for a maximum period of 3 years.
2: A borrower is only entitled to a repayment holiday for periods when the borrower is overseas based.
3: A repayment holiday may consist of 1 or more periods of time when a borrower is overseas based, but in total those periods must be for 3 years or less.
4: If a borrower is, at any time, overseas based after that borrower's 3-year repayment holiday has ended, that borrower's repayment obligation must be calculated in accordance with section 34
5: Any 1 borrower is only entitled to receive 1 3-year repayment holiday.
33: Borrowers may choose not to have repayment holiday
1: A borrower may, by giving notice to the Commissioner, choose not to have a repayment holiday for any period during which that borrower is overseas based.
2: A borrower may have 1 or more opt-out periods.
3: An opt-out period may begin from a date prior to the date on which a borrower gives notice to the Commissioner under subsection (1)
4: An opt-out period ends if a borrower becomes New Zealand based.
5: A repayment holiday—
a: ends if an opt-out period begins; and
b: begins when an opt-out period ends (provided that the borrower has, at that time, had a repayment holiday for a total of less than 3 years).
6: If a borrower is overseas based and chooses to have an opt-out period, that borrower's repayment obligation must be calculated in accordance with section 34
7: Notice under subsection (1)
a: by telephone; or
b: in writing; or
c: in any other manner acceptable to the Commissioner.
8: However, the Commissioner may require notice to be given in writing.
34: Repayment obligations of overseas based borrowers
1: This section applies to an overseas based borrower—
a: whose 3-year repayment holiday has ended; or
b: who has chosen to have an opt-out period.
2: A borrower to whom this section applies has the repayment obligations set out in subsections (3) to (5)
3: If the borrower's loan balance is less than $1,000, the borrower's repayment obligation for the first tax year during which this section applies to the borrower is the amount of the borrower's loan balance.
4: If the borrower's loan balance is—
a: $15,000 or less, the borrower's repayment obligation is $1,000 for each full tax year during which the borrower is overseas based:
b: more than $15,000 and less than or equal to $30,000, the borrower's repayment obligation is $2,000 for each full tax year during which the borrower is overseas based:
c: more than $30,000, the borrower's repayment obligation is $3,000 for each full tax year during which the borrower is overseas based.
5: The borrower's repayment obligation for the portion of any tax year (being less than a full tax year) during which the borrower is overseas based is calculated as follows: where—
x: = the number of days in the tax year during which the borrower was overseas based
y: = 1 of the following:
a: $1,000, if the borrower's loan balance is $15,000 or less; or
b: $2,000, if the borrower's loan balance is more than $15,000 and less than or equal to $30,000; or
c: $3,000, if the borrower's loan balance is more than $30,000.
6: If subsection (3) subsections (4) and (5)
7: For the purposes of this section, the amount of a borrower's loan balance is the amount of the loan balance as at the date on which this section first applies to that borrower and then (subject to section 36A
35: Repayment obligations of overseas based borrowers subject to penalties
1: For each tax year in which an overseas based borrower is liable to pay a penalty on the entirety of the borrower's loan balance, that borrower's repayment obligation is zero.
2: For each tax year in which an overseas based borrower's repayment obligation under section 34 penalty free loan balance
3: Nothing in this section affects overdue repayment obligations that were assessed in previous tax years.
4: This section overrides section 34
36: Repayment to be made by instalments
1: A borrower's overseas based repayment obligation for a tax year must be paid by the borrower in 2 equal instalments.
2: The instalments are due and payable in the tax year on—
a: 30 September:
b: 31 March.
36A: Repayment obligation for borrowers who are overseas based for part of tax year
If a borrower is overseas based for part, but not the whole, of a tax year as a result of that borrower becoming New Zealand based during that tax year,—
a: section 34(5) or section 35
i: is not entitled to a repayment holiday; or
ii: has chosen to have an opt-out period; and
b: the borrower's overseas based repayment obligation is payable in such instalments as the Commissioner determines; and
c: Part 2 New Zealand based period
36B: Assessments in year borrower is overseas based
1: As soon as practicable after being notified that, or becoming aware that, a borrower is or will be overseas based, the Commissioner must make an assessment of the amount of that borrower's overseas based repayment obligation for that year.
2: The Commissioner must continue to make an assessment of the amount of a borrower's overseas based repayment obligation for each year, or part of a year, that the borrower remains overseas based.
3: The assessment must be made in accordance with the loan contract and this Act.
4: The Commissioner must give notice to the borrower of the amount assessed as soon as practicable after the making of the assessment.
5: Subsection (4)
11: Borrower to advise Commissioner of absence from New Zealand
1: Section 37(1) 3 6
2: Section 37(1)(b) non-resident overseas based
3: Section 37(2) 3 6
12: Power of Commissioner to grant exemptions to borrowers who do not satisfy 183-day requirement
Section 38AE subsection (3)
3A: The conditions in section 38AEA subsection (1)(b)
13: New section 38AEA inserted
The following section is inserted after section 38AE
38AEA: Conditions to charitable organisation exemption
An applicant under section 38AE(1)(b)
a: provide proof that the work he or she did as a volunteer or for token payment for a charitable organisation was 1 or more of the following:
i: work to relieve poverty, hunger, sickness, or the ravages of war or natural disaster; or
ii: work to improve the economy of a country that is recognised by the United Nations as a developing country; or
iii: work to raise the educational standards of a country that is recognised by the United Nations as a developing country; and
b: provide the Commissioner with the information described in section 14A(2), and section 14A(3) and (4)
14: Conditions to employment or occupation absence exemption
1: Section 38AH(c) subparagraph (i)
i: a source deduction payment, as defined in section OB 2(1) of the Income Tax Act 2004 .
2: The requirement of section 38AH(c)(i) subsection (1)
a: made an application under section 38AE(1)(e)
b: makes an application under section 38AE(1)(e)
15: Power of Commissioner to grant exemption to borrowers undertaking post-graduate study overseas
1: The heading to section 38AJ post-graduate study overseas study at post-graduate or under-graduate level overseas
2: Section 38AJ(1) or under-graduate post-graduate
3: Section 38AJ(2)(a)
a: omitting post-graduate
b: inserting or under-graduate post-graduate
4: Section 38AJ(2)(b) post-graduate
5: Section 38AJ(2) ; and
d: must provide the Commissioner with the information specified in section 14A(2), and section 14A(3) and (4)
6: Section 38AJ(4)
a: inserting or under-graduate post-graduate
b: omitting levels level 7,
16: New section 38AL inserted
The following section is inserted after section 38AK
38AL: Commissioner's discretion for initial 183-day period for new borrowers
1: The Commissioner may at his or her discretion, if the Commissioner considers that it is fair and reasonable to do so, reduce the amount of interest calculated on an eligible borrower's loan balance to zero for interest chargeable during some or all of the period starting on the day on which the borrower first received a student loan and ending 182 days after that day.
2: If the Commissioner reduces the amount of interest calculated on an eligible borrower's loan balance to zero under subsection (1)
3: The Commissioner may specify a start date of 1 April 2006, or any date after that date.
4: In this section,— eligible borrower
a: first received a student loan after 1 April 2006; and
b: was personally absent from New Zealand for a period of 183 days or less during the period starting on the day on which the borrower first received a student loan and ending 182 days after that date first received
17: Headings and sections 38A to 41 repealed
1: The headings above sections 38A 39 40
2: Sections 38A to 41
18: Interest statement
Section 43
3: Subsection (2)
4: If the amount of interest charged is corrected, the Commissioner must give written notice to the relevant borrower as soon as practicable after the amendment.
19: Late payment penalties
1: Section 44(1)(c) a non-resident an overseas based
2: Section 44(2)(a) (b) 2% 1.5%
3: Paragraph (d) amount of the default section 44(3)
a: omitting a non-resident an overseas based
b: omitting non-resident overseas based
4: Paragraph (d) due date section 44(3) a non-resident an overseas based
20: New section 44B inserted
The following section is inserted after section 44A
44B: No interest on portion of loan balance subject to penalty
1: No interest may be charged on any portion of a loan balance on which a borrower is liable to pay a penalty.
2: Subsection (1)
a: despite any provision in a loan contract; and
b: with effect from 1 April 1992.
21: Heading and sections 45A to 45D repealed
The heading above section 45A 45A to 45D
22: Recovery of repayment obligation
Section 46(2) and section 211
23: New section 50 substituted
Section 50
50: Priority of payments
Any payment in respect of a repayment obligation must be off-set—
a: first, against any interest charged; and
b: secondly, against any principal outstanding.
24: New section 51 substituted
Section 51
51: Power of Commissioner in respect of small amounts
1: The Commissioner may refrain from refunding any repayment obligation (or part of a repayment obligation) payable to a borrower, or any repayment deduction (or part of a repayment deduction) payable to an employer or a PAYE intermediary, if—
a: the amount payable to a borrower in any tax year is $5 or less; or
b: the amount payable to an employer or a PAYE intermediary in any period is $5 or less.
2: The Commissioner may refrain from issuing a notice of assessment or refrain from collecting and write off any repayment obligation (or part of a repayment obligation) payable by a borrower, or any repayment deduction (or part of a repayment deduction) payable by an employer or a PAYE intermediary, if—
a: the amount payable by a borrower in any tax year is $20 or less; or
b: the amount payable by an employer or a PAYE intermediary in any period is $20 or less.
3: The Commissioner may refrain from collecting payment of a repayment obligation (or part of a repayment obligation) if that repayment obligation (or part of a repayment obligation)—
a: is more than $20 but less than $333; and
b: has not been paid by the due date (as that term is defined in section 44
4: Any amount that, under subsection (3)
5: This section applies despite anything in this Act. 2007-10-01 Section 51
25: New section 51A inserted
The following section is inserted after section 51
51A: Commissioner may refrain from collecting amounts between $5 and $333
1: The Commissioner may refrain from collecting payment of a repayment obligation (or part of a repayment obligation) if that repayment obligation (or part of a repayment obligation)—
a: is more than $5 but less than $333; and
b: has not been paid by the due date (as that term is defined in section 44
2: Any amount that, under subsection (1)
3: This section applies despite anything in this Act.
4: This section expires on the close of 30 September 2007.
26: Relief from penalty
1: Section 53(1) in writing
2: Section 53 subsection (1)
1A: An application for relief may be made—
a: by telephone; or
b: in writing; or
c: in any other manner acceptable to the Commissioner.
1B: However, the Commissioner may require an application for relief to be made in writing.
27: New sections 54 to 55D substituted
Sections 54 55
54: Borrowers may apply for hardship relief
1: A borrower may apply to the Commissioner for 1 or more of the following:
a: hardship relief for the tax year immediately prior to the current tax year:
b: hardship relief for the current tax year:
c: hardship relief for the next tax year.
2: An application under subsection (1)(c)
3: An application may be made—
a: by telephone; or
b: in writing; or
c: in any other manner acceptable to the Commissioner.
4: However, the Commissioner may require an application to be made in writing.
55: Commissioner may refund or reduce amounts deducted or paid for repayment obligation
If an application has been made under section 54
a: refund any amount that was deducted or paid to meet a repayment obligation in the tax year immediately prior to the current tax year if the Commissioner—
i: is satisfied that payment of that repayment obligation is causing serious hardship to the borrower; or
ii: considers that there are other special reasons that make it fair and reasonable to do so:
b: reduce any amount that must be deducted or paid in order to meet the repayment obligation assessed or to be assessed for the current tax year or the next tax year if the Commissioner—
i: is satisfied that the amount being deducted or paid, or to be deducted or paid, has caused or will cause serious hardship to the borrower; or
ii: considers that there are other special reasons that make it fair and reasonable to do so.
55A: Effect of Commissioner's decision under
section 55(a)
1: If the Commissioner refunds any amount to a borrower under section 55(a)
a: retrospectively decrease that borrower's repayment obligation for the relevant tax year; and
b: refund the whole or part of the portion of the repayment obligation that is the difference in assessment amounts.
2: A refund that is made under this section must be made in the manner required under section 184A of the Tax Administration Act 1994
55B: Effect of Commissioner's decision under
section 55(b)
1: If the Commissioner reduces the amount to be deducted or paid by a borrower under section 55(b)
a: issue to that borrower a special repayment deduction rate certificate that varies the standard deduction rate in accordance with the Commissioner's decision under section 55(b)
b: reduce the percentage payable by that borrower under section 27(1) section 55(b)
c: reduce that borrower's repayment obligation under section 34 section 55(b)
2: If the Commissioner reduces the amount to be deducted from, or paid by, a borrower to zero, section 18
3: If a borrower has given his or her employer notice in accordance with section 18
4: Section NC 14 of the Income Tax Act 2004
55C: Effect of Commissioner's decision under
section 55
1: Any amount that, as a result of a decision under section 55
2: Section 56 or 57 section 56(1)(a) to (e) or section 57(1)
55D: Borrowers must inform Commissioner of change of circumstances and Commissioner may review
1: A borrower who applies for hardship relief under section 54
a: means that any information supplied to the Commissioner under section 54
b: may affect whether or not a borrower would have been, or will continue to be, granted hardship relief under section 55
2: The Commissioner may, at the end of a tax year, review any decision he or she made during that year to grant hardship relief to a borrower.
3: If for any reason the Commissioner considers that the circumstances for the grant of that hardship relief have changed, the Commissioner may do either or both of the following:
a: require the borrower to take any action that is required in order to reverse the effects of the hardship relief that was granted to the borrower:
b: reinstate all or part of the repayment deduction or repayment obligation that would have applied to the borrower if hardship relief had not been granted to the borrower, and require payment of any amount that would have been due during the relevant tax year.
28: Election by non-resident to receive refund or to apply overpayment to loan balance
1: The heading to section 57 non-resident overseas based borrower
2: Section 57(1) non-resident overseas based
29: Repayment obligation paid in excess may be refunded when assessments reopened
Section 58A(1) the tax year ending on 31 March 2006 or any prior tax year any tax year
30: Write-off of loan balance
Section 60(c) $10 $20 2007-10-01 Section 60(c)
31: New section 61 substituted
Section 61
61: Tax year other than 12 months due to change in balance date
If a borrower's net income is for a period other than 12 months as a result of the borrower changing his or her balance date for income tax purposes, for the purpose of calculating the amount of that borrower's repayment obligation, the repayment threshold is calculated as follows: where—
a: is the amount of the repayment threshold referred to in section 2
b: is the number of days in the period.
32: Disclosure of information
1: Section 62(1A) subsection (2)(ab)
2: Section 62(2)(ab)
3: Section 62(2AA)
33: New sections 62A and 62B inserted
The following sections are inserted after section 62
62A: Disclosure of information for information matching purposes
1: The purpose of this section is to facilitate the exchange of information between the Department and the New Zealand Customs Service for the purpose of establishing an information matching programme to assist the Commissioner to verify—
a: borrowers' entitlements to a full interest write-off under section 38AA
b: whether borrowers are New Zealand based or overseas based for the purposes of this Act:
c: whether borrowers are resident or non-resident for the purposes of this Act.
2: For the purpose of this section, the Commissioner may provide to the chief executive of the New Zealand Customs Service any of the following information that is held by the Department:
a: a borrower's name or any other name by which a borrower is known:
b: a borrower's date of birth:
c: a borrower's tax file number.
3: The Commissioner and the chief executive of the New Zealand Customs Service may, for the purpose of this section, determine by written agreement between them—
a: the frequency with which information may be supplied; and
b: the form in which information may be supplied; and
c: the method by which information may be supplied.
4: Subsection (2)
62B: Power of Commissioner to access arrival or departure information
In accordance with, and for the purpose set out in, section 280I of the Customs and Excise Act 1996
34: Objection to decision concerning grant of exemption
Section 65A is amended by adding the following paragraphs:
e: not to reduce the amount of interest calculated on an eligible borrower's loan balance under section 38AL
f: specifying the start and end dates for the period for which the amount of interest calculated on an eligible borrower's loan balance is reduced to zero under section 38AL(2)
i: not fair and reasonable; or
ii: erroneous.
35: Section 66A repealed
Section 66A
36: Heading to Part 7 amended
The heading to Part 7 , amendments to other Acts, and transitional provisions and miscellaneous matters
37: Regulations
1: Section 87(1) paragraphs (ab) (ac)
ab: specifying a formula or methodology, and other requirements, in accordance with which the total interest rate must be set or reset for the purposes of this Act:
ac: determining, in accordance with the formula or methodology and requirements specified under paragraph (ab) . 2008-04-01 Section 87(1)
2: Section 87(1)(ba)
3: Section 87(4) or subsection (1)(ba)
38: New section 88 inserted
The following section is inserted after section 87
88: Full interest write-offs, base interest write-offs, and interest reductions validated
1: This section applies to a borrower whose loan balance was treated by the Commissioner as being zero or less on 13 November 2006 and who, in relation to that loan balance, received 1 or more of the following in any tax year that ended prior to 1 April 2006:
a: a full interest write-off as described in section 38C section 17 of the Student Loan Scheme Amendment Act 2007
b: a base interest write-off as described in section 39(2) section 17 of the Student Loan Scheme Amendment Act 2007
c: an interest reduction as described in section 40(2) section 17 of the Student Loan Scheme Amendment Act 2007
2: In relation to a borrower to whom this section applies,—
a: the full interest write-off described in subsection (1)(a)
b: the base interest write-off described in subsection (1)(b)
c: the interest reduction described in subsection (1)(c)
3: This section does not affect any loan obtained by the borrower under the student loan scheme after 13 November 2006.
4: This section applies despite anything in any other enactment or in a loan contract.
39: Headings and sections 89 to 102 repealed
1: The heading above section 89 section 89
2: Sections 89 to 102
40: New Parts added
The following Parts are added:
8: 2007/08 transitional provisions for fresh start for certain borrowers
89: Interpretation
In this Part, unless the context otherwise requires,— amnesty application date section 93(1)(a)(i) amnesty condition sections 94 to 97 and 100 late payment penalties
a: means any penalty that was charged under section 44 section 91
b: includes any penalty that would have been charged under section 44 section 90 non-resident repayment obligation Part 3 Part 3 section 10 of the Student Loan Scheme Amendment Act 2007 off-set old amnesty sections 45A to 45D section 21 of the Student Loan Scheme Amendment Act 2007 old repayment obligation section 90 resident repayment obligation Part 2 Fresh start for certain non-resident borrowers
90: No need to issue non-resident repayment obligations for period before 1 April 2007
The Commissioner is not obliged to issue any new non-resident repayment obligation in relation to a borrower for any period before 1 April 2007 if the Commissioner has not previously issued a non-resident repayment obligation in relation to that borrower for that period.
91: Penalties cancelled, and interest imposed, for certain non-resident borrowers
1: This section applies to a borrower who was—
a: non-resident on 31 March 2006; and
b: in arrears in respect of all or part of an old repayment obligation as at 1 April 2007.
2: All old repayment obligations and all associated penalties of a borrower to whom this section applies are reduced to zero, to the extent that the old repayment obligations or the associated penalties are unpaid as at 1 April 2007.
3: The amount that was to be paid in respect of the old repayment obligations is subject to interest from the date that the old repayment obligations were (or would have been) originally due at the total interest rate that applied over the period of non-payment of those obligations on the daily amount outstanding.
4: For the avoidance of doubt, the amount that was to be paid in respect of the old repayment obligations remains part of the borrower's loan balance, and that loan balance remains outstanding and due for repayment in accordance with subsequent repayment obligations assessed by the Commissioner. Examples Example 1: Lenore Lenore has a loan balance on 1 April 2005 of $15,000. Lenore was issued with non-resident assessments of $1,997 for the 2005–06 tax year and $1,919 for the 2006–07 tax year, which she has failed to pay. The 2005–06 assessment ceased to be subject to standard interest (7% for the 2005–06 tax year) and instead became subject to compounding late payment penalties of 2% per month from 1 April 2006. The 2006–07 assessment ceased to become subject to standard interest (6.9% for the 2006–07 tax year) 1 year later on 1 April 2007. Her total late payment penalties on 31 March 2007 are $536 and her loan balance is $17,555. On 1 April 2007 her overdue debt is zero and her loan balance is reduced by $398 (penalties of $536 less interest of $138 charged in place of penalties) to $17,157. Example 2: Keith Keith left New Zealand on 31 March 2005 with a loan balance of $20,000. The Commissioner was not aware that Keith was a non-resident and therefore did not issue non-resident assessments while Keith was overseas. On 1 April 2007 the Commissioner becomes aware that Keith is a non-resident and has been since 1 April 2005. The Commissioner is not required to make non-resident repayment obligation assessments for tax years prior to 1 April 2007. Keith has not made any repayments while overseas and his loan balance is $22,877 on 1 April 2007, including compounding interest. New amnesty
92: Application of sections 93 to 105
1: Sections 93 to 105
a: non-resident on 31 March 2006; and
b: in arrears in respect of all or part of an old repayment obligation as at 1 April 2007.
2: However, sections 93 to 105
93: Borrowers whose loan balance is not increased under section 103
1: Section 103
a: either—
i: the Commissioner receives an amnesty application (in any form or manner acceptable to the Commissioner) by or on behalf of that borrower on or after 1 April 2007 and before the close of 31 March 2008; or
ii: the old amnesty applies to the borrower and the borrower is not in breach of the condition of the old amnesty as at 1 April 2007; and
b: the borrower meets the relevant amnesty condition.
2: To avoid doubt, a borrower to whom the old amnesty applies and who is in breach of a condition of that amnesty as at 1 April 2007 may make an amnesty application under subsection (1)(a)(i)
94: Amnesty condition for borrowers who apply for amnesty after 31 March 2007
The amnesty condition for a borrower referred to in section 93(1)(a)(i)
a: give an undertaking to the Commissioner that he or she will pay to the Commissioner the amount referred to in paragraph (b)
b: in accordance with that undertaking, pay the following amount to the Commissioner:
i: $2,000, if the borrower's loan balance as at the amnesty application date is $15,000 or less:
ii: $4,000, if the borrower's loan balance as at the amnesty application date is more than $15,000 and less than or equal to $30,000:
iii: $6,000, if the borrower's loan balance as at the amnesty application date is more than $30,000.
95: Payment arrangements if amnesty application date is between 1 April 2007 and 31 August 2007
1: This section applies to a borrower whose amnesty application date is between 1 April 2007 and the close of 31 August 2007.
2: The amount in section 94
3: The amount in section 94
a: any overseas based repayment obligation to which the borrower may otherwise be liable, to the extent that the amount is received by the Commissioner in the tax year ending 31 March 2008 or 31 March 2009; and
b: any repayment holiday the borrower may have had under section 107
96: Payment arrangements if amnesty application date is between 1 September 2007 and 29 February 2008
1: This section applies to a borrower whose amnesty application date is between 1 September 2007 and the close of 29 February 2008.
2: The amount in section 94
3: The amount in section 94
a: applies instead of any overseas based repayment obligation to which the borrower may otherwise be liable, to the extent that the amount is received by the Commissioner in the tax years ending 31 March 2008 and 31 March 2009; and
b: is off-set against any overseas based repayment obligation to which the borrower may otherwise be liable, to the extent that the amount is received by the Commissioner in the tax year ending 31 March 2010; and
c: applies instead of any repayment holiday the borrower may have had under section 107
97: Payment arrangements if amnesty application date is in March 2008
1: This section applies to a borrower whose amnesty application date is in March 2008.
2: The amount in section 94
3: The amount in section 94
a: any overseas based repayment obligation to which the borrower may otherwise be liable, to the extent that the amount is received by the Commissioner in either the tax year ending 31 March 2009 or the tax year ending 31 March 2010; and
b: any repayment holiday the borrower may have had under section 107
4: For the tax year ending 31 March 2008, the borrower's repayment obligation is reduced to zero.
98: Commissioner may reduce instalments if significant financial hardship
The Commissioner may reduce any instalment to be paid by a borrower under any of sections 94 to 97 section 57D(4)
99: Relationship with New Zealand based repayment obligations
An amount paid by a borrower under section 94
100: Amnesty condition for people who applied for old amnesty before 1 April 2007
The amnesty condition for a borrower referred to in section 93(1)(a)(ii) sections 94 to 99
a: in a way that, in the opinion of the Commissioner, gives credit for the extent to which the borrower has complied with the conditions of the old amnesty; and
b: with such other modifications as may be necessary.
101: What happens if amnesty condition breached
If the Commissioner is satisfied that a borrower has breached the relevant amnesty condition,—
a: section 102
b: in any other case, the amnesty ceases to apply to the borrower and the Commissioner must apply section 103
102: One time opportunity to correct amnesty condition breach
1: This section applies if the Commissioner is satisfied that—
a: a borrower has breached the relevant amnesty condition; and
b: this is the first breach of that condition by that borrower.
2: If this section applies, the Commissioner must give the borrower written notice of—
a: the breach of the amnesty condition by the borrower; and
b: the action that must be taken by the borrower to remedy that breach; and
c: the date by which the breach must be remedied, which must be the date that is 30 days after the date of the Commissioner's notice; and
d: the fact that the Commissioner is exercising a discretion that can only be used once in relation to the borrower.
3: If the borrower remedies the breach in accordance with the terms of the Commissioner's notice, the Commissioner must treat the borrower as if the borrower has met all of his or her obligations under sections 93 to 103
103: Increase to loan balance if borrower does not come under amnesty or if amnesty condition breached
1: If a borrower does not apply for an amnesty before 1 April 2008, the borrower's loan balance is increased by an amount equal to 5% of the borrower's loan balance as at 31 March 2008, including any interest compounded as at that date.
2: However, if the Commissioner considers that the amount in subsection (1) subsection (1)
3: If the borrower fails to comply with the relevant amnesty conditions, the borrower's loan balance is increased, on 31 March following the breach, by an amount equivalent to the lesser of the amounts in subsections (1) and (2)
104: Objection to decisions concerning penalty amnesty
A borrower may challenge a decision of the Commissioner—
a: not to take the actions set out in section 102(2) and (3)
b: under section 103
105: Commissioner must apply rest of Act accordingly
The Commissioner must apply this Act to borrowers to whom sections 93 to 105 section 50 section 94
9: Other transitional provisions
Repayment holiday entitlements for borrowers who are overseas based on 1 April 2007
106: Full repayment holiday entitlement for borrowers who are overseas based on 1 April 2007 and compliant
1: This section applies to a borrower who, on 1 April 2007,—
a: is overseas based; and
b: is not in arrears in respect of all or part of an old repayment obligation (as defined in section 89
2: A borrower to whom this section applies is entitled to a repayment holiday for a maximum period of 3 years, and sections 31 to 36B
107: Restricted repayment holiday entitlements for borrowers who are overseas based on 1 April 2007 and non-compliant
1: This section applies to a borrower who—
a: is overseas based on 1 April 2007; and
b: but for sections 90 and 91 section 89
2: A borrower who, as at 1 April 2007, has been non-resident for a continuous period of more than 364 days but less than 2 years is entitled to a repayment holiday for a maximum period of 2 years, and sections 31 to 36B
3: A borrower who, as at 1 April 2007, has been non-resident for a continuous period of 2 years or more, but less than 3 years, is entitled to a repayment holiday for a maximum period of 1 year, and sections 31 to 36B
4: A borrower who, as at 1 April 2007, has been non-resident for a continuous period of 3 years or more is not entitled to a repayment holiday under section 32 sections 34 to 36
108: Restricted repayment holiday entitlements for borrowers who are overseas based on 1 April 2007 and do not comply with amnesty conditions
1: This section applies to a borrower who—
a: was overseas based on 1 April 2007; and
b: applied to come under the amnesty under section 93
2: The restricted repayment holidays in section 107(2) to (4)
3: Any amounts that a borrower has paid in accordance with section 94
a: after his or her restricted repayment holiday under subsection (2)
b: while opting out of a repayment holiday in accordance with section 33
109: Interrelationship of
sections 31 to 36B, Part 8, and sections 107 and 108
1: The restricted repayment holidays in section 107(2) to (4)
2: A borrower to whom section 107 or section 108 sections 31 to 36B
3: However, any repayment holiday that borrower has already had under section 107 or section 108
4: The amnesty conditions in Part 8 section 107
110: Full repayment holiday entitlement for borrowers who meet amnesty conditions
1: This section applies to a borrower who—
a: was overseas based on 1 April 2007; and
b: has, since 1 April 2007, become a compliant borrower.
2: For the purposes of subsection (1) compliant borrower section 93
3: A borrower to whom this section applies may apply to the Commissioner for a full repayment holiday when he or she becomes a compliant borrower.
4: An application may be made by the borrower, or on behalf of the borrower,—
a: by telephone; or
b: in writing; or
c: in any other manner acceptable to the Commissioner.
5: However, the Commissioner may require an application to be made in writing.
6: If the Commissioner grants a borrower's application for a full repayment holiday, that borrower is entitled to a repayment holiday of up to 3 years, and sections 31 to 36B
111: Full repayment holiday entitlement for borrowers who meet amnesty conditions and do not apply under
section 110
1: This section applies to a borrower who—
a: was overseas based on 1 April 2007; and
b: has, since 1 April 2007, become a compliant borrower (as defined in section 110(2)
c: does not make an application to the Commissioner under section 110(3)
2: A borrower to whom this section applies and who subsequently becomes New Zealand based is entitled to a repayment holiday of up to 3 years in accordance with sections 31 to 36B Application of Tax Administration Act 1994
112: Application of repealed provisions of
Tax Administration Act 1994 Where a provision of this Act (a relevant provision
a: refers to a provision of the Tax Administration Act 1994 Tax Administration Amendment Act (No 2) 1996
b: incorporates the repealed provision for any purpose to give effect to the relevant provision,— the repealed provision must be treated as continuing in effect for the purpose of giving effect to the relevant provision.
2: Amendments to other enactments
1: Amendments to other Acts
41: Customs and Excise Act 1996 amended
The Customs and Excise Act 1996 section 280F
280G: Defined terms for
sections 280H and 280I In sections 280H and 280I borrower section 2 of the Student Loan Scheme Act 1992 Commissioner section 3(1) of the Tax Administration Act 1994 Department identifying information section 62A(2) of the Student Loan Scheme Act 1992 officer of the Department section 3(1) of the Tax Administration Act 1994
280H: Disclosure of arrival and departure information for purposes of Student Loan Scheme Act 1992
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 verify—
a: borrowers' entitlements to a full interest write-off under section 38AA of the Student Loan Scheme Act 1992
b: whether borrowers are New Zealand based or overseas based for the purposes of that Act:
c: whether borrowers are resident or non-resident for the purposes of that Act.
2: For the purpose of this section, the Commissioner may supply any identifying information to the Chief Executive.
3: If, in relation to any borrower, identifying information is supplied in accordance with subsection (2)
4: If the Customs has arrival or departure information relating to a borrower, 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 borrower's name:
b: the borrower's date of birth:
c: the borrower's tax file number:
d: the time and date on which the borrower arrived in, or, as the case may be, departed 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; and
b: the form in which information may be supplied; and
c: the method by which information may be supplied.
280I: Direct access to arrival and departure information for purposes of Student Loan Scheme Act 1992
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 verify—
a: borrowers' entitlements to a interest under section 38AA of the Student Loan Scheme Act 1992
b: whether borrowers are New Zealand based or overseas based for the purposes of that Act:
c: whether borrowers are resident or non-resident for the purposes of that Act:
d: for the purposes of that Act, whether borrowers are in New Zealand.
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 pre-selected borrowers who are of interest to the Commissioner; and
b: must not search for—
i: any information other than arrival or departure information; or
ii: any information about a person who is not a borrower.
4: The Commissioner must take all reasonable steps to ensure that—
a: only persons who have had 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
42: Education Act 1989 amended
Section 307C Education Act 1989
43: Privacy Act 1993 amended
1: This section amends the Privacy Act 1993
2: Schedule 3 Student Loan Scheme Act 1992 Section 62A
3: The item relating to the Customs and Excise Act 1996 Schedule 3 Sections 280 to 280D Sections 280 to 280D and 280H
4: The item relating to the Education Act 1989 Schedule 3 307C,
5: The item relating to the Tax Administration Act 1994 Schedule 3 85D,
44: Tax Administration Act 1994 amended
1: This section amends the Tax Administration Act 1994
2: Paragraph (c) tax section 3(1) , any interest charged on a loan balance (as that term is defined in the Student Loan Scheme Act 1992 Revenue Acts
3: Section 81(4) paragraph (g)
gb: communicating to the chief executive of the New Zealand Customs Service under section 62A of the Student Loan Scheme Act 1992 subsection (2) of that section subsection (1) of that section
4: Section 85D
5: Section 87(4) paragraph (d)
db: where it is given by any person referred to in section 81(4)(gb) .
6: Section 87(5)(a)(i) (gb), (g),
2: Amendments to regulations
45: Student Loan Scheme (Interest Rates Formulas) Regulations 2006 amended
The Student Loan Scheme (Interest Rates Formulas) Regulations 2006 regulations 5 6 2008-04-01 Regulation 5 Regulation 6