Taxation (Budget Measures) Act 2010

1: Title
This Act is the Taxation (Budget Measures) Act 2010.
2: Commencement
1: This Act comes into force on 20 May 2010, except as provided in this section.
2: In Part 1 sections 3 41 44 54
3: In Part 2 sections 57 58
a: the subsections (1) of the sections are treated as coming into force on 1 April 2010:
b: the subsections (2) of the sections come into force on 1 April 2011.
4: In Part 3
a: section 92
b: sections 79(1), (3), and (4) 84 96(2) and (4)
c: section 100
d: section 94(2), (4), (5), and (6)
e: sections 77(4) to (6) 81(3) to (6) 82 83 85 to 91 93 96(5), (7), (8), and (9) 97 98 99
f: sections 95 96(6)
1: Personal tax cuts, company tax cuts, and GST rate increase: 1 October 2010 start
Amendments to Income Tax Act 2007
3: Income Tax Act 2007
Sections 4 to 40 Income Tax Act 2007 2010-10-01 Income Tax Act 2007 ss 4–40
4: Withdrawals
Section 4 repealed 7 September 2010 section 209 Taxation (Annual Rates, Trans-Tasman Savings Portability, KiwiSaver, and Remedial Matters) Act 2010
5: Attributed income of certain investors in multi-rate PIEs
1: In section CX 56(1)(b) tax rate notified under section HM 60 (Notified rates) notified investor rate
2: In section CX 56 notified investor rate
6: Calculation of tax liability or tax credit of multi-rate PIEs
1: In section HM 47(4)(a)(i) section HM 60 relating to the investor for the period section HM 58 or HM 60, as applicable, that relates to the investor for each day for the period
2: In section HM 47(4)(a)(ii) 30 28
7: Use of foreign tax credits by zero-rated and certain exiting investors
1: In section HM 52(3)(b) tax year tax year or exit period, as applicable
2: In section HM 52(3)(b)(i) for the attribution period before their exit period that the PIE would have used had the period not been an exit period
8: Section HM 58 replaced
Section HM 58
HM 58: Transition of rate for certain investors
When this section applies
1: This section applies to a multi-rate PIE in relation to a person who is an investor in the PIE, and the person has, on 30 September 2010, a notified investor rate of 12.5%, 21%, or 30%. Rate applying on and after 1 October 2010
2: On and after 1 October 2010, the person's notified investor rate is––
a: 10.5%, if it was 12.5% on 30 September 2010:
b: 17.5%, if it was 21% on 30 September 2010:
c: 28%, if it was 30% on 30 September 2010. Exception: new notified rate
3: Subsection (2) does not apply if the person advises the PIE of a different notified investor rate. multi-rate PIE, notified investor rate, notify .
9: Notified investor rates
1: Section HM 60(3) Application of rate
3: For an investor for an income year, a multi-rate PIE must apply the most recent notified investor rate to every day in every period for the income year. However, for the 2010–11 income year, the most recent notified investor rate on or after 1 October 2010 is applied only to every day on or after 1 October 2010. For a day before 1 October 2010, the multi-rate PIE must apply the notified investor rate that would have applied ignoring the Taxation (Budget Measures) Act 2010.
2: In section HM 60(6) 30 28
10: What this subpart does
In section ML 1(1) redundancy payment redundancy payment before 1 October 2010
11: Tax credit for redundancy payments
In section ML 2(1) redundancy payment has a tax credit of an amount equal to 6 cents for every complete dollar of total redundancy payments derived by them redundancy payment before 1 October 2010 has a tax credit of an amount equal to 6 cents for every complete dollar of total redundancy payments derived by them before 1 October 2010
12: ICA benchmark dividend rules
In section OB 61(4) This subsection is modified by section OZ 9
13: FDPA benchmark dividend rules
In section OC 28(4) This subsection is modified by section OZ 9
14: Section OZ 7 replaced
Section OZ 7
OZ 7: Memorandum accounts in transitional period
Unless the context otherwise requires, sections OZ 8 to OZ 15 transitional period
a: beginning the first day of a person's 2011–12 income year; and
b: ending on 31 March 2013. income year .
15: Attaching imputation credits and FDP credits: maximum permitted ratio
In section OZ 8(2) 33 30
16: Benchmark dividends: ratio change
1: In section OZ 9(1)(c)(ii) 33/67 30/70
2: In section OZ 9(3)(b) 30/70 28/72
17: Modifying ratios for imputation credits and FDP credits
1: In section OZ 10(1)(a) 1 October 2007 to 31 March 2010 1 October 2010 to 31 March 2013
2: In section OZ 10(1)(b)(i) to (iii)
a: 30/70 28/72
b: 33/67 30/70
3: In section OZ 10(2) 33/67 30/70
18: Tax credits for imputation credits and FDP credits
1: Section OZ 11(1)(a)
a: a person—
i: derives a dividend in the transitional period, if the person is a new company tax rate person that is not a multi-rate PIE:
ii: derives a dividend in the period from 1 October 2010 to 31 March 2013, if the person is a new company tax rate person that is a multi-rate PIE; and .
2: In section OZ 11(1)(b)(i) to (iii)
a: 30/70 28/72
b: 33/67 30/70
3: In section OZ 11(1)(c) new tax rate person new company tax rate person
4: In section OZ 11(2) 0.30 0.28
5: In section OZ 11(4) 0.30 0.28
6: In section OZ 11 multi-rate PIE new company tax rate person
19: Tax credits for non-resident investors
1: In section OZ 12(1)(b)(i) and (ii)
a: 30/70 28/72
b: 33/67 30/70
2: In section OZ 12(2)
a: 33/67 30/70
b: 7/17 as 67/187 24/53 as 7/17
3: In section OZ 12(3)
a: 33/67 30/70
b: 7/17 as 67/187 24/53 as 7/17
4: In section OZ 12(4) 33/67 30/70
5: In section OZ 12(5) 33 30
20: Fully credited dividends: modifying actual ratio
1: In section OZ 13(1)
a: 30/70 28/72
b: 33/67 30/70
2: In section OZ 13(2) 30/70 28/72
21: Dividends from qualifying companies
In section OZ 14(2) 0.33 0.30
22: Attaching imputation credits and notional distributions: modifying amounts
In section OZ 15
a: in subsection (2), 33 30
b: in subsection (3), 33 30
c: in subsection (4), 33 30
d: in subsection (5), 33 30
23: BETA reductions
1: In section OZ 16(1)
a: in paragraph (a), 2008–09 2011–12
b: in paragraph (b),––
i: 2008–09 2011–12
ii: 2007–08 2010–11
2: In section OZ 16(2) 30/33 28/30
24: CTRA reductions
1: In section OZ 17(1)
a: in paragraph (a), 2008–09 2011–12
b: in paragraph (b),––
i: 2008–09 2011–12
ii: 2007–08 2010–11
2: In section OZ 17(2) 30/33 28/30
25: Methods for calculating provisional tax liability
In section RC 5(4) Sections RZ 3 and RZ 5B (which relate to tax rate changes) modify Section RZ 3
26: GST ratio method
In section RC 8(9) Sections RZ 4 and RZ 5C (which relate to tax rate changes) modify Section RZ 4
27: Calculating amount of instalment under standard and estimation methods
In section RC 10(3)(a)
a: in subparagraph (i), sections RZ 5 and RZ 5B (which relate to tax rate changes) section RZ 5
b: in subparagraph (ii), sections RZ 5 and RZ 5B section RZ 5
28: Calculating amount of instalment using GST ratio
In section RC 11(4) Sections RZ 4 and RZ 5C (which relate to tax rate changes) modify Section RZ 4
29: Sections RZ 3 to RZ 5C replaced
Sections RZ 3 to RZ 5C
RZ 3: Standard method: 2010–11 to 2012–13 income years
When this section applies
1: This section applies to the calculation of a person's provisional tax liability, when section RC 5
a: for instalments payable on or after 1 October 2010 for the 2010–11 income year and for instalments for the 2011–12 and 2012–13 income years, if the person is a new personal tax rate person:
b: for instalments payable for the 2011–12 and 2012–13 income years, if the person is a new company tax rate person. Standard method modified: for 5% uplift
2: The standard method under section RC 5(2) is modified so that––
a: for instalments payable on or after 1 October 2010 for the 2010–11 income year, instead of using 105%, the amount of provisional tax payable is calculated using 95%, if the person is a new personal tax rate person:
b: for the 2011–12 income year, instead of using 105%, the amount of provisional tax payable is calculated using––
i: 95%, if the person is a new personal tax rate person; or
ii: 100%, if the person is a new company tax rate person. Standard method modified: for 10% uplift
3: The standard method under section RC 5(3) is modified so that––
a: for instalments payable on or after 1 October 2010 for the 2010–11 income year, instead of using 110%, the amount of provisional tax payable is calculated using 95%, if the person is a new personal tax rate person:
b: for the 2011–12 income year, instead of using 110%, the amount of provisional tax payable is calculated using––
i: 95%, if the person is a new personal tax rate person; or
ii: 105%, if the person is a new company tax rate person:
c: for the 2012–13 income year, instead of using 110%, the amount of provisional tax payable is calculated using––
i: 100%, if the person is a new personal tax rate person; or
ii: 105%, if the person is a new company tax rate person. amount, income year, new company tax rate person, new personal tax rate person, pay, provisional tax
RZ 4: GST ratio method: 2010–11 to 2013–14 income years
When this section applies
1: This section applies to the calculation of a person's provisional tax liability, when section RC 8 (GST ratio method) applies and requires an amount of residual income tax or an assessment of income tax for the calculation of the GST ratio,––
a: for instalments payable on or after 1 October 2010 for the 2010–11 income year and for instalments for the 2011–12, 2012–13, and 2013–14 income years, if the person is a new personal tax rate person:
b: for instalments payable for the 2011–12, 2012–13, and 2013–14 income years, if the person is a new company tax rate person.
2: The GST ratio method under section RC 8 is modified so that––
a: for instalments payable on or after 1 October 2010 for the 2010–11 income year, and for the 2011–12 income year, if the person is a new personal tax rate person,––
i: the amount of residual income tax or the amount of an assessment of income tax for the preceding year, as applicable, is reduced by multiplying the amount by 0.90:
ii: the amount of residual income tax or the amount of an assessment of income tax for the tax year before the preceding year or the transitional year, as applicable, is reduced by multiplying the amount by 0.85:
iii: the amount of residual income tax or the amount of an assessment of income tax for the year that is 2 years before the preceding year or the transitional year, as applicable, is reduced by multiplying the amount by 0.80:
b: for instalments payable for the 2012–13 income year, if the person is a new personal tax rate person,––
i: the amount of residual income tax or the amount of an assessment of income tax for the tax year before the preceding year or the transitional year, as applicable, is reduced by multiplying the amount by 0.90:
ii: the amount of residual income tax or the amount of an assessment of income tax for the year that is 2 years before the preceding year or the transitional year, as applicable, is reduced by multiplying the amount by 0.85:
c: for instalments payable for the 2013–14 income year, if the person is a new personal tax rate person, the amount of residual income tax or the amount of an assessment of income tax for the year that is 2 years before the preceding year or the transitional year, as applicable, is reduced by multiplying the amount by 0.90:
d: for instalments payable for the 2011–12 income year, if the person is a new company tax rate person,––
i: the amount of residual income tax or the amount of an assessment of income tax for the preceding year, as applicable, is reduced by multiplying the amount by 0.95:
ii: the amount of residual income tax or the amount of an assessment of income tax for the tax year before the preceding year or the transitional year, as applicable, is reduced by multiplying the amount by 0.95:
iii: the amount of residual income tax or the amount of an assessment of income tax for the year that is 2 years before the preceding year or the transitional year, as applicable, is reduced by multiplying the amount by 0.95:
e: for instalments payable for the 2012–13 income year, if the person is a new company tax rate person,––
i: the amount of residual income tax or the amount of an assessment of income tax for the tax year before the preceding year or the transitional year, as applicable, is reduced by multiplying the amount by 0.95:
ii: the amount of residual income tax or the amount of an assessment of income tax for the year that is 2 years before the preceding year or the transitional year, as applicable, is reduced by multiplying the amount by 0.95:
f: for instalments payable for the 2013–14 income year, if the person is a new company tax rate person, the amount of residual income tax or the amount of an assessment of income tax for the year that is 2 years before the preceding year or the transitional year, as applicable, is reduced by multiplying the amount by 0.95. amount, assessment, GST ratio, income tax, income year, new company tax rate person, new personal tax rate person, pay, provisional tax, residual income tax
RZ 5: Calculating amounts under standard method: 2010–11 to 2012–13 income years
When this section applies
1: This section applies to the calculation of a person's provisional tax liability, when section RC 10 (Calculating amount of instalment under standard and estimation methods) applies,––
a: for instalments payable on or after 1 October 2010 for the 2010–11 income year and for instalments for the 2011–12 and 2012–13 income years, if the person is a new personal tax rate person:
b: for instalments payable for the 2011–12 and 2012–13 income years, if the person is a new company tax rate person. Calculation modified: for 5% uplift
2: In the calculation of the amount of an instalment, in section RC 10(3)(a), subparagraph (i) is modified so that––
a: for instalments payable on or after 1 October 2010 for the 2010–11 income year, instead of using a 5% uplift, a 5% reduction is used, if the person is a new personal tax rate person:
b: for the 2011–12 income year, instead of using a 5% uplift, the amount of provisional tax payable is calculated using––
i: a 5% reduction, if the person is a new personal tax rate person; or
ii: no uplift, if the person is a new company tax rate person. Calculation modified: for 10% uplift
3: In the calculation of the amount of an instalment, in section RC 10(3)(a), subparagraph (ii) is modified so that––
a: for instalments payable on or after 1 October 2010 for the 2010–11 income year, instead of using a 10% uplift, a 5% reduction is used, if the person is a new personal tax rate person:
b: for the 2011–12 income year, instead of using a 10% uplift, the amount of provisional tax payable is calculated using––
i: a 5% reduction, if the person is a new personal tax rate person; or
ii: a 5% uplift, if the person is a new company tax rate person:
c: for the 2012–13 income year, instead of using a 10% uplift, the amount of provisional tax payable is calculated using––
i: no uplift, if the person is a new personal tax rate person; or
ii: a 5% uplift, if the person is a new company tax rate person. amount, income year, new company tax rate person, new personal tax rate person, pay, provisional tax .
30: Definitions
1: This section amends section YA 1
2: The definition of new personal tax rate person new company tax rate person
a: means a person who uses a 28% basic tax rate for the 2011–12 income year or later income years:
b: includes, for the purposes of subpart OZ
c: does not include, for the purposes of subpart RZ new personal tax rate person .
3: The definition of new tax rate person
4: In the definition of notified investor rate section HM 60 (Notified rates) section HM 60 (Notified investor rates) or a notified investor rate under section HM 58
5: In the definition of old company tax rate 33 30
31: Schedule 1—Basic tax rates: income tax, ESCT, RSCT, RWT, and attributed fringe benefits: part D, table 1
Schedule 1 Table 1 Row ESCT rate threshold amount Tax rate 1 $0 – $16,800 0.105 2 $16,801 – $57,600 0.175 3 $57,601 – $84,000 0.300 4 $84,001 upwards 0.330 How to use this table:Find the range in the second column for the last dollar of the amount of salary or wages under section RD 69(1)
32: Schedule 1—Basic tax rates: income tax, ESCT, RSCT, RWT, and attributed fringe benefits: part D, table 2
Schedule 1 Table 2 Row Conditions Payment rate 1 The payer of the interest has not been supplied with the tax file number of a person who is paid the interest. 0.330 2 The payer of the interest— (a) has been supplied with the tax file number of a person who opens a new account after 31 March 2010 and who is paid the interest; and (b) has not received a payment rate election from the recipient of the interest: (c) is not required to use a rate notified by the Commissioner under section 25A 0.330 3 The payer of the interest— (a) has been supplied with the tax file number of a person who is paid the interest; and (b) has received a payment rate election from the recipient of the interest–– (i) before 1 October 2010, choosing the 0.390 or 0.380 payment rate, and the payer is not required to use a rate notified by the Commissioner under section 25A (ii) on or after 1 October 2010, choosing the 0.330 payment rate. 0.330 4 The payer of the interest— (a) has been supplied with the tax file number of a person who is paid the interest; and (b) has received a payment rate election from the recipient of the interest–– (i) before 1 October 2010, choosing the 0.330 payment rate, and the payer is not required to use a rate notified by the Commissioner under section 25A (ii) on or after 1 October 2010, choosing the 0.300 payment rate. 0.300 5 The payer of the interest— (a) has been supplied with the tax file number of a person who has not opened a new account after 31 March 2010 and who is paid the interest; and (b) has not received a payment rate election from the recipient of the interest; and (c) is not required to use a rate notified by the Commissioner under section 25A 0.175 6 The payer of the interest— (a) has been supplied with the tax file number of a person who is paid the interest; and (b) has received a payment rate election from the recipient of the interest–– (i) before 1 October 2010, choosing the 0.195 or 0.210 payment rate, and the payer is not required to use a rate notified by the Commissioner under section 25A (ii) on or after 1 October 2010, choosing the 0.175 payment rate. 0.175 7 The payer of the interest— (a) has been supplied with the tax file number of a person, other than a trustee, who is paid the interest; and (b) has received a payment rate election from the recipient of the interest–– (i) before 1 October 2010, choosing the 0.125 payment rate, and the payer is not required to use a rate notified by the Commissioner under section 25A (ii) on or after 1 October 2010, choosing the 0.105 payment rate; and (c) the recipient has a reasonable expectation at the time of the election that their income for the income year will be $14,000 or less. 0.105 8 The payer of the interest— (a) has been supplied with the tax file number of a person who is paid the interest as a trustee of a testamentary trust to which section HC 37 (b) has received a payment rate election from the recipient of the interest–– (i) before 1 October 2010, choosing the 0.125 payment rate, and the payer of the interest is not required to use a rate notified by the Commissioner under section 25A (ii) on or after 1 October 2010, choosing the 0.105 payment rate. 0.105 How to use this table:Find the applicable condition in the second column, in order to find the relevant rate to apply, in the third column.
33: Schedule 1—Basic tax rates: income tax, ESCT, RSCT, RWT, and attributed fringe benefits: part D, table 3
In schedule 1 3 The payer of the interest— (a) has been supplied with the tax file number of a person who is paid interest; and (b) has received a payment rate election from the recipient of the interest,–– (i) on or after 1 October 2010, choosing the 0.33 payment rate: (ii) before 1 October 2010, choosing the 0.39 or 0.38 payment rate. 0.33 4 The payer of the interest has not been supplied with the tax file number of a person who is paid the interest. 0.33
34: Schedule 1—Basic tax rates: income tax, ESCT, RSCT, RWT, and attributed fringe benefits: part D, table 4
In schedule 1 0.38 0.33
35: Schedule 1—Basic tax rates: income tax, ESCT, RSCT, RWT, and attributed fringe benefits: part D, table 5
Schedule 1 Table 5 Row Conditions Payment rate 1 The person responsible for withholding RSCT— (a) has been notified under section 28C (b) has been supplied with the tax file number of the person. 0.105 2 The person is a non-resident and a distribution of no more than $200 is made to them by a retirement scheme contributor that is a Maori authority. 0.105 3 The person responsible for withholding RSCT— (a) has been notified under section 28C (b) has been supplied with the tax file number of the person. 0.175 4 The person responsible for withholding RSCT— (a) has been notified under section 28C (b) has been supplied with the tax file number of the person. 0.300 5 When none of rows 1 to 4 apply. 0.330 How to use this table:Find the applicable condition in the second column, in order to find the relevant rate to apply, in the third column.
36: Schedule 2—Basic tax rates for PAYE income payments: part A
In schedule 2
a: in clause 4 0.21 0.175
b: in clause 5 0.33 0.300
c: in clause 6 0.38 0.330
d: in clause 7 0.21 0.175
e: in clause 9 0.125 0.105
37: Schedule 2—Basic tax rates for PAYE income payments: part B, table 1
Schedule 2 Table 1 Row Condition Tax rate 1 Section RD 17(2)(a) 0.105 2 Section RD 10(2)(a) RD 17(2)(b) 0.175 3 Section RD 10(2)(b) RD 17(2)(c) 0.300 4 Section RD 10(2)(c) RD 17(2)(d) 0.330 How to use this table:Find the applicable condition in the second column, in order to find the relevant rate to apply, in the third column.
38: Schedule 4—Rates of tax for schedular payments: part I
In schedule 4 0.125 0.105
39: Schedule 6—Prescribed rates: PIE investments and retirement scheme contributions: table 1
In schedule 6
a: in row 1, 0.300 0.280
b: in row 2, 0.300 0.280
c: in row 3, 0.300 0.280
d: in row 4, 0.210 0.175
e: in row 5, 0.210 0.175
f: in row 6, 0.125 0.105
g: in row 7, 0.125 0.105
40: Schedule 6—Prescribed rates: PIE investments and retirement scheme contributions: table 2
In schedule 6
a: in row 1, 0.380 0.330
b: in row 2, 0.330 0.300
c: in row 3, 0.210 0.175
d: in row 4, 0.125 0.105
e: in row 5, 0.125 0.105
f: in row 6, 0.125 0.105 Amendments to Tax Administration Act 1994
41: Tax Administration Act 1994
Sections 42 and 43 Tax Administration Act 1994 2010-10-01 Tax Administration Act 1994 ss 42 and 43
42: Person advising retirement savings scheme of retirement scheme prescribed rate
In section 28C 38 33
43: Section 140BB replaced
Section 140BB
140C: Transitional imputation penalty tax payable in some circumstances
1: This section applies when a company has an end of year debit balance under section OA 3(3) and (4) of the Income Tax Act 2007 for its imputation credit account as at 31 March 2013, if the company is treated, for the purposes of this section, as having only the balances and adjustments referred to in subsections (2) and (3)
2: For the purposes of subsection (1)
a: first, the company must subtract any overpayment of income tax for the 2010–11 or earlier income year in which the company was an ICA company:
b: secondly, the company must subtract––
i: any payment for an income year after the 2010–11 income year:
ii: any amount that is or would be refundable for an income year after the 2010–11 income year:
c: thirdly, the company must add any income tax paid for the 2010–11 or earlier income year in which the company was an ICA company.
3: For the purposes of subsection (1) subsection (2)
4: The company is liable for a special tax known as imputation penalty tax.
5: The amount of imputation penalty tax is 10% of the positive difference between zero and the end of year debit balance described in subsection (1) Amendments to Goods and Services Tax Act 1985
44: Goods and Services Tax Act 1985
Sections 45 to 53 Goods and Services Tax Act 1985 2010-10-01 Goods and Services Tax Act 1985 ss 45–53
45: Imposition of goods and services tax on supply
1: In section 8(1) 12.5 15
2: Subsection (1) applies to supplies made on or after 1 October 2010.
46: Value of supply of goods and services
1: In section 10(6) 7.5 9
2: Subsection (1) applies to supplies made on or after 1 October 2010.
47: Imposition of goods and services tax on imports
1: In section 12(1) 12.5 15
2: Subsection (1) applies to the importation of goods on or after 1 October 2010.
48: New section 21CB
After section 21C
21CB: Rate for change of use before 1 October 2010
For a registered person who is treated as supplying goods and services as described in sections 21 and 21D, the rate of goods and services tax used for attributing output tax under section 21C for the supply of those goods and services is the rate that applied for the supply of goods and services immediately before 1 October 2010 if,––
a: before 1 October 2010, the goods and services are applied for a purpose other than making taxable supplies; and
b: the registered person chooses to apply this section.
49: Deductions from output tax for goods and services applied for making taxable supplies
1: In section 21F(1) tax fraction COU tax fraction
2: After section 21F(2), the following is inserted:
4: For the purposes of this section, COU tax fraction
a: the tax fraction, if paragraph (b)
b: the tax fraction that applied at the time that the goods and services referred to in section 21E were acquired by the person, if, before 1 October 2010, the goods and services are applied in a taxable period for a purpose of making taxable supplies either by the person or, if the person is a member of a partnership, by the partnership.
50: Fringe benefits and entertainment expenses
1: In section 21I(4)(b) the time of the supply unless subsection (4B)
2: After section 21I(4)
4B: Despite subsection (4)(b)
a: the relevant expenditure or loss for the entertainment is incurred before 1 October 2010; and
b: the registered person chooses to apply this section.
51: Commissioner's right to withhold payments
In section 46(6) 45 45 or 78B(5)(c)
52: Effect of imposition or alteration of tax
In section 78(2) or where the alteration in the law has been taken into account,
53: Adjustments to tax payable for persons furnishing returns on payments basis following change in rate of tax
1: Section 78B(2)(b)
2: In section 78B(4) for the return referred to in subsection (2)(b) of this section. for,––
a: the person's part 1 return furnished under section 78A of this Act; or
b: the return for the taxable period ending with the day preceding the date on which the new rate of tax comes into force, if the person is not required to furnish a part 1 return.
3: In section 78B(5)
c: to the extent that it cannot be so set off, refunded to the person, subject to section 46(6). GST-related amendments to Tax Administration Act 1994
54: Tax Administration Act 1994
Sections 55 56 Tax Administration Act 1994 2010-10-01 Tax Administration Act 1994 ss 55 and 56
55: Late payment penalty
1: In section 139B(1)(b) the taxpayer has failed ignoring any failure to pay for which a penalty is remitted under section 183AA
2: In section 139B(1)(c) the taxpayer has paid on time ignoring any failure to pay for which a penalty is remitted under section 183AA
56: New section 183AA
Before section 183A
183AA: Remission for GST transitional taxable periods
1: This section applies to––
a: a late filing penalty imposed under section 139AAA in respect of a GST return required to be furnished for a GST transitional taxable period:
b: a late payment penalty imposed under section 139B in respect of unpaid tax for a GST transitional taxable period:
c: interest payable under Part 7 in respect of unpaid tax for a GST transitional taxable period.
2: The Commissioner must remit a taxpayer's penalty or interest to the extent to which, objectively, the penalty or interest are imposed because of the taxpayer's acts or omissions in respect of the change in the rate of goods and services tax on 1 October 2010.
3: Subsection (2)
4: In this section, GST transitional taxable period
a: a taxable period, as defined in the Goods and Services Tax Act 1985 GST taxable period
b: a GST taxable period that includes 1 October 2010 and a later GST taxable period, if that later GST taxable period ends on or before 31 December 2010:
c: a GST taxable period for which the taxpayer is required to make a return that includes an adjustment under section 78B of the Goods and Services Tax Act 1985 Section 56 amended 7 September 2010 section 174 Taxation (Annual Rates, Trans-Tasman Savings Portability, KiwiSaver, and Remedial Matters) Act 2010
2: Personal tax cuts: 2010–11 start
57: Application
In this Part, other than section 58
a: the subsection (1) of the sections apply for the 2010–11 income year and later income years:
b: the subsection (2) of the sections apply for the 2011–12 income year and later income years. Amendments to Income Tax Act 2007
58: Income Tax Act 2007
Sections 59 to 72 Income Tax Act 2007 2010-05-28 Income Tax Act 2007 subsection (1)s only in ss 59–72. Applies from 1 April 2010 (note further application rhubarb in s 57(a)) (NB the date is 28 May because the commencement date was 7 days earlier than the assent date — see updated COG) 2011-04-01 Income Tax Act 2007 subsection (2)s only in ss 59–72 (note application rhubarb in s 57(b))
59: Child's income
1: In section LC 3
a: in subsection (3)(a), $292.50 $269.10
b: in subsection (4), in the formula, 12.5 11.5
2: In section LC 3
a: in subsection (3)(a), $269.10 $245.70
b: in subsection (4), in the formula, 11.5 10.5
60: Tax credits for transitional circumstances
1: In section LC 4
a: in subsection (3)(a)(i), $728 $669.76
b: in subsection (4), in the formula,––
i: $728 $669.76
ii: 0.20 0.184
2: In section LC 4
a: in subsection (3)(a)(i), $669.76 $611.52
b: in subsection (4), in the formula,––
i: $669.76 $611.52
ii: 0.184 0.168
61: Calculation of family tax credit
1: In section MD 3(4)
a: in paragraph (a)(i), $4,487 $4,532
b: in paragraph (a)(ii), $5,198 $5,251
c: in paragraph (b)(i), $3,119 $3,151
d: in paragraph (b)(ii), $3,557 $3,593
e: in paragraph (b)(iii), $4,651 $4,698
2: In section MD 3(4)
a: in paragraph (a)(i), $4,532 $4,578
b: in paragraph (a)(ii), $5,251 $5,303
c: in paragraph (b)(i), $3,151 $3,182
d: in paragraph (b)(ii), $3,593 $3,629
e: in paragraph (b)(iii), $4,698 $4,745
62: Minimum family tax credit
1: In section ME 1(3)(a) $20,800 $21,008
2: In section ME 1(3)(a) $21,008 $21,216
63: New sections MF 4D and MF 4E
1: After section MF 4C
MF 4D: Calculation of instalments: 1 April 2010 to 30 September 2010
When this section applies
1: This section applies for calculating the amount of an instalment by way of tax credit under section MD 1 (Abating WFF tax credit), or as applicable, sections MD 1 and ME 1 (Minimum family tax credit) for the period starting on 1 April 2010 and finishing on 30 September 2010. Family tax credit formula: section MD 3
2: The instalments for the relevant tax credit are calculated using, for the calculation of the family tax credit prescribed amount × days 365. Definition of items in formula in subsection (2)
3: The items in the formula are defined in subsections (4) and (5). Prescribed amount
4: Prescribed amount
a: for the eldest dependent child for whom the person is a principal caregiver during the entitlement period, 1 of the following, as applicable:
i: $4,487, if the child is younger than 16:
ii: $5,198, if the child is 16 or older:
iii: a weighted average of the amounts in subparagraphs (i) and (ii) that reflects the proportion of the period for which those subparagraphs apply to the child, if the child turns 16 during the entitlement period; and
b: for each dependent child for whom the person is a principal caregiver during the entitlement period, other than the eldest dependent child, 1 of the following, as applicable:
i: $3,119, if the child is younger than 13:
ii: $3,557, if the child is 13, 14, or 15:
iii: $4,651, if the child is 16 or older:
iv: a weighted average of the amounts in subparagraphs (i) and (ii) that reflects the proportion of the period for which those subparagraphs apply to the child, if the child turns 13 during the entitlement period:
v: a weighted average of the amounts in subparagraphs (ii) and (iii) that reflects the proportion of the entitlement period for which those subparagraphs apply to the child, if the child turns 16 during the entitlement period. Days
5: Days When another person cares for dependent child
6: A family tax credit must be reduced in proportion to the time in the entitlement period that a dependent child spends in the exclusive care of another person who qualifies under section MC 2 (Who qualifies for entitlements under family scheme?). Family credit abatement formula: section MD 13
7: The instalments for the relevant tax credit are calculated using, for the calculation of the family credit abatement full-year abatement × days 365. Definition of items in formula in subsection (7)
8: In the formula,—
a: full-year abatement
i: if the person has no spouse, civil union partner, or de facto partner during the entitlement period, and the person’s family scheme income for the relationship period containing the entitlement period is more than $36,827, 20 cents for each complete dollar of the excess; or
ii: if the person has a spouse, civil union partner, or de facto partner during the entitlement period, and the person’s family scheme income, the family scheme income of their spouse, civil union partner, or de facto partner, or the sum of those incomes for the relationship period containing the entitlement period is more than $36,827, 20 cents for each complete dollar of the excess:
b: days When 56-day period includes 31 March
9: If a person who qualifies under section MC 2 receives instalments of the parental tax credit in a 56-day period that includes 31 March, the formula is applied so that—
a: instalments of the parental tax credit received in the first tax year are abated against the person’s family scheme income, the family scheme income of their spouse, civil union partner, or de facto partner, or the sum of those incomes for that tax year; and
b: instalments of the parental tax credit received in the second tax year are abated against the person’s family scheme income, the family scheme income of their spouse, civil union partner, or de facto partner, or the sum of those incomes for that tax year. Relationship with subject matter
10: Sections MD 14 to MD 16 (which relate to family credit abatement), with necessary modifications, apply to the calculation of the family credit abatement Minimum family tax credit formula: section ME 1
11: The instalments for the relevant tax credit are calculated using, for the calculation of the minimum family tax credit prescribed amount – net family scheme income × weekly periods 52. Definition of items in formula in subsection (11)
12: In the formula,—
a: prescribed amount
b: net family scheme income
i: the person; or
ii: their spouse, civil union, or de facto partner; or
iii: the person and their spouse, civil union, or de facto partner:
c: weekly periods Relationship with subject matter
13: Sections ME 2 (Meaning of employment for this subpart) and ME 3, with necessary modifications, apply to the calculation of the minimum family tax credit Defined in this Act: amount, child, civil union partner, de facto partner, dependent child, entitlement period, family credit abatement, family scheme income, family tax credit, full-time earner, minimum family tax credit, net family scheme income, parental tax credit, principal caregiver, protected family tax credit, relationship period, spouse, tax credit, tax year
MF 4E: Calculation of instalments: 1 October 2010 to 31 March 2011
When this section applies
1: This section applies for calculating the amount of an instalment by way of tax credit under section MD 1 (Abating WFF tax credit), or as applicable, sections MD 1 and ME 1 (Minimum family tax credit) for the period starting on 1 October 2010 and finishing on 31 March 2011. Family tax credit formula: section MD 3
2: The instalments for the relevant tax credit are calculated using, for the calculation of the family tax credit prescribed amount × days 365. Definition of items in formula in subsection (2)
3: The items in the formula are defined in subsections (4) and (5). Prescribed amount
4: Prescribed amount
a: for the eldest dependent child for whom the person is a principal caregiver during the entitlement period, 1 of the following, as applicable:
i: $4,578, if the child is younger than 16:
ii: $5,303, if the child is 16 or older:
iii: a weighted average of the amounts in subparagraphs (i) and (ii) that reflects the proportion of the period for which those subparagraphs apply to the child, if the child turns 16 during the entitlement period; and
b: for each dependent child for whom the person is a principal caregiver during the entitlement period, other than the eldest dependent child, 1 of the following, as applicable:
i: $3,182, if the child is younger than 13:
ii: $3,629, if the child is 13, 14, or 15:
iii: $4,745, if the child is 16 or older:
iv: a weighted average of the amounts in subparagraphs (i) and (ii) that reflects the proportion of the period for which those subparagraphs apply to the child, if the child turns 13 during the entitlement period:
v: a weighted average of the amounts in subparagraphs (ii) and (iii) that reflects the proportion of the entitlement period for which those subparagraphs apply to the child, if the child turns 16 during the entitlement period. Days
5: Days When another person cares for dependent child
6: A family tax credit must be reduced in proportion to the time in the entitlement period that a dependent child spends in the exclusive care of another person who qualifies under section MC 2 (Who qualifies for entitlements under family scheme?). Family credit abatement formula: section MD 13
7: The instalments for the relevant tax credit are calculated using, for the calculation of the family credit abatement full-year abatement × days 365. Definition of items in formula in subsection (7)
8: In the formula,—
a: full-year abatement
i: if the person has no spouse, civil union partner, or de facto partner during the entitlement period, and the person’s family scheme income for the relationship period containing the entitlement period is more than $36,827, 20 cents for each complete dollar of the excess; or
ii: if the person has a spouse, civil union partner, or de facto partner during the entitlement period, and the person’s family scheme income, the family scheme income of their spouse, civil union partner, or de facto partner, or the sum of those incomes for the relationship period containing the entitlement period is more than $36,827, 20 cents for each complete dollar of the excess:
b: days When 56-day period includes 31 March
9: If a person who qualifies under section MC 2 receives instalments of the parental tax credit in a 56-day period that includes 31 March, the formula is applied so that—
a: instalments of the parental tax credit received in the first tax year are abated against the person’s family scheme income, the family scheme income of their spouse, civil union partner, or de facto partner, or the sum of those incomes for that tax year; and
b: instalments of the parental tax credit received in the second tax year are abated against the person’s family scheme income, the family scheme income of their spouse, civil union partner, or de facto partner, or the sum of those incomes for that tax year. Relationship with subject matter
10: Sections MD 14 to MD 16 (which relate to family credit abatement), with necessary modifications, apply to the calculation of the family credit abatement Minimum family tax credit formula: section ME 1
11: The instalments for the relevant tax credit are calculated using, for the calculation of the minimum family tax credit prescribed amount – net family scheme income × weekly periods 52. Definition of items in formula in subsection (11)
12: In the formula,—
a: prescribed amount
b: net family scheme income
i: the person; or
ii: their spouse, civil union, or de facto partner; or
iii: the person and their spouse, civil union, or de facto partner:
c: weekly periods Relationship with subject matter
13: Sections ME 2 (Meaning of employment for this subpart) and ME 3, with necessary modifications, apply to the calculation of the minimum family tax credit Defined in this Act: amount, child, civil union partner, de facto partner, dependent child, entitlement period, family credit abatement, family scheme income, family tax credit, full-time earner, minimum family tax credit, net family scheme income, parental tax credit, principal caregiver, protected family tax credit, relationship period, spouse, tax credit, tax year .
2: Sections MF 4B and MF 4C are repealed.
64: Employer's liability for attributed benefits
1: In section RD 50
a: in subsection (4), 49 45.99
b: in subsection (5), 61.29 55.04
2: In section RD 50
a: in subsection (4), 45.99 42.86
b: in subsection (5), 55.04 49.25
65: Calculation for certain employees when information lacking
1: In section RD 52(3)
a: in paragraph (a), 49 45.99
b: in paragraph (b), 61.29 55.04
2: In section RD 52(3)
a: in paragraph (a), 45.99 42.86
b: in paragraph (b), 55.04 49.25
66: Pooling non-attributed benefits
1: In section RD 53(4)
a: in paragraph (a), 61 55.04
b: in paragraph (b), 49 45.99
2: In section RD 53(4)
a: in paragraph (a), 55.04 49.25
b: in paragraph (b), 45.99 42.86
67: Single rate option
1: Section RD 58(1)
1: An employer who chooses to pay their FBT liability under the single rate option must pay FBT at the rate of––
a: 61% of the taxable value of a fringe benefit for each of the first 2 quarters of a tax year:
b: 49.25% of the taxable value of a fringe benefit for each of the last 2 quarters of a tax year.
2: Section RD 58(1)
1: An employer who chooses to pay their FBT liability under the single rate option must pay FBT at the rate of 49.25% of the taxable value of a fringe benefit for each of the 4 quarters of a tax year.
68: Alternate rate option
1: In section RD 59
a: in subsection (2), first 3 quarters of a tax year at 49% of first 2 quarters of a tax year at 49% of, and, for the 3rd quarter, at 43% of,
b: subsection (3), other than its heading, is replaced by the following:
3: The employer must pay FBT at the rate of––
a: 61% of the taxable value of a fringe benefit for any of the first 2 quarters of a tax year for which they do not pay at the rate of 49% under subsection (2):
b: 49% of the taxable value of a fringe benefit for the 3rd quarter of a tax year for which they do not pay at the rate of 43% under subsection (2).
2: In section RD 59
a: in subsection (2), first 2 quarters of a tax year at 49% of, and, for the 3rd quarter, at 43% of, first 3 quarters of a tax year at 43% of
b: subsection (3), other than its heading, is replaced by the following:
3: The employer must pay FBT at the rate of 49.25% Section 68(2)(b) amended 7 September 2010 section 210 Taxation (Annual Rates, Trans-Tasman Savings Portability, KiwiSaver, and Remedial Matters) Act 2010
69: Close company option
1: In section RD 60(3)(a) 61 55.04
2: In section RD 60(3)(a) 55.04 49.25
70: Small business option
1: In section RD 61(3)(a) 61 55.04
2: In section RD 61(3)(a) 55.04 49.25
71: Schedule 1—Basic tax rates: income tax, ESCT, RSCT, RWT, and attributed fringe benefits: part A, table 1
1: Schedule 1 Table 1 Row Range of dollar in taxable income Tax rate 1 $0 – $14,000 0.1150 2 $14,001 – $48,000 0.1925 3 $48,001 – $70,000 0.3150 4 $70,001 upwards 0.3550 How to use this table:Find the range in the second column for each dollar in the person's taxable income, and apply the relevant rate for the dollar in the third column.
2: Schedule 1 Table 1 Row Range of dollar in taxable income Tax rate 1 $0 – $14,000 0.105 2 $14,001 – $48,000 0.175 3 $48,001 – $70,000 0.300 4 $70,001 upwards 0.330 How to use this table:Find the range in the second column for each dollar in the person's taxable income, and apply the relevant rate for the dollar in the third column.
72: Schedule 1—Basic tax rates: income tax, ESCT, RSCT, RWT, and attributed fringe benefits: part C, table 1
1: Schedule 1 Table 1 Row Range of dollar in all-inclusive pay Tax rate 1 $0 – $12,390 0.1299 2 $12,391 – $39,845 0.2384 3 $39,846 – $54,915 0.4599 4 $54,916 upwards 0.5504 How to use this table:Find the range in the second column for each dollar in the person's all-inclusive pay under section RD 51, and apply the relevant rate for the dollar in the third column.
2: Schedule 1 Table 1 Row Range of dollar in all-inclusive pay Tax rate 1 $0 – $12,530 0.1173 2 $12,531 – $40,580 0.2121 3 $40,581 – $55,980 0.4286 4 $55,981 upwards 0.4925 How to use this table:Find the range in the second column for each dollar in the person's all-inclusive pay under section RD 51 Amendment to Tax Administration Act 1994
73: Returns not required for certain providers of personal services
1: In section 33C(c) rate of 12.5% from rate of 10.5% or 12.5% from
2: In section 33C(c) rate of 10.5% or 12.5% from rate of 10.5% from 2010-05-28 Tax Administration Act 1994 subs (1) only — applies from 1 April 2010 (see s 57 for extra application hooha) (NB the date is 28 May because the commencement date was 7 days earlier than the assent date — see updated COG) 2011-04-01 Tax Administration Act 1994 subs (2) only (see s 57 for application hooha)
3: Other measures
Amendments to Income Tax Act 2007
74: Income Tax Act 2007
Sections 75 to 99 Income Tax Act 2007 2010-05-28 Income Tax Act 2007 (NB the date is 28 May because the commencement date was 7 days earlier than the assent date — see updated COG) 2011-04-01 Income Tax Act 2007 2012-04-01 Income Tax Act 2007
75: New section CG 8
1: After section CG 7
CG 8: Capital contributions
When this section applies
1: This section applies for the income year (the first year Income
2: For an income year, the amount given by the following formula is income of the person derived in that income year: capital contribution 10. Definition of item in formula
3: In the formula, capital contribution Exception
4: This section does not apply for the capital contribution if the person has chosen, in accordance with section DB 64(1)(c) section DB 64 amount, capital contribution, income, income year, return of income .
2: Subsection (1)
76: New heading and section DB 64
1: Before the heading to subpart DC Capital contributions
DB 64: Capital contributions
When this section applies
1: This section applies if,––
a: a person has derived a capital contribution after 20 May 2010; and
b: in the absence of this section, the person would be allowed a deduction for an amount of depreciation loss for an item of depreciable property for which the capital contribution is a contribution ( see capital contribution
c: the person has chosen to apply this section in a return of income for the income year in which the capital contribution is derived. Deduction
2: For the purposes of quantifying the amount of depreciation loss for the income year under subpart EE (Depreciation), the item's adjusted tax value, base value, cost, or value, as applicable, is reduced by the amount of the capital contribution. Links with subpart DA
3: This section overrides the general permission. adjusted tax value, amount, capital contribution, deduction, general permission, income, income year, return of income .
2: Subsection (1)
77: Annual rate for item acquired in person's 1995–96 or later income year
1: In section EE 31(1) Subsection (2) subsection (3) subsection (2)
2: In section EE 31(2)
a: in the heading, Rate Rate for item acquired on or before 20 May 2010
b: The rate is The rate, if the person acquires the item, or enters into a binding contract for the purchase or construction of the item, on or before 20 May 2010, is
3: After section EE 31(2) Rate for item acquired after 20 May 2010
3: The rate, if subsection (2)
a: the item's economic rate, special rate, or provisional rate, for an item not described in paragraph (b)
b: a diminishing value rate of 15% or a straight-line rate of 10% for an international aircraft.
4: In section EE 31
a: in subsection (2)(a), either paragraph (b) or (c) paragraph (b), (c), or (d)
b: in subsection (2)(c), aircraft. aircraft:
d: 0% for a building that has an economic rate or provisional rate of more than 0% due to an estimated useful life of 50 years or more.”; and ; and
c: in subsection (3)(a), paragraph (b) either paragraph (b) or (c)
d: in subsection (3)(b), aircraft. aircraft:
c: 0%, for a building that has an economic rate or provisional rate of more than 0% due to an estimated useful life of 50 years or more.”
5: In section EE 31 estimated useful life
6: Subsections (4) and (5)
78: Special rate or provisional rate
1: Section EE 35(2) No special rate for excluded depreciable property, special excluded depreciable property, or building
2: A special rate may not be set for an item of excluded depreciable property, an item of special excluded depreciable property, or a building.
2: In section EE 35 special excluded depreciable property
79: Improvements
1: Section EE 37(3)(a)
a: a person who uses the diminishing value method or the straight-line method for the item that was improved may choose to apply subsection (4) or (5), if paragraph (ab)
ab: a person who uses the diminishing value method or the straight-line method for the item that was improved must use subsection (3B)
i: the person makes the improvement, or enters into a binding contract for the purchase or construction of the improvement, after 30 July 2009; and
ii: the item that was improved is a grandparented structure: .
2: Section EE 37(3)(a) and (ab)
a: a person who uses the diminishing value method or the straight-line method for the item that was improved may choose to apply subsection (4) or (5), if paragraph (ab)
ab: a person who uses the diminishing value method or the straight-line method for the item that was improved must use subsection (3B)
i: the person makes the improvement, or enters into a binding contract for the purchase or construction of the improvement, after 20 May 2010; and
ii: the item that was improved is a grandparented structure, or is not a building, is not a used import car, is not an international aircraft, or has not been used or held for use in New Zealand as an item of depreciable property before the date on which the person acquires it: .
3: After section EE 37(3) Improvement compulsorily treated as separate item
3B: For the purposes of subsection (3)(ab)
4: In section EE 37 grandparented structure international aircraft New Zealand
80: Effect of disposal or event
1: Section EE 48(1)(b)
b: the amount given by subsections (1B) and (1C)
2: After section EE 48(1) Amount for subsection (1)(b)
1B: The amount for the purposes of subsection (1)(b) item depreciation loss + CZ 11 item amount + DB 64 item amount. Definition of items in formula
1C: In the formula in subsection (1B)
a: item depreciation loss
b: CZ 11 item amount
c: DB 64 item amount section DB 64
3: In section EE 48 capital contribution
81: Meaning of annual rate
1: In section EE 61(2) The rate is the rate set by section EE 31(2)(a) or (b) if The rate is the rate set by section EE 31(2)(a) or (b), or by section EE 31(3)(a)
2: In section EE 61(3) The rate is the rate set by section EE 31(2)(c) if The rate is the rate set by section EE 31(2)(c), or by section EE 31(3)(b)
3: After section EE 61(3) 1995–1996 income year or later: buildings with estimated useful lives of 50 years or more
3B: The rate is the rate set by section EE 31(2)(d), or by section EE 31(3)(c)
a: has an economic rate or provisional rate of more than 0% due to an estimated useful life of 50 years or more; and
b: the person acquires in their 1995–96 income year or a later income year.
4: After section EE 61(7) Special excluded depreciable property
7B: The rate is 0% for all depreciation methods, if the item is an item of special excluded depreciable property that would be an item of excluded depreciable property but for the exclusion in section EE 64(3)
5: In section EE 61 economic rate estimated useful life provisional rate special excluded depreciable property
6: Subsections (3) to (5)
82: Meaning of excluded depreciable property
1: After section EE 64(2) Another exclusion
3: Excluded depreciable property
2: In section EE 64 special excluded depreciable property
3: Subsections (1) and (2)
83: Other definitions
1: In section EE 67 provisional rate special excluded depreciable property schedule 39 .
2: In section EE 67 special excluded depreciable property
3: Subsections (1) and (2)
84: Subparts EE and EZ: list of defined terms
In sections EE 7 EE 11 EE 26 EE 27 EE 28 EE 30 EE 31 EE 32 EE 35 EE 37 EE 39 EE 48 EE 58 EE 61 EE 66 EE 67 EZ 13 EZ 14 building
85: Annual rate for item acquired on or after 1 April 1993 and before end of person's 1994–95 income year
1: Section EZ 13(2) Rate
2: The rate is––
a: the item's economic rate, if the item is not a building that has an economic rate or provisional rate of more than 0% due to an estimated useful life of 50 years or more; or
b: the pre-1993 depreciation rate described in section EZ 14, if the person chooses under that section; or
c: 0%, for a building that has an economic rate or provisional rate of more than 0% due to an estimated useful life of 50 years or more.
2: In section EZ 13 estimated useful life provisional rate
3: Subsections (1) and (2)
86: Pre-1993 depreciation rate
1: In section EZ 14(1) 1994–95 income year 1994–95 income year excluding buildings that have an economic rate or provisional rate of more than 0% due to an estimated useful life of 50 years or more
2: In section EZ 14 economic rate estimated useful life provisional rate
3: Subsections (1) and (2)
87: Thresholds for application of interest apportionment rules
1: Section FE 5(1)
1: An excess debt entity must apportion its interest expenditure for an income year under section FE 6 if,––
a: the excess debt entity is not a trustee and not an excess debt outbound company, or is a trustee who is not described in section FE 2(1)(g), and––
i: the debt percentage of its New Zealand group for the income year is more than 60%; and
ii: for a company or a trustee, the debt percentage of its New Zealand group for the income year is more than 110% of the debt percentage of the worldwide group; or
b: the excess debt entity is an excess debt outbound company, or is a trustee who is described in section FE 2(1)(g), and––
i: the debt percentage of its New Zealand group for the income year is more than 75%; and
ii: for a company or a trustee, the debt percentage of its New Zealand group for the income year is more than 110% of the debt percentage of the worldwide group.
2: Section FE 5(3)
3: A natural person must apportion their interest expenditure for an income year under section FE 6 if,––
a: they are not described in section FE 2(1)(g), and the debt percentage of their New Zealand group for the income year is more than 60%; or
b: they are described in section FE 2(1)(g), and the debt percentage of their New Zealand group for the income year is more than 75%.
3: Subsections (1) and (2) apply for the 2011–12 and later income years.
88: Apportionment of interest by excess debt entity
1: Section FE 6(3)(e)
e: threshold amount
i: if the excess debt entity is not a trustee and not an excess debt outbound company, or is a trustee who is not described in section FE 2(1)(g), the greater of 60% and 110% of the debt percentage of their worldwide group:
ii: if the person is a natural person who is not described in section FE 2(1)(g), 60%:
iii: if the excess debt entity is an excess debt outbound company, or is a trustee who is described in section FE 2(1)(g), the greater of 75% and 110% of the debt percentage of their worldwide group:
iv: if the person is a natural person who is described in section FE 2(1)(g), 75%.
2: In section FE 6, in the list of defined terms, excess debt outbound company
3: Subsections (1) and (2) apply for the 2011–12 and later income years.
89: Calculation of debt percentages
1: In section FE 12(2) is more than 75% as described in section FE 5(1)(a), the is, as applicable, more than 60% as described in section FE 5(1)(a), or more than 75% as described in section FE 5(1)(b), then the
2: Subsection (1) applies for the 2011–12 and later income years.
90: Measurement of debts and assets of worldwide group
1: Section FE 18(5)
5: The debt percentage of the worldwide group of an excess debt entity is treated as,––
a: 54.5454%, if the excess debt entity is not a trustee and not an excess debt outbound company, or is a trustee who is not described in section FE 2(1)(g), and––
i: the entity is unable to calculate the percentage and does not ask the Commissioner to make an estimate under subsection (4):
ii: the Commissioner cannot reasonably estimate the debt percentage under subsection (4):
iii: no member of the entity's worldwide group, other than the entity, is not resident in New Zealand; or
b: 68.1818%, if the excess debt entity is an excess debt outbound company, or is a trustee who is described in section FE 2(1)(g), and––
i: the entity is unable to calculate the percentage and does not ask the Commissioner to make an estimate under subsection (4):
ii: the Commissioner cannot reasonably estimate the debt percentage under subsection (4):
iii: no member of the entity's worldwide group, other than the entity, is not resident in New Zealand.
2: Subsection (1) applies for the 2011–12 and later income years.
91: Tax credits for supplementary dividends
1: In section LP 2(2) 7/17 24/53
2: Subsection (1)
92: Section MB 3 replaced
1: Section MB 3
MB 3: When person carries on 1 or more businesses
When this section applies
1: This section applies when a person carries on 1 or more businesses in the income year (each separate business, a single family scheme activity Ignore income and deductions for net loss activity
2: The income and deductions for a person's family scheme activity for an income year are ignored when calculating the person's family scheme income for the year if, treating the person as having only the income and deductions of that activity, the person would have a net loss for that year. Modification of what counts as 1 family scheme activity
3: For the purposes of applying subsection (2), and despite subsection (1), 2 or more family scheme activities may be treated as a single business activity, if the Commissioner considers that the 2 or more activities are of the kind that are normally carried on in association with each other. Apportionment of deductions between family scheme activities
4: For the purposes of applying subsection (2) as modified by subsection (3), deductions that relate to an asset used in carrying on 2 or more family scheme activities must be appropriately apportioned between the activities on the basis of the use of that asset in those 2 or more activities. business, deduction, family scheme income, income, income year, net loss 2004 No 35 s KD 1(1)(f), (2) .
2: Subsection (1) applies for the 2008–09 and later income years.
93: Section MB 3 replaced
1: Section MB 3
MB 3: When person carries on 1 or more businesses or investment activities
When this section applies
1: This section applies when a person carries on 1 or more businesses in the income year, or has or carries on 1 or more investment activities in the income year (each separate business or investment activity, a single family scheme activity Ignore income and deductions for net loss activity
2: The income and deductions for a person's family scheme activity for an income year are ignored when calculating the person's family scheme income for the year if, treating the person as having only the income and deductions of that activity, the person would have a net loss for that year. Modification of what counts as 1 family scheme activity
3: For the purposes of applying subsection (2), and despite subsection (1), 2 or more family scheme activities may be treated as a single family scheme activity, if the Commissioner considers that the 2 or more activities are of the kind that are normally carried on in association with each other. Apportionment of deductions between family scheme activities
4: For the purposes of applying subsection (2) as modified by subsection (3), deductions that relate to an asset used in carrying on 2 or more family scheme activities must be appropriately apportioned between the activities on the basis of the use of that asset in those 2 or more activities. Definition
5: In this section, investment activity business, deduction, family scheme income, income, income year, investment activity, net loss, variable principal debt instrument .
2: Subsection (1) applies for the 2011–12 and later income years.
94: Orders in Council
1: In section MF 7(1)(a) and the amount of the threshold set out in section MD 13(3) (Calculation of family credit abatement)
2: In section MF 7(1)(a)(i) quarterly all groups index number of the
3: After section MF 7(1)(c)
cb: increase the amounts appearing as the amount of the threshold set out in section MD 13(3): .
4: In section MF 7(2)(a) and (b) movements in the quarterly all groups index number of movement in
5: After section MF 7(2) How movement in CPI determined
2B: For the purposes of subsections (1)(a)(i) and (2)(a) and (b), a movement in the New Zealand Consumers Price Index over a period is determined by comparing the following numbers:
a: the number that, when the period started, was the most recent quarterly index number of—
i: the New Zealand Consumers Price Index all groups, if the period starts before 29 April 2010; and
ii: the New Zealand Consumers Price Index all groups excluding cigarettes and other tobacco products, if the period starts after 28 April 2010:
b: the number that, when the period ended, was the most recent quarterly index number of—
i: the New Zealand Consumers Price Index all groups, if the period ends before 29 April 2010; and
ii: the New Zealand Consumers Price Index all groups excluding cigarettes and other tobacco products, if the period ends after 28 April 2010.
6: Subsections (2), (4), and (5)
95: Subpart ML repealed
Section 95 repealed 24 May 2011 section 14 Taxation (Canterbury Earthquake Measures) Act 2011
96: Definitions
1: This section amends section YA 1
2: After the definition of broodmare building .
3: The definition of capital contribution capital contribution
a: in sections CG 8, DB 64, and EE 48
i: is paid by a person (the payer recipient
ii: is paid by the payer other than in their capacity of settlor, partner, or shareholder of the recipient; and
iii: is not income of the recipient, ignoring section CG 8
iv: is paid, under the express terms and conditions of the agreement, as a contribution for depreciable property owned or to be acquired by the recipient:
b: is defined in section HG 11(12) (Limitation on deductions by partners in limited partnerships) for the purposes of that section .
4: After the definition of grandparented consolidated company grandparented structure
a: barns, including barns (drying):
b: carparks (buildings):
c: chemical works:
d: fertiliser works:
e: powder drying buildings:
f: site huts .
5: After the definition of international tax rules investment activity .
6:
7: After the definition of special corporate entity special excluded depreciable property section EE 67 .
8: In the definition of temporary building
9: Subsections (5), (7), and (8) Section 96(6) repealed 24 May 2011 section 15 Taxation (Canterbury Earthquake Measures) Act 2011
97: Schedule 1—Basic tax rates: income tax, ESCT, RSCT, RWT, and attributed fringe benefits: part A
1: In schedule 1 0.30 0.28
2: In schedule 1 0.30 0.28
3: In schedule 1 0.30 0.28
4: In schedule 1 0.30 0.28
5: Subsections (1) to (4)
98: Schedule 1—Basic tax rates: income tax, ESCT, RSCT, RWT, and attributed fringe benefits: part D, table 3
In schedule 1 1 The payer of the interest— (a) has been supplied with the tax file number of a person who is paid interest; and (b) has not received a payment rate election from the recipient of the interest, ignoring the receipt of an election for the 0.33 payment rate before 1 October 2010 (if any). 0.28 2 The payer of the interest— (a) has been supplied with the tax file number of a person who is paid interest; and (b) has received a payment rate election from the recipient of the interest, choosing the 0.28 payment rate. 0.28
99: New schedule 39
1: After schedule 37
39: s EE 67 Items for purposes of definition of special excluded depreciable property
Carports (hired out to householders) Portable huts Cool-stores and freezing chambers Slaughterhouses on farms Fowl houses Plastic hothouses and PVC tunnel houses Glasshouses Buildings affected by acid Milking sheds Roofed livestock yards Wintering barns and simple loafing barns Milk powder buildings Temporary buildings .
2: Subsection (1) Amendment to Tax Administration Act 1994
100: Write-off of tax by Commissioner
After section 177C(1C)
1D: The Commissioner must write off an amount, not exceeding $30, of outstanding tax to the extent to which the amount––
a: is outstanding from the 2010–11 tax year; and
b: is tax payable under section MF 5(2) or MF 6(2) of the Income Tax Act 2007, or is otherwise the result of WFF tax credit overpayment or overcrediting. 2010-05-28 Tax Administration Act 1994 (NB the date is 28 May because the commencement date was 7 days earlier than the assent date — see updated COG)