Student Loan Scheme Act 1992

1: Short Title and application
1: This Act may be cited as the Student Loan Scheme Act 1992.
2: This Act is hereby declared to be one of the Inland Revenue Acts within the meaning of the Tax Administration Act 1994
3: Subject to Part 7 tax year Section 1(2) substituted 1 April 1995 Income Tax Act 1994 Section 1(3) amended 1 April 2005 section YA 2 Income Tax Act 2004
2: Interpretation
1: In this Act, unless the context otherwise requires,— borrower challenge Part 5 section 3(1) chief executive Social Security Act 1964 collection Commissioner Tax Administration Act 1994 department employee paragraph (a) of the definition of employee in section YA 1 employer paragraphs (a) and (b) of the definition of employer in section YA extra emolument section YA 1 gross income section YA 1 income-tested benefit section YA 1 interim repayment sections 26 to 28 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 lender Minister who is, with the authority of the Prime Minister, for the time being responsible for the administration of the Social Security Act 1964 loan balance , and includes any increase under section 103 loan contract loan manager loan year net income section YA 1 New Zealand based non-resident section YD 1 overseas based overseas based Part 3 PAYE intermediary section YA 1 penal charge section 86 penal repayment obligation section 85 penalty
a: any penalty chargeable under the loan contract for failure to pay any repayment obligation:
b: any penalty or additional charge or other late payment charge chargeable under this Act or under the Tax Administration Act 1994 periodic payer sections 26 to 28 primary employment earnings section 3(1) repayment code section 17B repayment deduction Part 2 repayment obligation tax year
a: in the case of a borrower who is New Zealand based tax year Part 2
b: in the case of a borrower who is overseas based tax year Part 3 repayment percentage section 87 repayment threshold
a: in respect of the tax year
b: in respect of the tax year tax year section 87 resident section YD 1 residual repayment obligation section 26(2) salary or wages section YA 1 secondary employment earnings section 3(1) student loan
a: means any money advanced under the student loan scheme to a borrower; and
b: includes—
i: any interest charged in respect of money advanced to a borrower under the student loan scheme; and
ii: any administration fee payable, in accordance with a loan contract, by the borrower under that loan contract to the lender under that loan contract student loan scheme tax year section YA 1 terminal repayment obligation section 29(2) total interest rate a% + 0.74% = y% where— a% is the average, rounded to the nearest 2 decimal places, of the monthly average 10-year government bond yield rates published by the Reserve Bank of New Zealand for the 5 years ending in December in the year that precedes the relevant tax year y% rounded to the nearest 1 decimal place, is the total interest rate for the relevant tax year.
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 Section 2(1) assessable income repealed 1 April 2005 section YA 2 Income Tax Act 2004 Section 2(1) base interest rate repealed 1 April 2008 section 4(1) Student Loan Scheme Amendment Act 2007 Section 2(1) challenge inserted 1 October 1996 section 2(1) Student Loan Scheme Amendment Act 1996 Section 2(1) chief executive inserted 19 September 2000 section 3(1) Student Loan Scheme Amendment Act 2000 Section 2(1) collection inserted 15 December 2000 section 4(1) Student Loan Scheme Amendment Act (No 2) 2000 Section 2(1) Commissioner amended 1 April 1995 Income Tax Act 1994 Section 2(1) employee amended 1 April 2008 section ZA 2(1) Income Tax Act 2007 Section 2(1) employee amended 1 April 1995 Income Tax Act 1994 Section 2(1) employer amended 1 April 2008 section ZA 2(1) Income Tax Act 2007 Section 2(1) employer amended 1 April 2005 section YA 2 Income Tax Act 2004 Section 2(1) extra emolument substituted 1 April 2005 section YA 2 Income Tax Act 2004 Section 2(1) extra emolument amended 1 April 2008 section ZA 2(1) Income Tax Act 2007 Section 2(1) gross income substituted 1 April 2005 section YA 2 Income Tax Act 2004 Section 2(1) gross income amended 1 April 2008 section ZA 2(1) Income Tax Act 2007 Section 2(1) income-tested benefit amended 1 April 2008 section ZA 2(1) Income Tax Act 2007 Section 2(1) income year repealed 1 April 2005 section YA 2 Income Tax Act 2004 Section 2(1) interest adjustment rate repealed 1 April 2008 section 4(1) Student Loan Scheme Amendment Act 2007 Section 2(1) IRD loan balance substituted 1 April 2007 section 4(2) Student Loan Scheme Amendment Act 2007 Section 2(1) lender amended 19 September 2000 section 3(2) Student Loan Scheme Amendment Act 2000 Section 2(1) loan balance amended 1 April 2007 section 4(3) Student Loan Scheme Amendment Act 2007 Section 2(1) net income inserted 26 July 1996 Taxation (Core Provisions) Act 1996 Section 2(1) net income amended 1 April 2008 section ZA 2(1) Income Tax Act 2007 Section 2(1) New Zealand based inserted 1 April 2007 section 4(4) Student Loan Scheme Amendment Act 2007 Section 2(1) non-resident amended 1 April 2008 section ZA 2(1) Income Tax Act 2007 Section 2(1) non-resident repayment obligation repealed 1 April 2007 section 4(5) Student Loan Scheme Amendment Act 2007 Section 2(1) overseas based inserted 1 April 2007 section 4(4) Student Loan Scheme Amendment Act 2007 Section 2(1) overseas based repayment obligation inserted 1 April 2007 section 4(5) Student Loan Scheme Amendment Act 2007 Section 2(1) PAYE intermediary inserted 26 March 2003 section 4(1) Student Loan Scheme Amendment Act 2003 Section 2(1) PAYE intermediary amended 1 April 2008 section ZA 2(1) Income Tax Act 2007 Section 2(1) penal charge amended 1 April 1993 section 2 Student Loan Scheme Amendment Act 1993 Section 2(1) penalty amended 1 April 1995 Income Tax Act 1994 Section 2(1) primary employment earnings amended 1 April 2008 section ZA 2(1) Income Tax Act 2007 Section 2(1) repayment code inserted 25 November 2003 section 4(1) Student Loan Scheme Amendment Act (No 2) 2003 Section 2(1) repayment obligation amended 1 April 2005 section YA 2 Income Tax Act 2004 Section 2(1) repayment obligation paragraph (a) amended 1 April 2007 section 4(6)(a) Student Loan Scheme Amendment Act 2007 Section 2(1) repayment obligation amended 1 April 2005 section YA 2 Income Tax Act 2004 Section 2(1) repayment obligation paragraph (b) amended 1 April 2007 section 4(6)(b) Student Loan Scheme Amendment Act 2007 Section 2(1) repayment obligation amended 1 April 2005 section YA 2 Income Tax Act 2004 Section 2(1) repayment threshold amended 1 April 2005 section YA 2 Income Tax Act 2004 Section 2(1) repayment threshold amended 1 April 2005 section YA 2 Income Tax Act 2004 Section 2(1) resident amended 1 April 2008 section ZA 2(1) Income Tax Act 2007 Section 2(1) salary or wages amended 1 April 2008 section ZA 2(1) Income Tax Act 2007 Section 2(1) secondary employment earnings amended 1 April 2008 section ZA 2(1) Income Tax Act 2007 Section 2(1) tax year inserted 21 June 2005 section 161 Taxation (Base Maintenance and Miscellaneous Provisions) Act 2005 Section 2(1) tax year amended 1 April 2008 section ZA 2(1) Income Tax Act 2007 Section 2(1) total interest rate substituted 1 April 2010 section 4 Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Act 2010 Section 2(2) added 1 April 2007 section 4(8) Student Loan Scheme Amendment Act 2007 Section 2(3) added 1 April 2007 section 4(8) Student Loan Scheme Amendment Act 2007
2A: Application of Act to bonded scholarships
1: In this section, bonded scholarship section 307AC
2: Any amount repayable under a bonded scholarship (the default amount
a: the default amount were a student loan; and
b: the recipient of the scholarship were a borrower; and
c: the scholarship agreement were a loan contract.
3: Despite any enactment or rule of law, if a provision in an agreement for a bonded scholarship conflicts with this provision, this provision prevails. Section 2A inserted 17 May 2006 section 59(1) Education Amendment Act 2006
3: Act to bind the Crown
This Act shall bind the Crown.
1: Transfer of loan balances to Commissioner for collection
Transfer of loan balances
4: Transfer of loan balances to Commissioner for collection
1: Subject to section 12
2: Every such transfer shall be effected in accordance with this Act and, unless the Commissioner otherwise requests, after the end of each loan year.
5: Notice to borrower
1: The loan manager shall, before transferring a borrower's loan balance to the Commissioner for collection, give to the borrower a notice—
a: stating that the loan manager is proposing to transfer the borrower's loan balance to the Commissioner for collection; and
b: giving the date at which it is proposed that the transfer take effect; and
c: specifying the amount of the borrower's loan balance and the date as at which it is calculated; and
d: notifying the borrower of the rights of objection conferred on the borrower by sections 6 8
2: Where the loan balance is calculated as at 31 December in any year,—
a: the notice required by subsection (1) shall be given to the borrower not later than 25 January in the following year; and
b: the date on which it is proposed that the transfer take effect shall not be earlier than 28 February in the following year.
3: Where the loan balance is calculated as at a date other than 31 December in any year, the notice required by subsection (1) shall be given to the borrower at least 1 month before the date on which it is proposed that the transfer take effect. Objections before transfer of loan balance to Commissioner
6: Right to object to amount of loan balance being transferred
1: Where a notice stating that the loan manager is proposing to transfer a borrower's loan balance to the Commissioner for collection is given to the borrower under section 5
2: If the loan balance is calculated as at 31 December in any year, notice of objection under subsection (1) shall, subject to section 10
3: If the loan balance is calculated as at a date other than 31 December in any year, notice of objection under subsection (1) shall, subject to section 10 section 5
7: Loan manager to consider objections
1: The loan manager shall consider every objection made under section 6(1)
2: The loan manager shall, as soon as practicable, give notice in writing to the objector of the loan manager's decision in respect of the objection, and of the reasons for that decision.
8: Power to require objection to be determined by
chief executive
1: If an objection under section 6(1) chief executive chief executive
2: Subject to section 10 chief executive Section 8 heading amended 19 September 2000 section 4(2) Student Loan Scheme Amendment Act 2000 Section 8(1) amended 19 September 2000 section 4(1) Student Loan Scheme Amendment Act 2000 Section 8(2) amended 19 September 2000 section 4(1) Student Loan Scheme Amendment Act 2000
9: Chief executive
1: The chief executive section 6(1) section 8
2: The chief executive chief executive's Section 9 heading amended 19 September 2000 section 5(3) Student Loan Scheme Amendment Act 2000 Section 9(1) amended 19 September 2000 section 5(1) Student Loan Scheme Amendment Act 2000 Section 9(2) amended 19 September 2000 section 5(1) Student Loan Scheme Amendment Act 2000 Section 9(2) amended 19 September 2000 section 5(2) Student Loan Scheme Amendment Act 2000
10: Extension of time for objection
The chief executive
a: the time allowed under section 6(2) or section 6(3)
b: the time allowed under section 8(2)
c: both. Section 10 amended 19 September 2000 section 6 Student Loan Scheme Amendment Act 2000
11: Right to apply to Disputes Tribunal or District Court
1: If an objection under section 6(1) chief executive section 8 chief executive chief executive
a: apply to a Disputes Tribunal for determination of the dispute if the amount in dispute is within the financial jurisdiction of the Disputes Tribunal; or
b: apply to a District Court for determination of the dispute.
2: A Referee of a Disputes Tribunal or a District Court Judge, as the case may be, may extend the time allowed under subsection (1) for applying to a Disputes Tribunal or District Court.
3: Notwithstanding anything in the Disputes Tribunals Act 1988 District Courts Act 1947 section 6(1) section 8(1) Section 11(1) amended 19 September 2000 section 7 Student Loan Scheme Amendment Act 2000
12: Prohibition on transfers
Notwithstanding section 4 section 6(1) section 8(1) section 11(1)
13: Notice of total amount outstanding
1: As soon as practicable after a loan balance is transferred to the Commissioner for collection, the Commissioner shall give notice in writing to the borrower of the total amount outstanding under the loan (which notice shall specify the net amount of principal and the net amount of interest transferred).
2: The borrower shall be liable to repay that total amount in accordance with this Act and the loan contract.
2: Collection of repayments from
New Zealand based borrowers Part 2 heading amended 1 April 2007 section 5 Student Loan Scheme Amendment Act 2007
14: Repayment obligation for
New Zealand based borrowers
1: The repayment obligation of each New Zealand based a tax year net tax year
2: However, if the borrower was overseas based for part of the relevant tax year, then (in calculating that borrower’s repayment obligation under subsection (1)) only the net income that the borrower derived during the period that the borrower was New Zealand based during that tax year must be taken into account.
3: Despite subsections (1) and (2), the repayment obligation for any tax year must not exceed the amount of the IRD loan balance on the last day of that tax year. Section 14 heading amended 1 April 2007 section 6(1) Student Loan Scheme Amendment Act 2007 Section 14(1) amended 1 April 2007 section 6(2) Student Loan Scheme Amendment Act 2007 Section 14(1) amended 1 April 2005 section YA 2 Income Tax Act 2004 Section 14(1) amended 26 July 1996 Taxation (Core Provisions) Act 1996 Section 14(2) substituted 7 March 2010 section 5 Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Act 2010 Section 14(3) added 7 March 2010 section 5 Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Act 2010 Returns and assessments
14A: Declaration of worldwide 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 YD 4
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. Section 14A inserted 1 April 2007 section 7 Student Loan Scheme Amendment Act 2007 Section 14A(2) amended 1 April 2008 section ZA 2(1) Income Tax Act 2007
15: Commissioner to assess borrower's repayment obligation
1: The Commissioner must make an assessment of the amount, if any, of a borrower's repayment obligation for a tax year as soon as practicable after the end of the tax year.
2: The assessment shall be made in accordance with the loan contract and this Act.
3: In making an assessment under this section, the Commissioner may have regard to—
a: a return of income furnished under the Tax Administration Act 1994
b: the sum of all amounts of gross income included in that income statement in the case of a borrower who has received an income statement; or
c: the sum of all amounts of gross income known to the Commissioner for a borrower not required to furnish a return of income or receive an income statement under the Tax Administration Act 1994 ; or
d: the details of all amounts of a borrower's gross income provided to the Commissioner under section 14A
4: The Commissioner shall, as soon as practicable after making any such assessment, give notice to the borrower of the amount assessed.
5: In this section, income statement section YA 1 Section 15(1) substituted 8 December 2009 section 168(1) Taxation (Consequential Rate Alignment and Remedial Matters) Act 2009 Section 15(3) substituted 7 October 1998 section 2(2) Student Loan Scheme Amendment Act (No 2) 1998 Section 15(3)(c) amended 1 April 2007 section 8(2) Student Loan Scheme Amendment Act 2007 Section 15(3)(d) added 1 April 2007 section 8(2) Student Loan Scheme Amendment Act 2007 Section 15(5) added 1 April 2005 section YA 2 Income Tax Act 2004 Section 15(5) amended 1 April 2008 section ZA 2(1) Income Tax Act 2007
16: Sections of Tax Administration Act 1994 and
Income Tax Act 2007 Sections 21 33 34 36 to 39 41 to 44 63 79 80 92 92A 106 to 111 113 114 section LC 10 section YA 1
a: every reference to a taxpayer were a reference to a borrower; and
b: every reference to the assessment and levy of income tax or tax were a reference to the assessment and levy of a repayment obligation; and
c: every reference to income tax were a reference to a repayment obligation. Section 16 heading substituted 24 October 2001 section 255(1) Taxation (Taxpayer Assessment and Miscellaneous Provisions) Act 2001 Section 16 heading amended 1 April 2008 section ZA 2(1) Income Tax Act 2007 Section 16 amended 1 April 2008 section ZA 2(1) Income Tax Act 2007 Section 16 amended 24 October 2001 section 255(2)(a) Taxation (Taxpayer Assessment and Miscellaneous Provisions) Act 2001 Section 16 amended 1 April 1995 Income Tax Act 1994 Repayment deductions from salary and wages
17: Borrowers to whom repayment deduction provisions of this Part apply
1: Sections 17B to 25
a: who reasonably expects that his or her gross tax year tax year
b: who is issued with a special repayment deduction rate certificate under section 21
2: Earnings from employment—
a:
b:
c: as a casual agricultural worker; or
d: as an election day worker,— (as those terms are defined in section YA 1 Section 17 heading amended 1 April 1999 Student Loan Scheme Amendment (No 2) Act 1998 Section 17(1) amended 25 November 2003 section 5(1) Student Loan Scheme Amendment Act (No 2) 2003 Section 17(1)(a) amended 1 April 2005 section YA 2 Income Tax Act 2004 Section 17(1)(a) amended 26 July 1996 Taxation (Core Provisions) Act 1996 Section 17(2) amended 1 April 2008 section ZA 2(1) Income Tax Act 2007 Section 17(2)(a) repealed 1 April 1999 section 3(1) Student Loan Scheme Amendment Act (No 2) 1998 Section 17(2)(b) repealed 1 April 1999 section 3(1) Student Loan Scheme Amendment Act (No 2) 1998 Section 17(2)(c) added 1 April 1995 Student Loan Scheme Amendment Act 1995 Section 17(2)(d) added 1 April 1995 Student Loan Scheme Amendment Act 1995
17B: Repayment codes for application of PAYE rules
For the purpose of the application of the PAYE rules of the Income Tax Act 2007 section 25 SL Section 17B inserted 25 November 2003 section 6(1) Student Loan Scheme Amendment Act (No 2) 2003 Section 17B amended 1 April 2008 section ZA 2(1) Income Tax Act 2007
18: Borrower's notice to employer of requirement for repayment deductions
1: A person who is a borrower and is in the employment of an employer (including an employer from whom secondary employment earnings are received) must give written notice under this section to the employer as soon as practicable after the later of—
a: the time at which the person becomes an employee of the employer; and
b: the time at which the person becomes a borrower.
2: A notice under this section must inform the employer that—
a: the borrower is required to have repayment deductions made under this Part from any amount paid to the borrower by way of salary or wages; and
b: the tax code prescribed by section 24B(3) SL Section 18 substituted 25 November 2003 section 7(1) Student Loan Scheme Amendment Act (No 2) 2003 Section 18(2)(b) amended 1 April 2008 section ZA 2(1) Income Tax Act 2007
19: Employer
or PAYE intermediary
1: If a borrower has given a notice under section 18 , or the Commissioner has given a notice under section 20A tax year
2: The deduction shall be made at the standard deduction rate or, if the employer is aware that or an increased repayment deduction rate
3: The repayment deductions made under this section shall be in addition to any tax deductions required to be made under the PAYE rules of the Income Tax Act 2007 1992 No 13 s 115(1) Section 19 heading amended 26 March 2003 section 5(1) Student Loan Scheme Amendment Act 2003 Section 19(1) substituted 26 March 2003 section 5(2) Student Loan Scheme Amendment Act 2003 Section 19(1) amended 7 March 2010 section 6(1) Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Act 2010 Section 19(1) amended 1 April 2005 section YA 2 Income Tax Act 2004 Section 19(2) amended 7 March 2010 section 6(2) Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Act 2010 Section 19(2) amended 28 March 2007 section 9 Student Loan Scheme Amendment Act 2007 Section 19(3) amended 1 April 2008 section ZA 2(1) Income Tax Act 2007 Section 19(3) amended 1 April 1995 Income Tax Act 1994
20: Standard deduction rate
1: The standard deduction rate shall be the rate of 10 cents in each complete dollar from—
a: so much of the primary employment earnings paid to the borrower as exceeds the proportional repayment threshold; and
b: any secondary employment earnings paid to the borrower; and
c: any extra emolument paid to the borrower.
2: For the purposes of this section, the proportional repayment threshold
a: where the salary or wages is paid weekly, an amount equal to one fifty-second of the repayment threshold; and
b: where the salary or wages is paid fortnightly, twice the amount specified in paragraph (a); and
c: where the salary or wages is paid three-weekly, 3 times the amount specified in paragraph (a); and
d: where the salary or wages is paid four-weekly, 4 times the amount specified in paragraph (a); and
e: where the salary or wages is paid monthly, the amount specified in paragraph (a) multiplied by 13 and divided by 3.
3: If the repayment percentage is changed by regulations made under section 87
20A: Standard deduction rate may be increased in certain circumstances
1: This section applies if—
a: the amount of a borrower's repayment deductions in the current tax year or in any tax year prior to the current tax year is, or was, less than the amount required under this Act; or
b: a borrower has failed to pay any amount that has become due and payable in accordance with this Act.
2: If this section applies, the Commissioner may, in relation to the borrower, issue an increased repayment deduction rate notice that—
a: varies the standard deduction rate by increasing it up to a maximum rate of 15 cents in each complete dollar; and
b: specifies the total amount payable by the borrower (which may include any penalties, interest, or other amount that has become due and payable); and
c: requires the borrower's employers to make repayment deductions at the increased rate until those repayment deductions equal the amount specified under paragraph (b).
3: If the Commissioner issues an increased repayment deduction rate notice, the Commissioner must send that notice, together with a notice that complies with section 18(2)
4: The increased repayment deduction rate applies until the earlier of the date on which—
a: the repayment deductions made in accordance with the increased repayment deduction rate notice equal the amount specified in subsection (2)(b); or
b: the Commissioner notifies the employer otherwise.
5: An increased repayment deduction rate notice issued in relation to a borrower under this section revokes—
a: any special repayment deduction rate certificate previously issued to that borrower; and
b: any notice previously given to an employer by that borrower in accordance with section 18
6: The Commissioner must give a borrower a copy of any notice that is given to that borrower's employers under this section as soon as practicable after it is issued.
7: Nothing in this section limits the application of sections 53 to 55D Section 20A inserted 7 March 2010 section 7 Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Act 2010
21: Special deduction rates
1: If a borrower wishes to vary the standard deduction rate, the borrower may apply by notice in writing to the Commissioner for the issue of a special repayment deduction rate certificate that takes into account the greater of—
a: the borrower's estimated repayment obligation for the tax year
b: some other amount required by the borrower.
2: Any borrower who has been issued with a special tax code certificate under section 24F net tax year
3: Section 24F Section 21(1) substituted 2 September 1996 section 46 Taxation (Remedial Provisions) Act 1996 Section 21(1)(a) amended 1 April 2005 section YA 2 Income Tax Act 2004 Section 21(2) amended 1 April 2008 section ZA 2(1) Income Tax Act 2007 Section 21(2) amended 1 April 2005 section YA 2 Income Tax Act 2004 Section 21(2) amended 26 July 1996 Taxation (Core Provisions) Act 1996 Section 21(3) amended 1 April 2008 section ZA 2(1) Income Tax Act 2007
22: Commissioner may assess amount of repayment deductions
1: If any question is raised as to the amount, if any, of any repayment deduction that ought to be made from any salary or wages, or any part thereof, it shall, subject to any regulations made for the purposes of this Part, be determined by the Commissioner.
2: As soon as practicable after making any such determination, the Commissioner shall make an assessment of any repayment deductions so determined. 1976 No 65 s 337(3)
23: Deductions from income-tested benefits
Notwithstanding section 20 chief executive Section 23 amended 19 September 2000 section 8 Student Loan Scheme Amendment Act 2000 Section 23 amended 1 October 1998 section 11 Employment Services and Income Support (Integrated Administration) Act 1998
24: Information to show repayment deductions made
1: Every employer or PAYE intermediary
2: The information required pursuant to subsection (1) shall be given in such manner as the Commissioner may reasonably require. Section 24(1) amended 26 March 2003 section 6(1) Student Loan Scheme Amendment Act 2003
25: PAYE rules of
Income Tax Act 2007
1: Subject to this section, the PAYE rules as defined in section YA 1 Income Tax Act 2007
a: every reference to income tax were a reference to a borrower's repayment obligation; and
b: every reference to withholding or deducting an amount of tax deductions; and
c: every reference to a tax code were a reference to a repayment code,— and every employer , PAYE intermediary, Income Tax Act 2007
2: Notwithstanding subsection (1), sections BC 1 LD 1(2) and (3) RC 2(1) RC 6 RC 7 RC 16 RC 17
3: Any repayment deduction made under this Part shall not be treated as part of or included in any tax deduction made under the PAYE rules of the Income Tax Act 2007 Section 25 substituted 1 April 1995 Income Tax Act 1994 Section 25 heading amended 1 April 2008 section ZA 2(1) Income Tax Act 2007 Section 25(1) amended 1 April 2008 section ZA 2(1) Income Tax Act 2007 Section 25(1) amended 25 November 2003 section 8(1) Student Loan Scheme Amendment Act (No 2) 2003 Section 25(1) amended 26 March 2003 section 7(1) Student Loan Scheme Amendment Act 2003 Section 25(1)(b) amended 1 April 2008 section ZA 2(1) Income Tax Act 2007 Section 25(1)(b) amended 25 November 2003 section 8(2) Student Loan Scheme Amendment Act (No 2) 2003 Section 25(1)(c) inserted 25 November 2003 section 8(2) Student Loan Scheme Amendment Act (No 2) 2003 Section 25(2) amended 1 April 2008 section ZA 2(1) Income Tax Act 2007 Section 25(2) amended 25 November 2003 section 8(4) Student Loan Scheme Amendment Act (No 2) 2003 Section 25(3) amended 1 April 2008 section ZA 2(1) Income Tax Act 2007 Interim repayments
26: Borrowers to whom interim repayment provisions of this Part apply
1: Sections 27 28 tax year tax year
2: The term residual repayment obligation tax year tax year
3: Every borrower to whom this section applies shall be a periodic payer who is obliged to make interim repayments towards the repayment obligation for the tax year sections 27 28
4: Notwithstanding subsections (1) to (3), a periodic payer shall have no liability to make interim repayments in respect of the net income for tax year tax year Section 26(1) amended 1 April 2005 section YA 2 Income Tax Act 2004 Section 26(2) amended 1 April 2005 section YA 2 Income Tax Act 2004 Section 26(3) amended 1 April 2005 section YA 2 Income Tax Act 2004 Section 26(4) amended 1 April 2005 section YA 2 Income Tax Act 2004 Section 26(4) amended 26 July 1996 Taxation (Core Provisions) Act 1996
27: Amount of interim repayments
1: The amount payable by a periodic payer by way of interim payments in respect of the net income for tax year tax year
2: The amount payable under subsection (1), may be varied in accordance with this Act and the provisions of the Income Tax Act 2007 section 28 Section 27(1) amended 1 April 2005 section YA 2 Income Tax Act 2004 Section 27(1) amended 26 July 1996 Taxation (Core Provisions) Act 1996 Section 27(2) amended 1 April 2008 section ZA 2(1) Income Tax Act 2007
28: Interim repayments to be paid in same manner as provisional tax
1: Subject to this section, interim repayments shall be payable in the same manner as provisional tax.
2: The provisional tax rules of the Income Tax Act 2007 and of the Tax Administration Act 1994
a: every reference to provisional tax were a reference to the amount of interim repayments payable by a periodic payer; and
b: every reference to a provisional taxpayer or a person liable to pay provisional tax
c: every reference to residual income tax were a reference to the amount of residual repayment obligation; and
d: every reference to income tax were a reference to the repayment obligation,— and every periodic payer shall comply with the requirements of that Part to the extent to which the Part applies by virtue of this section.
3: Notwithstanding subsection (1),—
a: sections RC 3 RC 5(2) section LB 2 a taxpayer's income tax liability
b: section RC 5(3)
i: shall apply only where the periodic payer's residual repayment obligation for the second preceding tax year
ii: shall apply as if, where the return for the immediately preceding tax year tax year date; and
c: section RC 8
d: section RC 9(4)(a)(i) and (ii) and (b)(i)
e: section RC 9(5)
f: sections RC 11 RC 16 to RC 19 RC 24 RC 31 Section 28(2) amended 1 April 2008 section ZA 2(1) Income Tax Act 2007 Section 28(2) amended 23 September 1997 section 2(1)(a) Student Loan Scheme Amendment Act 1997 Section 28(2) amended 1 April 1995 Income Tax Act 1994 Section 28(2)(b) amended 1 April 2008 section ZA 2(1) Income Tax Act 2007 Section 28(3)(a) substituted 1 April 1995 Income Tax Act 1994 Section 28(3)(a) amended 1 April 2008 section ZA 2(1) Income Tax Act 2007 Section 28(3)(a) amended 24 October 2001 section 256(1) Taxation (Taxpayer Assessment and Miscellaneous Provisions) Act 2001 Section 28(3)(b) amended 1 April 2008 section ZA 2(1) Income Tax Act 2007 Section 28(3)(b)(i) amended 1 April 2005 section YA 2 Income Tax Act 2004 Section 28(3)(b)(ii) amended 1 October 2007 section 300(1)(b)(ii) Taxation (Depreciation, Payment Dates Alignment, FBT, and Miscellaneous Provisions) Act 2006 Section 28(3)(b)(ii) amended 1 April 2005 section YA 2 Income Tax Act 2004 Section 28(3)(c) added 1 October 2007 section 300(1)(c) Taxation (Depreciation, Payment Dates Alignment, FBT, and Miscellaneous Provisions) Act 2006 Section 28(3)(c) amended 1 April 2008 section ZA 2(1) Income Tax Act 2007 Section 28(3)(d) added 1 October 2007 section 300(1)(c) Taxation (Depreciation, Payment Dates Alignment, FBT, and Miscellaneous Provisions) Act 2006 Section 28(3)(d) amended 1 April 2008 section ZA 2(1) Income Tax Act 2007 Section 28(3)(e) added 1 October 2007 section 300(1)(c) Taxation (Depreciation, Payment Dates Alignment, FBT, and Miscellaneous Provisions) Act 2006 Section 28(3)(e) amended 1 April 2008 section ZA 2(1) Income Tax Act 2007 Section 28(3)(f) added 1 October 2007 section 300(1)(c) Taxation (Depreciation, Payment Dates Alignment, FBT, and Miscellaneous Provisions) Act 2006 Section 28(3)(f) amended 1 April 2008 section ZA 2(1) Income Tax Act 2007 Terminal repayments
29: Borrowers to whom terminal repayment provisions of this Part apply
1: Section 30 tax year
a: any repayment deductions credited against the repayment obligation for the tax year
b: any interim repayments credited against the repayment obligation for the tax year
c: any voluntary payments made to the Commissioner and credited against the repayment obligation for the tax year
2: The amount by which the borrower's repayment obligation exceeds the sum of those amounts for any tax year terminal repayment obligation Section 29(1) amended 1 April 2005 section YA 2 Income Tax Act 2004 Section 29(1)(a) amended 1 April 2005 section YA 2 Income Tax Act 2004 Section 29(1)(b) amended 1 April 2005 section YA 2 Income Tax Act 2004 Section 29(1)(c) amended 1 April 2005 section YA 2 Income Tax Act 2004 Section 29(2) amended 1 April 2005 section YA 2 Income Tax Act 2004
30: Payment of terminal repayment obligation
1: A terminal repayment obligation for a tax year section YA 1 tax year
2: Notwithstanding subsection (1), where an assessment is not made until after the due date of the terminal repayment obligation, or is increased after the due date of the terminal repayment obligation, the Commissioner may, having regard to the circumstances of the case and if the Commissioner thinks it equitable to do so, fix a new date for the payment of the terminal repayment obligation, or part thereof, or of the increase, as the case may be, and the date so fixed shall be deemed to be the due date for the purposes of this Part. 1976 No 65 s 388(2) 1985 No 141 s 27(4) Section 30(1) substituted 26 March 2003 section 8(1) Student Loan Scheme Amendment Act 2003 Section 30(1) amended 1 April 2008 section ZA 2(1) Income Tax Act 2007 Section 30(1) amended 1 April 2005 section YA 2 Income Tax Act 2004
3: Collection of repayments from overseas based borrowers
Part 3 substituted 1 April 2007 section 10 Student Loan Scheme Amendment Act 2007
31: Definitions used in this Part
In this Part, unless the context otherwise requires,— opt-out period section 33(1) repayment holiday Section 31 substituted 1 April 2007 section 10 Student Loan Scheme Amendment Act 2007
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. Section 32 substituted 1 April 2007 section 10 Student Loan Scheme Amendment Act 2007
32A: Repayment obligations of non-resident borrowers
Section 32A repealed 1 April 2007 section 10 Student Loan Scheme Amendment Act 2007
32B: Interest chargeable
Section 32B repealed 1 April 2007 section 10 Student Loan Scheme Amendment Act 2007
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) may be given—
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. Section 33 substituted 1 April 2007 section 10 Student Loan Scheme Amendment Act 2007
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: x × y 365 where— x = the number of days in the tax year during which the borrower was overseas based y = one 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) applies to a borrower's loan balance, subsections (4) and (5) do not apply.
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 Section 34 substituted 1 April 2007 section 10 Student Loan Scheme Amendment Act 2007
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 Section 35 substituted 1 April 2007 section 10 Student Loan Scheme Amendment Act 2007
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. Section 36 substituted 1 April 2007 section 10 Student Loan Scheme Amendment Act 2007
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) 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 Section 36A inserted 1 April 2007 section 10 Student Loan Scheme Amendment Act 2007
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) does not apply if the amount assessed is zero. Section 36B inserted 1 April 2007 section 10 Student Loan Scheme Amendment Act 2007
4: Miscellaneous provisions applying to student loan scheme
Notification requirements
37: Borrower to advise Commissioner of absence from New Zealand
1: Any borrower who will be absent from New Zealand for a period of more than 6
a: either—
i: a permanent overseas address; or
ii: a New Zealand address to which any notice to the borrower may be delivered; or
iii: the name and address of a person in New Zealand empowered to act for the borrower; and
b: any information that the Commissioner reasonably requires in order to determine the borrower's overseas based ; and
c: any information that the Commissioner reasonably requires in order to determine whether the borrower is entitled to the full interest write-off set out in section 38AK
2: When a borrower who is absent from New Zealand becomes aware that he or she will be absent from New Zealand for a period of more than 6
3: Section 37(1) amended 1 April 2007 section 11(1) Student Loan Scheme Amendment Act 2007 Section 37(1)(b) amended 1 April 2007 section 11(2) Student Loan Scheme Amendment Act 2007 Section 37(1)(b) amended 22 December 2005 section 4(1) Student Loan Scheme Amendment Act 2005 Section 37(1)(c) added 22 December 2005 section 4(1) Student Loan Scheme Amendment Act 2005 Section 37(2) substituted 22 December 2005 section 4(2) Student Loan Scheme Amendment Act 2005 Section 37(2) amended 1 April 2007 section 11(3) Student Loan Scheme Amendment Act 2007 Section 37(3) repealed 22 December 2005 section 4(2) Student Loan Scheme Amendment Act 2005
38: Borrower Where any borrower to whom section 37 Section 38 heading: amended 22 December 2005 section 5 Student Loan Scheme Amendment Act 2005 Full interest write-off for borrowers present in New Zealand or granted an exemption Heading: substituted 22 December 2005 section 6 Student Loan Scheme Amendment Act 2005
38AA: Full interest write-off for certain borrowers
1: A borrower is entitled to the full interest write-off set out in section 38AK
a: the borrower satisfies the 183-day requirement in section 38AB
b: the Commissioner grants an exemption to the borrower under section 38AE , 38AJ 38AJA
2: The conditions in section 38AK(2) Section 38AA inserted 22 December 2005 section 7 Student Loan Scheme Amendment Act 2005 Section 38AA(1)(b) amended 7 March 2010 section 8 Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Act 2010
38AB: 183-day requirement
1: A borrower satisfies the 183-day requirement if that borrower is personally present in New Zealand for a period of 183 or more consecutive days after 31 March 2006 (a 183-day period
2: For the purposes of subsection (1), a borrower is treated as being personally present in New Zealand
a: he or she is personally absent from New Zealand for a period, or periods in the aggregate, of no more than 31 days during a period of what would otherwise have been a 183-day period; and
b: he or she is personally present in New Zealand for the first day of that 183-day period.
3: A borrower who satisfies the 183-day requirement is entitled to the full interest write-off set out in section 38AK section 38AC Section 38AB inserted 22 December 2005 section 7 Student Loan Scheme Amendment Act 2005
38AC: Full interest write-off ceases if borrower is personally absent from New Zealand for 184 days
1: A borrower who has satisfied the 183-day requirement in section 38AB 184-day absence
2: For the purposes of subsection (1), a borrower is treated as being personally absent from New Zealand
a: he or she is personally present in New Zealand for a period, or periods in the aggregate, of no more than 31 days during a period of what would otherwise have been a 184-day absence; and
b: he or she is personally absent from New Zealand for the first day of that 184-day absence.
3: However, a borrower must not be treated as being personally absent from New Zealand for any day on which that borrower may be treated as being personally present in New Zealand under section 38AB(2)
4: A borrower who has had a 184-day absence ceases to be entitled to the full interest write-off set out in section 38AK section 38AB
5: Subsection (4) is subject to the Commissioner granting an exemption to a borrower under section 38AE , 38AJ 38AJA Section 38AC inserted 22 December 2005 section 7 Student Loan Scheme Amendment Act 2005 Section 38AC(5) amended 7 March 2010 section 9 Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Act 2010
38AD: Treatment of partial days
For the purposes of sections 38AB to 38AK Section 38AD inserted 22 December 2005 section 7 Student Loan Scheme Amendment Act 2005
38AE: Power of Commissioner to grant exemptions to borrowers who do not satisfy 183-day requirement
1: On the application of a borrower who does not satisfy the 183-day requirement in section 38AB
a: the borrower was personally absent from New Zealand in the service in any capacity of the Government of New Zealand; or
b: the borrower was personally absent from New Zealand because he or she was working as a volunteer or for token payment for a charitable organisation that, at the time the borrower did that work, was charity
c: of an unexpected delay; or
d: of an unplanned personal absence; or
e: the borrower is required to be personally absent from New Zealand because of the borrower's employment or occupation; or
f: the borrower was personally absent from New Zealand because the borrower accompanied his or her wife or husband, civil union partner, or de facto partner ( partner ; or
g: the borrower was personally absent from New Zealand because he or she was in 1 or more of Niue, the Cook Islands, Tokelau, or the Ross Dependency.
2: If the Commissioner grants an exemption under subsection (1), the Commissioner must specify either—
a: the start and end dates for the period for which the relevant borrower is treated as being personally present in New Zealand for the purposes of section 38AB
b: the conditions that must apply or be met in order for the relevant borrower to be treated as being personally present in New Zealand for the purposes of section 38AB
3: The Commissioner may grant an exemption—
a: under subsection (1)(b) in respect of any one borrower for a maximum aggregate period of up to 24 months; and
b: under subsection (1)(f) in respect of any one borrower whose partner was personally absent from New Zealand because the partner was working as a volunteer or for token payment for a charity, for a maximum aggregate period of up to 24 months.
3A: The conditions in section 38AEA
4: The conditions in section 38AF
5: The conditions in section 38AG
6: The conditions in section 38AH
7: The conditions in section 38AI
7A: The conditions in section 38AIA
8: A borrower who applies to the Commissioner under this section must supply the Commissioner with all information, and in the manner, that the Commissioner may reasonably require in order to establish whether one of the grounds for the grant of an exemption in subsection (1)(a) to (g)
9: Subsections (1)(g) and (7A) apply with effect from 31 March 2009. Section 38AE inserted 22 December 2005 section 7 Student Loan Scheme Amendment Act 2005 Section 38AE(1)(b) amended 7 March 2010 section 10(1) Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Act 2010 Section 38AE(1)(f) amended 7 March 2010 section 10(2) Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Act 2010 Section 38AE(1)(g) added 7 March 2010 section 10(2) Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Act 2010 Section 38AE(3A) inserted 1 April 2007 section 12 Student Loan Scheme Amendment Act 2007 Section 38AE(7A) inserted 7 March 2010 section 10(3) Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Act 2010 Section 38AE(8) amended 7 March 2010 section 10(4) Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Act 2010 Section 38AE(9) added 7 March 2010 section 10(5) Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Act 2010
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 listed on the Organisation for Economic Cooperation and Development’s list of countries receiving development assistance
iii: work to raise the educational standards of a country that is listed on the Organisation for Economic Cooperation and Development’s list of countries receiving development assistance
b: provide the Commissioner with the information described in section 14A(2) Section 38AEA inserted 1 April 2007 section 13 Student Loan Scheme Amendment Act 2007 Section 38AEA(a)(ii) amended 7 March 2010 section 11 Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Act 2010 Section 38AEA(a)(iii) amended 7 March 2010 section 11 Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Act 2010
38AF: Conditions to unexpected delay exemption
An applicant under section 38AE(1)(c)
a: have been a resident during the time in question; and
b: provide proof—
i: of the applicant's intended return to New Zealand; and
ii: that if the applicant had returned to New Zealand as intended, the applicant would have satisfied the 183-day requirement in section 38AB
c: provide proof of the unexpected delay that resulted in the applicant not being able to return to New Zealand as intended; and
d: provide proof that the unexpected delay was due to an event or to circumstances beyond the reasonable control of the applicant, like (for example)—
i: an airline strike, personal illness, or death of a family member:
ii: a fire, flood, storm, earthquake, landslide, volcanic eruption, or other act of God:
iii: an explosion or nuclear, biological, or chemical contamination:
iv: sabotage, terrorism, or an act of war (whether declared or not). Section 38AF inserted 22 December 2005 section 7 Student Loan Scheme Amendment Act 2005
38AG: Conditions to unplanned personal absence exemption
An applicant under section 38AE(1)(d)
a: have been a resident during the time in question; and
b: provide proof of the duration of the applicant's unplanned personal absence from New Zealand; and
c: provide proof that the applicant's unplanned personal absence was due to an event or to circumstances beyond the reasonable planning and control of the applicant, like (for example)—
i: the illness or death of a family member who is overseas:
ii: the applicant's employer requiring the applicant to attend a conference overseas. Section 38AG inserted 22 December 2005 section 7 Student Loan Scheme Amendment Act 2005
38AH: Conditions to employment or occupation absence exemption
An applicant under section 38AE(1)(e)
a: have been a resident during the time in question; and
b: have a permanent place of abode only in New Zealand; and
c: provide proof that the applicant receives either—
i: a PAYE income payment as defined in section RD 3(1)
ii: income from a business that has a permanent place of business in New Zealand; and
d: provide proof that the majority of the applicant's personal absences from New Zealand are because of the applicant's employment or occupation. Section 38AH inserted 22 December 2005 section 7 Student Loan Scheme Amendment Act 2005 Section 38AH(c)(i) substituted 28 March 2007 section 14(1) Student Loan Scheme Amendment Act 2007 Section 38AH(c)(i) amended 1 April 2008 section ZA 2(1) Income Tax Act 2007
38AI: Conditions to marriage, civil union, or de facto exemption
An applicant under section 38AE(1)(f)
a: have been a resident during the time in question; and
b: provide proof of the applicant's relationship with his or her wife or husband, civil union partner, or de facto partner ( partner
c: provide proof that the applicant's personal absence from New Zealand was because the applicant was accompanying his or her partner overseas; and
d: provide proof that one of the following applies:
i: the applicant's partner was personally absent from New Zealand—
A: in the service in any capacity of the Government of New Zealand; or
B: because he or she was working as a volunteer or for token payment for a charitable organisation named in regulations made under this Act; or
ii: the applicant's partner satisfies the conditions in section 38AH
iii: the applicant's partner satisfies the conditions in section 38AJ(2) ; or
iv: the applicant's partner satisfies the conditions in section 38AJA(4) Section 38AI inserted 22 December 2005 section 7 Student Loan Scheme Amendment Act 2005 Section 38AI(d)(iii) amended 7 March 2010 section 12 Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Act 2010 Section 38AI(d)(iv) added 7 March 2010 section 12 Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Act 2010
38AIA: Conditions to Niue, Cook Islands, Tokelau, and Ross Dependency exemption
1: An applicant under section 38AE(1)(g)
a: provide proof that he or she—
i: was personally present in 1 or more of New Zealand, Niue, the Cook Islands, Tokelau, or the Ross Dependency for a period of 183 or more consecutive days after 31 March 2009 (a 183-day period
ii: was personally present in New Zealand, Niue, the Cook Islands, Tokelau, or the Ross Dependency for the first day of the 183-day period; and
iii: was not personally absent from New Zealand, Niue, the Cook Islands, Tokelau, and the Ross Dependency for a period, or periods in the aggregate, of more than 31 days during a period of what would otherwise have been a 183-day period; and
b: pay his or her repayment obligation in full when, or before, it falls due each tax year; and
c: provide the Commissioner with the information described in section 14A(2)
2: In specifying under section 38AE(2) section 38AE(1)(g) section 38AB sections 38AC(1) to (4) 38AD New Zealand New Zealand (which includes Niue, the Cook Islands, Tokelau, and the Ross Dependency) section 38AK(2)(b) Section 38AIA inserted 7 March 2010 section 13 Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Act 2010
38AJ: Power of Commissioner to grant exemption to borrowers undertaking
study at post-graduate or under-graduate level overseas
1: On the application of a borrower who does not satisfy the 183-day requirement in section 38AB or under-graduate
2: An applicant under subsection (1)—
a: must provide the Commissioner with a document from the NZQA verifying that the applicant's or under-graduate
b: must provide the Commissioner with evidence from the applicant's overseas education provider verifying that the applicant is enrolled full-time in the
c: must supply the Commissioner with all other information, and in the manner, that the Commissioner may reasonably require in order to establish whether the ground for the grant of an exemption under subsection (1) applies ; and
d: must provide the Commissioner with the information specified in section 14A(2)
3: If the Commissioner grants an exemption under subsection (1), the Commissioner must specify either—
a: the start and end dates for the period for which the relevant borrower is treated as being personally present in New Zealand for the purposes of section 38AB
b: the conditions that must apply or be met in order for the relevant borrower to be treated as being personally present in New Zealand for the purposes of section 38AB
4: In this section,— NZQA Part 20 study at post-graduate or under-graduate level 7, section 253(1)(c) Section 38AJ inserted 22 December 2005 section 7 Student Loan Scheme Amendment Act 2005 Section 38AJ heading amended 1 April 2007 section 15(1) Student Loan Scheme Amendment Act 2007 Section 38AJ(1) amended 1 April 2007 section 15(2) Student Loan Scheme Amendment Act 2007 Section 38AJ(2)(a) amended 1 April 2007 section 15(3)(a) Student Loan Scheme Amendment Act 2007 Section 38AJ(2)(a) amended 1 April 2007 section 15(3)(b) Student Loan Scheme Amendment Act 2007 Section 38AJ(2)(b) amended 1 April 2007 section 15(4) Student Loan Scheme Amendment Act 2007 Section 38AJ(2)(c) amended 1 April 2007 section 15(5) Student Loan Scheme Amendment Act 2007 Section 38AJ(2)(d) added 1 April 2007 section 15(5) Student Loan Scheme Amendment Act 2007 Section 38AJ(4) study at post-graduate or under-graduate level amended 1 April 2007 section 15(6)(a) Student Loan Scheme Amendment Act 2007 Section 38AJ(4) study at post-graduate or under-graduate level amended 1 April 2007 section 15(6)(b) Student Loan Scheme Amendment Act 2007
38AJA: Power of Commissioner to grant exemption to borrowers undertaking full-time overseas study
1: On the application of a borrower who does not satisfy the 183-day requirement in section 38AB
2: This subsection applies if the principal reason that the borrower does not satisfy the 183-day requirement is that the borrower is undertaking study that—
a: the borrower is enrolled in with a New Zealand tertiary education provider; and
b: if it is completed successfully, will count towards a qualification offered by a New Zealand tertiary education provider; and
c: is assessed by the NZQA as being equivalent to level 7 or above on the New Zealand Register of Quality Assured Qualifications developed by the NZQA under section 253(1)(c)
d: is full-time and undertaken overseas as part of either—
i: a formal exchange programme approved by the New Zealand Government; or
ii: a formal agreement between a New Zealand tertiary education provider and an overseas tertiary provider.
3: This subsection applies if the principal reason that the borrower does not satisfy the 183-day requirement is that the borrower is undertaking study that—
a: the borrower is enrolled in with a New Zealand tertiary education provider; and
b: if it is completed successfully, will count towards a qualification offered by a New Zealand tertiary education provider; and
c: is assessed by the NZQA as being equivalent to level 8 or above on the New Zealand Register of Quality Assured Qualifications developed by the NZQA under section 253(1)(c)
d: is full-time and undertaken overseas; and
e: cannot be completed in New Zealand.
4: An applicant under subsection (1)—
a: must provide the Commissioner with evidence from the applicant's New Zealand tertiary education provider verifying that the applicant's study meets the requirements of either—
i: subsection (2)(b), (c), and (d)(i) or (ii); or
ii: subsection (3)(b) to (e); and
b: must supply the Commissioner with all other information, and in the manner, that the Commissioner may reasonably require in order to establish whether the ground for the grant of an exemption under subsection (1) applies; and
c: must provide the Commissioner with the information specified in section 14A(2)
5: If the Commissioner grants an exemption under subsection (1), the Commissioner must specify either—
a: the start and end dates for the period for which the relevant borrower is treated as being personally present in New Zealand for the purposes of section 38AB
b: the conditions that must apply or be met in order for the relevant borrower to be treated as being personally present in New Zealand for the purposes of section 38AB
6: In this section,— NZQA Part 20 overseas tertiary provider
a: provides tertiary education or training; and
b: is based in a country other than New Zealand; and
c: is registered by an appropriate education authority in that country.
7: This section applies with effect from 31 March 2007. Section 38AJA inserted 7 March 2010 section 14 Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Act 2010
38AK: Terms of full interest write-off
1: When a borrower is entitled to a full interest write-off under section 38AA
2: Subsection (1)—
a: applies only to days on or after 1 April 2006 on which a borrower—
i: is personally present in New Zealand in accordance with the requirements of sections 38AB to 38AD
ii: is treated as being personally present in New Zealand under section 38AB(2) , 38AE(2) 38AJ(3) 38AJA(5)
b: does not apply to the days on which a borrower is personally present in New Zealand but is treated as being personally absent from New Zealand under section 38AC(2) Section 38AK inserted 22 December 2005 section 7 Student Loan Scheme Amendment Act 2005 Section 38AK(2)(a)(ii) amended 7 March 2010 section 15 Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Act 2010
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), the Commissioner must specify the start and end dates for the period for which the amount of interest is reduced to zero.
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 Section 38AL inserted 28 March 2007 section 16 Student Loan Scheme Amendment Act 2007
38AM: Full interest write-off for quick repayment of loan balance
1: This section applies to a borrower who—
a: satisfies the 183-day requirement in section 38AB(1) and (2)
b: fully repays his or her loan balance before the end of the 183-day period.
2: The amount of interest calculated on the loan balance of a borrower to whom this section applies must be reduced to zero for the period—
a: beginning on the first day of the 183-day period; and
b: ending on the day on which the borrower fully repays his or her loan balance.
3: This section applies with effect from 31 March 2006. Section 38AM inserted 7 March 2010 section 16 Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Act 2010 Full interest write-off for certain students Heading: repealed 1 April 2007 section 17(1) Student Loan Scheme Amendment Act 2007
38A: Full interest write-off for full-time, full-year students
Section 38A repealed 1 April 2007 section 17(2) Student Loan Scheme Amendment Act 2007
38B: Full interest write-off for part-time or part-year students
Section 38B repealed 1 April 2007 section 17(2) Student Loan Scheme Amendment Act 2007
38C: Amount of full interest write-off
Section 38C repealed 1 April 2007 section 17(2) Student Loan Scheme Amendment Act 2007
38D: Conditions for full-interest write-off
Section 38D repealed 1 April 2007 section 17(2) Student Loan Scheme Amendment Act 2007 Base interest write-off Heading: repealed 1 April 2007 section 17(1) Student Loan Scheme Amendment Act 2007
39: Base interest write-off where income below repayment threshold
Section 39 repealed 1 April 2007 section 17(2) Student Loan Scheme Amendment Act 2007 Interest reduction Heading repealed 1 April 2007 section 17(1) Student Loan Scheme Amendment Act 2007
40: Interest reduction where base interest exceeds 50% of repayment obligation
Section 40 repealed 1 April 2007 section 17(2) Student Loan Scheme Amendment Act 2007
41: Conditions for base interest write-off
Section 41 repealed 1 April 2007 section 17(2) Student Loan Scheme Amendment Act 2007 Other provisions relating to interest
42: Interest adjustment in respect of credit balances
1: Except as provided in this section, no interest shall be payable on any credit balance.
2: Where a repayment deduction has been made in respect of any borrower or a borrower has, in any tax year
3: Notwithstanding subsection (2), the amount of the reduction made in accordance with the said subsection (2) shall not exceed the interest transferred to the Commissioner for collection.
4: Nothing in this section limits the application of section 120 Tax Administration Amendment Act (No 2) 1996
a: where it applies by virtue of section 36(2)
b: which is to be construed as if—
i: references in that section to a competent objection were references to a challenge a borrower is entitled to make under Part 8A Part 5
ii: the proviso to section 120(1) provided that where the amount of the disputed repayment obligation that has been paid is less than $100 no interest shall be payable under this section.
iii: all other changes necessary to give effect to this section were made. Section 42(2) amended 1 April 2005 section YA 2 Income Tax Act 2004 Section 42(4) substituted 1 October 1996 section 4(1) Student Loan Scheme Amendment Act 1996
43: Interest statement
1: The Commissioner shall, as soon as practicable after the end of any tax year tax year tax year
2: Except where the person establishes by proceedings under Part 8A
3: Subsection (2) does not prevent the Commissioner from amending the amount of interest charged if this is necessary to correct an error.
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. Section 43(1) amended 1 April 2005 section YA 2 Income Tax Act 2004 Section 43(2) amended 1 October 1996 section 5(1) Student Loan Scheme Amendment Act 1996 Section 43(3) added 28 March 2007 section 18 Student Loan Scheme Amendment Act 2007 Section 43(4) added 28 March 2007 section 18 Student Loan Scheme Amendment Act 2007 Penalties for late payment
44: Late payment penalties
1: A borrower is liable to pay a late payment penalty if the borrower does not pay by the due date—
a: any part of a terminal repayment obligation; or
b: any part of an instalment of an interim repayment; or
c: any part of an overseas based
d: any amount, being a loan balance or interest, that is payable as a result of a demand made under a loan contract ; or
e: any underestimation penalty imposed under section 44A
2: The late payment penalty the borrower is liable to pay under subsection (1) is—
a: 1.5%
b: 1.5%
3: For the purposes of this section— amount of the default
a: in respect of a terminal repayment obligation, the amount of the terminal repayment obligation not paid by the due date:
b: in respect of an interim repayment, the amount that is the smallest of—
i: the difference between 105% of the residual repayment obligation for the immediately preceding tax year
ii: the difference between the residual repayment obligation for the tax year
iii: the difference between the amount of the interim repayment last notified by the Commissioner as due by the third instalment date and the amount of the interim repayments made:
c: the amount of any instalment of an interim repayment due after the third instalment date not paid by the due date:
d: in respect of an overseas based overseas based tax year and includes the amount of any late payment penalty payable under this section due date
a: for a terminal repayment obligation, the date specified in Schedule 3
b: for any instalment of an interim repayment due on or before the third instalment date, the date specified in Schedule 3
c: for any instalment of an interim repayment due after the third instalment date, the date specified in the notice of assessment as the due date:
d: for an overseas based tax year Section 44 substituted 26 July 1996 section 6(1) Student Loan Scheme Amendment Act 1996 Section 44(1)(c) amended 1 April 2007 section 19(1) Student Loan Scheme Amendment Act 2007 Section 44(1)(d) amended 7 March 2010 section 17 Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Act 2010 Section 44(1)(e) added 23 September 1997 section 4 Student Loan Scheme Amendment Act 1997 Section 44(2)(a) amended 1 April 2007 section 19(2) Student Loan Scheme Amendment Act 2007 Section 44(2)(b) amended 1 April 2007 section 19(2) Student Loan Scheme Amendment Act 2007 Section 44(3) amount of the default amended 1 April 2007 section 19(3)(a) Student Loan Scheme Amendment Act 2007 Section 44(3) amount of the default amended 1 April 2007 section 19(3)(b) Student Loan Scheme Amendment Act 2007 Section 44(3) amount of the default amended 1 April 2005 section YA 2 Income Tax Act 2004 Section 44(3) due date amended 1 April 2008 section ZA 2(1) Income Tax Act 2007 Section 44(3) due date amended 1 April 2008 section ZA 2(1) Income Tax Act 2007 Section 44(3) due date amended 1 April 2007 section 19(4) Student Loan Scheme Amendment Act 2007 Section 44(3) due date amended 1 April 2005 section YA 2 Income Tax Act 2004
44A: Underestimation penalty where interim repayments underestimated as at final instalment date
1: If, at the due date for payment of the third instalment, a periodic payer has estimated the interim
a: the estimate applying at the third instalment date is less than 80% of the periodic payer's residual interim
b: the amount of interim repayments made on or before the third instalment date is less than 80% of the periodic payer's residual tax year the person (subject to subsection (3)) is liable to pay to the Commissioner, by way of penalty, an amount calculated in accordance with subsection (2).
2: In relation to any tax year (a − b) × 10% where— a is the periodic payer's residual tax year b is the greater of—
i: the amount of the periodic payer's estimate, being that estimate applying at the due date for payment of the third instalment; and
ii: the amount of the interim repayments paid on or before the due date for payment of the third instalment.
3: If the Commissioner is satisfied that a periodic payer has become liable for underestimation penalty for a tax year
a: the enactment of any Act amending the Income Tax Act 2007 tax year tax year
b: the Commissioner making public, on or after 1 March in that tax year tax year Income Tax Act 2007
c: the adoption by the person of an incorrect tax position which is corrected for the tax year the Commissioner shall, to the extent that the penalty is higher than it would otherwise have been, write off the penalty or a part thereof.
4: A penalty imposed under this section is deemed to be due and payable on—
a: the seventh day of the month specified in Schedule 13
b: 15 January, when January is the month specified in Schedule 3 Section 44A inserted 23 September 1997 section 5 Student Loan Scheme Amendment Act 1997 Section 44A(1) amended 25 November 2003 section 9(1)(a) Student Loan Scheme Amendment Act (No 2) 2003 Section 44A(1)(a) amended 25 November 2003 section 9(1)(b) Student Loan Scheme Amendment Act (No 2) 2003 Section 44A(1)(a) amended 25 November 2003 section 9(1)(c) Student Loan Scheme Amendment Act (No 2) 2003 Section 44A(1)(b) amended 1 April 2005 section YA 2 Income Tax Act 2004 Section 44A(1)(b) amended 25 November 2003 section 9(1)(d) Student Loan Scheme Amendment Act (No 2) 2003 Section 44A(2) amended 1 April 2005 section YA 2 Income Tax Act 2004 Section 44A(2) amended 1 April 2005 section YA 2 Income Tax Act 2004 Section 44A(2) amended 25 November 2003 section 9(2) Student Loan Scheme Amendment Act (No 2) 2003 Section 44A(3) amended 1 April 2005 section YA 2 Income Tax Act 2004 Section 44A(3)(a) amended 1 April 2008 section ZA 2(1) Income Tax Act 2007 Section 44A(3)(a) amended 1 April 2005 section YA 2 Income Tax Act 2004 Section 44A(3)(b) amended 1 April 2008 section ZA 2(1) Income Tax Act 2007 Section 44A(3)(b) amended 1 April 2005 section YA 2 Income Tax Act 2004 Section 44A(3)(c) amended 1 April 2005 section YA 2 Income Tax Act 2004 Section 44A(4)(a) amended 1 April 2005 section YA 2 Income Tax Act 2004 Section 44A(4)(b) amended 1 April 2008 section ZA 2(1) Income Tax Act 2007
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) applies—
a: despite any provision in a loan contract; and
b: with effect from 1 April 1992. Section 44B inserted 28 March 2007 section 20 Student Loan Scheme Amendment Act 2007
45: Notification of penalties
The Commissioner shall, as soon as practicable after charging a penalty, give the person charged with that penalty written notice of the amount of that penalty. Ten percent bonus for excess repayments Heading substituted 1 April 2010 section 4 Student Loan Scheme (Repayment Bonus) Amendment Act 2009
45A: Interpretation
In this section and sections 45B to 45H 10% bonus section 45C(2) 45D(2) 45E(2) excess repayment section 45B final excess repayment Section 45A substituted 1 April 2010 section 4 Student Loan Scheme (Repayment Bonus) Amendment Act 2009
45B: Meaning of excess repayment
1: For the purposes of this Act, an excess repayment
2: However, the following are not excess repayments:
a: any amount paid in respect of a tax year when a repayment obligation, repayment deduction, interim repayment, terminal repayment obligation, or penalty is, or will be, due and payable in respect of that tax year or any prior tax year (the due amount
b: any amount that was paid before 1 April 2009:
c: any amount that is paid in respect of a tax year that ended on or before 31 March 2009.
3: Excess repayments may be made—
a: by any means, including repayment deductions, interim repayments, and voluntary payments; and
b: in 1 or more payments in respect of a tax year; and
c: in respect of a tax year, at any time during that tax year and, if the borrower is a periodic payer, at any time up to and including the due date for payment of the final instalment of that borrower's interim repayments for that tax year. Section 45B substituted 1 April 2010 section 4 Student Loan Scheme (Repayment Bonus) Amendment Act 2009
45C: Borrower's entitlement to 10% bonus for total excess repayments of $500 or more
1: Subsection (2) applies to a borrower if—
a: the borrower's total excess repayments in respect of a tax year are $500 or more; and
b: at the beginning of the tax year in respect of which the excess repayments were made, the borrower's IRD loan balance was $550 or more.
2: If this subsection applies to a borrower, the Commissioner must reduce the borrower's IRD loan balance by an amount equal to 10% of the borrower's total excess repayments in respect of the relevant tax year. Section 45C substituted 1 April 2010 section 4 Student Loan Scheme (Repayment Bonus) Amendment Act 2009
45D: Borrower's entitlement to bonus if IRD loan balance is less than $550
1: Subsection (2) applies to a borrower if—
a: the borrower's final excess repayment in respect of a tax year is $500; and
b: at the date on which the final excess repayment was made, the borrower's IRD loan balance was more than $500 but less than $550.
2: If this subsection applies to a borrower, the Commissioner must reduce the borrower's IRD loan balance to zero. Section 45D substituted 1 April 2010 section 4 Student Loan Scheme (Repayment Bonus) Amendment Act 2009
45E: Borrower may be entitled to 10% bonus if under-deduction is due to PAYE system
1: Subsection (2) applies to a borrower if—
a: the borrower's total excess repayments in respect of a tax year are less than $500; and
b: the difference between the borrower's total excess repayments in respect of that tax year and $500 (the shortfall
c: the shortfall meets 1 or more of the following criteria:
i: it is less than $20:
ii: it is due to the borrower commencing or ceasing employment:
iii: it is due to an action or an omission of the borrower's employer; and
d: the Commissioner considers that the borrower's total excess repayments in respect of that tax year would have been $500 or more if the under-deduction referred to in paragraph (b) had not occurred; and
e: at the beginning of the tax year in respect of which the excess repayments were made, the borrower's IRD loan balance was $550 or more.
2: If this subsection applies to a borrower, the Commissioner must reduce the borrower's IRD loan balance by an amount equal to 10% of the borrower's total excess repayments in respect of the relevant tax year that the Commissioner considers would have been made if the under-deduction referred to in subsection (1)(b) had not occurred. Section 45E inserted 1 April 2010 section 4 Student Loan Scheme (Repayment Bonus) Amendment Act 2009
45F: Manner in which 10% bonus is to be provided and restriction on amount of 10% bonus
1: If a borrower's IRD loan balance will be fully repaid as a result of it being reduced by a 10% bonus, that bonus must be credited to that borrower's IRD loan balance as at the date on which the final excess repayment was made.
2: If a borrower's loan balance will not be fully repaid as a result of being reduced by a 10% bonus, that bonus must be credited to the borrower's loan balance with effect from—
a: 1 April in the tax year that follows the tax year for which the excess repayments were made; or
b: any other date that the Commissioner considers appropriate if the borrower dies or is declared bankrupt.
3: Nothing in subsection (1) or (2) requires the Commissioner to credit a 10% bonus to a borrower's IRD loan balance before the Commissioner has determined that borrower's total excess repayments in respect of a tax year.
4: The total amount of a 10% bonus that may be provided to a borrower must not exceed an amount equal to one-eleventh of that borrower's IRD loan balance on either—
a: the date on which the 10% bonus is provided; or
b: an earlier date determined by the Commissioner, at his or her discretion, that is within the relevant tax year.
5: The Commissioner may only determine a date under subsection (4)(b) if, in respect of a borrower,—
a: 1 or more excess repayments are made in respect of a tax year; and
b: a final excess repayment was made in respect of the same tax year. Section 45F inserted 1 April 2010 section 4 Student Loan Scheme (Repayment Bonus) Amendment Act 2009 Section 45F(2) substituted 30 August 2011 section 222 Student Loan Scheme Act 2011
45G: Consequences of refund
1: If a borrower elects that the whole or part of an excess repayment in respect of a tax year be refunded, any 10% bonus that was provided to that borrower must be reduced to an amount equal to 10% of the remaining excess repayment (if any) in respect of the tax year that is $500 or more.
2: If the 10% bonus was provided under section 45E(2) section 45E section 45E(1)(b) Section 45G inserted 1 April 2010 section 4 Student Loan Scheme (Repayment Bonus) Amendment Act 2009
45H: Commissioner must advise borrowers to seek financial advice
The Commissioner must, in all material that provides information about repayment bonuses and that is made available to all borrowers, include a statement to the effect that borrowers are advised to seek appropriate financial advice before making excess repayments in order to obtain a 10% bonus. Section 45H inserted 1 April 2010 section 4 Student Loan Scheme (Repayment Bonus) Amendment Act 2009
45I: Application of sections 45A to 45H
Sections 45A to 45H Section 45I inserted 1 April 2010 section 4 Student Loan Scheme (Repayment Bonus) Amendment Act 2009 Enforcement
46: Recovery of repayment obligation
1: Any amount payable under this Act by a borrower shall be recoverable as a debt due to the Crown.
2: Sections 156 to 165
a: every reference in those provisions to income tax were a reference to a repayment obligation; and
b: the reference to an assessment in section 162 Part 2 Part 3
c: every reference to this Act sections 164 165 1985 No 141 s 44 Section 46(2) amended 28 March 2007 section 22 Student Loan Scheme Amendment Act 2007 Section 46(2) amended 1 April 1995 Income Tax Act 1994 Section 46(2)(b) amended 1 April 1995 Income Tax Act 1994 Section 46(2)(c) amended 1 April 1995 Income Tax Act 1994 Date on which payments due
47: Payment date not otherwise specified
Any amount not otherwise due and payable in accordance with this Act shall be due and payable 1 month after the date of issue of the assessment or notice. Dates on which payments deemed to be received and credited
48: Date on which payments deemed to have been made
Any payment made under this Act shall be deemed to have been made on the date on which it was received by the Commissioner.
49: Date on which payments deemed to have been credited
1: For the purpose of calculating interest payable,—
a: any payment other than a repayment deduction shall be deemed to have reduced the IRD loan balance by the amount of that payment on the day it was made; and
b: any repayment deduction shall be deemed to have reduced the IRD loan balance by the amount of that deduction on the 15th day of the month in which the deduction was made from the borrower's salary or wages.
2: Other than for the purpose of calculating interest, any payment made under this Act or under the loan contract in a tax year that tax year Section 49(2) amended 1 April 2005 section YA 2 Income Tax Act 2004 Section 49(2) amended 1 April 2005 section YA 2 Income Tax Act 2004
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. Section 50 substituted 28 March 2007 section 23 Student Loan Scheme Amendment Act 2007 Relief
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 $334
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. Section 51 substituted 1 October 2007 section 24 Student Loan Scheme Amendment Act 2007 Section 51(3)(a) amended 7 March 2010 section 18 Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Act 2010
51A: Commissioner may refrain from collecting amounts between $5 and $333
Section 51A expired 1 October 2007 section 51A(4)
52: No liability in respect of small amounts of penalty
1: The Commissioner shall not charge, and there shall be no liability to pay, any penalty imposed in respect of any default in paying any repayment obligation or other amount by its due date where the amount of the penalty calculated in respect of that default does not exceed $5 (or such other amount as the Governor-General may, from time to time, by Order in Council declare for the purposes of this section).
2: Where the amount of any penalty initially calculated in respect of any default does not exceed $5 (or such other amount as may be declared under subsection (1)),—
a: the amount so calculated shall be deemed not to be a penalty, and shall not be added to the amount in default; and
b: no further amount of penalty shall be added under the relevant provision in respect of any further period during which the default continues.
3: This section applies only to borrowers' obligations under this Act. 1976 No 65 s 411A Section 52(3) added 1 April 1997 section 7(1) Student Loan Scheme Amendment Act 1996
53: Relief from penalty
1: Where any penalty is payable by a person under this Act in relation to any default by that person, on application for relief made
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.
2: The payment of the penalty, in whole or in part, shall not preclude the Commissioner from granting relief from that penalty in accordance with subsection (1).
3: If the amount of any penalty is reduced, the Commissioner shall apply any amount overpaid in accordance with section 56 section 57
4: This section applies only to borrowers' obligations under this Act. 1976 No 65 s 413 Section 53(1) amended 28 March 2007 section 26(1) Student Loan Scheme Amendment Act 2007 Section 53(1A) inserted 28 March 2007 section 26(2) Student Loan Scheme Amendment Act 2007 Section 53(1B) inserted 28 March 2007 section 26(2) Student Loan Scheme Amendment Act 2007 Section 53(4) added 1 April 1997 section 8 Student Loan Scheme Amendment Act 1996
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 any tax year 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) must be made on or before 31 March in the tax year that immediately precedes the tax year for which relief is sought.
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. Section 54 substituted 1 April 2007 section 27 Student Loan Scheme Amendment Act 2007 Section 54(1)(a) substituted 7 March 2010 section 19 Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Act 2010
55: Hardship relief for any tax year prior to current tax year
1: If an application is made under section 54(1)(a)
a: is satisfied that payment of that repayment obligation is causing, or would cause, serious hardship to the borrower; or
b: considers that there are other special reasons that make it fair and reasonable to do so.
2: Except as set out in section 55A Section 55 substituted 7 March 2010 section 20 Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Act 2010
55A: Hardship relief for tax year immediately prior to current tax year may include refund
1: If an application is made under section 54(1)(a)
a: is satisfied that payment of that repayment obligation is causing, or would cause, serious hardship to the borrower; or
b: considers that there are other special reasons that make it fair and reasonable to do so.
2: If the Commissioner refunds any amount to a borrower under subsection (1), the Commissioner must—
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.
3: A refund that is made under this section must be made in the manner required under section 184A Section 55A substituted 7 March 2010 section 20 Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Act 2010
55B: Hardship relief for current tax year or next tax year
1: If an application is made under section 54(1)(b) or (c)
a: 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
b: considers that there are other special reasons that make it fair and reasonable to do so.
2: If the Commissioner reduces the amount to be deducted or paid by a borrower under subsection (1), the Commissioner must, as appropriate, do one of the following:
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 subsection (1) and, when assessed, reduce that borrower's repayment obligation accordingly; or
b: reduce the percentage payable by that borrower under section 27(1)
c: reduce that borrower's repayment obligation under section 34
3: If the Commissioner reduces the amount to be deducted from, or paid by, a borrower to zero, section 18
4: If a borrower has given his or her employer notice in accordance with section 18
5: Section 24F Section 55B substituted 7 March 2010 section 20 Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Act 2010
55C: Effect of Commissioner's decision under
section 55, 55A, or 55B
1: Any amount that, as a result of a decision under section 55 55A 55B
2: Section 56 57 Section 55C inserted 1 April 2007 section 27 Student Loan Scheme Amendment Act 2007 Section 55C heading amended 7 March 2010 section 21(1) Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Act 2010 Section 55C(1) amended 7 March 2010 section 21(2) Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Act 2010
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 55A 55B
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. Section 55D inserted 1 April 2007 section 27 Student Loan Scheme Amendment Act 2007 Section 55D(1)(b) amended 7 March 2010 section 22 Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Act 2010 Refunds
56: Excess repayments made by
borrowers
1: Where for any tax year
a: had repayment deductions made in excess of the repayment obligation for that tax year
b: paid interim repayments in excess of the repayment obligation for that tax year
c: paid an amount in excess of the amount of any instalment of an interim repayment; or
d: made a voluntary payment in excess of the repayment obligation for that tax year
e: paid an amount in excess of the amount of any penalty charged,— the Commissioner shall—
f: credit the amount so deducted or paid in excess, so far as it extends, to any repayment obligation or instalment of an interim repayment for any other tax year and apply any amount not so credited in accordance with either subsection (1A) or (1B).
g:
1A: A borrower may elect that the whole or part of the amount not credited—
a: be refunded; or
b: be applied to the loan balance.
1B: Where a borrower does not make an election, the Commissioner must apply the amount not credited to the loan balance.
2: Any election under subsection (1A)(b)
2A: Where a borrower has not made an election, the borrower may request the Commissioner, within 6 months of the date on which the Commissioner issued the notice of assessment that showed the amount applied to the loan balance, to refund, in whole or in part, the amount so credited.
2B: A refund that is made under this section must comply with section 184A
3: Notwithstanding subsection (1), no refund shall be made under this section after the expiry of the period of 8 years immediately after the end of the year in which the assessment was made or, in any case where the original assessment has been altered (whether once or more than once) after the end of the year in which the original assessment was made, unless written application for the refund is made by or on behalf of the borrower before the expiry of that period. 1976 No 65 s 409(1) Section 56 heading amended 7 March 2010 section 23 Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Act 2010 Section 56(1) amended 1 April 2005 section YA 2 Income Tax Act 2004 Section 56(1)(a) amended 1 April 2005 section YA 2 Income Tax Act 2004 Section 56(1)(b) amended 1 April 2005 section YA 2 Income Tax Act 2004 Section 56(1)(d) amended 1 April 2005 section YA 2 Income Tax Act 2004 Section 56(1)(f) amended 1 April 2005 section YA 2 Income Tax Act 2004 Section 56(1)(f) amended 27 March 1998 section 2(1) Student Loan Scheme Amendment Act 1998 Section 56(1)(g) repealed 27 March 1998 section 2(2) Student Loan Scheme Amendment Act 1998 Section 56(1A) inserted 27 March 1998 section 2(3) Student Loan Scheme Amendment Act 1998 Section 56(1B) inserted 27 March 1998 section 2(3) Student Loan Scheme Amendment Act 1998 Section 56(2) amended 27 March 1998 section 2(4) Student Loan Scheme Amendment Act 1998 Section 56(2A) inserted 27 March 1998 section 2(5) Student Loan Scheme Amendment Act 1998 Section 56(2B) inserted 20 May 1999 section 4(1) Student Loan Scheme Amendment Act 1999
57: Election by
overseas based borrower
1: Where any overseas based overseas based
a: credit the amount so paid in excess, so far as it extends, to any repayment obligation for any other tax year
b: notify the borrower of any amount so paid in excess that is not credited under paragraph (a).
2: The borrower may request the Commissioner, within 2 months of the date on which the Commissioner issued the notice, to refund any amount so paid in excess that is not credited under subsection (1)(a).
2A: Unless subsection (4) applies, a refund of an amount paid in excess of a borrower's repayment obligation must be made in the manner required under section 184A
3: Any such request shall be irrevocable.
4: If no such request is made within that time, any amount paid in excess that is not credited under subsection (1)(a) shall be applied in reduction of the loan balance. Section 57 heading amended 1 April 2007 section 28(1) Student Loan Scheme Amendment Act 2007 Section 57(1) amended 1 April 2007 section 28(2) Student Loan Scheme Amendment Act 2007 Section 57(1)(a) amended 1 April 2005 section YA 2 Income Tax Act 2004 Section 57(2A) inserted 7 October 1998 section 6(1) Student Loan Scheme Amendment Act (No 2) 1998
57A: Application of sections 57B to 57D
Sections 57B to 57D
a: apply despite anything to the contrary in this Act; and
b: only apply to a refund that was elected or requested by a borrower under section 56 section 57 Section 57A inserted 22 December 2005 section 11 Student Loan Scheme Amendment Act 2005
57B: No refunds for deductions or payments made prior to
31 March 2006 No refund may be made under section 56 section 57 31 March 2006 Section 57B inserted 22 December 2005 section 11 Student Loan Scheme Amendment Act 2005 Section 57B heading amended 30 August 2011 section 222 Student Loan Scheme Act 2011 Section 57B amended 30 August 2011 section 222 Student Loan Scheme Act 2011
57C: Certain refunds not entitled to full interest write-off under section 38AK
1: This section applies to refunds made under section 56 section 57 section 57D relevant refund
2: The amount of any relevant refund must be excluded from the amount of a borrower's loan balance for the purposes of section 38AK(1)
3: Until such time as the relevant refund and all interest charged on it are repaid in full to the Commissioner,—
a: all payments in respect of the borrower's repayment obligation must be off-set only against the portion of that borrower's loan balance that consists of the relevant refund that remains outstanding and the interest charged on it (the priority portion
b: any amount deducted or paid in excess of the borrower's repayment obligation must be off-set only against the priority portion; and
c: section 50
4: In their application to a borrower who is entitled to a full interest write-off under section 38AA sections 38C 39 40 IRD loan balance loan balance Section 57C inserted 22 December 2005 section 11 Student Loan Scheme Amendment Act 2005
57D: Commissioner's discretion in cases of significant financial hardship
1: On the application of a borrower, the Commissioner may exempt part or all of a relevant refund made to that borrower from section 57C
2: The Commissioner may only exempt a relevant refund if the Commissioner is satisfied that that refund was necessary to alleviate the borrower's significant financial hardship.
3: If the Commissioner grants an exemption under subsection (1), the Commissioner must specify the amount of the relevant refund that is exempt from section 57C
4: In this section, significant financial hardship
a: a borrower's inability to meet minimum living expenses; or
b: a borrower's inability to carry out his or her usual occupation because of his or her temporary or permanent illness, injury, or disability; or
c: a borrower's inability to meet mortgage repayments on his or her principal family residence resulting in the mortgagee seeking to enforce the mortgage on the residence; or
d: the cost of modifying a residence to meet special needs arising from a disability of a borrower or a borrower's dependant; or
e: the cost of medical treatment for an illness or injury of a borrower or a borrower's dependant; or
f: the cost of palliative care for a borrower or a borrower's dependant; or
g: the cost of a funeral for a borrower's deceased dependant. Section 57D inserted 22 December 2005 section 11 Student Loan Scheme Amendment Act 2005
58: Repayment obligation paid in excess may be set off against increased repayment obligation when assessments reopened
In any case where, upon the investigation by the Commissioner of the liability of a borrower for that borrower's repayment obligation over a group of 2 or more income years,—
a: the Commissioner assesses the borrower with a repayment obligation for any year of assessment in respect of which no assessment has been made previously or alters an assessment for any year so as to increase the repayment obligation; and
b: the Commissioner is satisfied that for any year or years of assessment within that group of years any repayment obligation has been paid in excess of the amount properly payable,— the Commissioner may, to the extent that in the Commissioner's opinion is equitable, allow any amount so paid in excess to be deducted from or set off against any repayment obligation due and unpaid for any year or years within that group of income years, notwithstanding that the time for the making of a refund of any repayment obligation so paid in excess may have expired. 1976 No 65 s 410
58A: Repayment obligation paid in excess may be refunded when assessments reopened
1: This section applies to any case where, upon investigation by the Commissioner of a borrower's liability for a repayment obligation for any tax year
a: the repayment obligation assessed by the Commissioner was incorrect; and
b: as a result, any repayment obligation has been paid in excess of the amount properly payable by that borrower (a difference in assessment amounts
2: In any case to which this section applies,—
a: the Commissioner must notify the relevant borrower of the amount of the difference in assessment amounts; and
b: the borrower may request the Commissioner, within 6 months of the date on which the Commissioner issued the notice, to refund the whole or part of the portion of the repayment obligation that is the difference in assessment amounts.
3: A refund that is made under this section must be made in the manner required under section 184A
4: If no request for a refund is made by a borrower within the required 6 months, the difference in assessment amounts must be applied in reduction of the relevant borrower's loan balance.
5: This section applies despite anything to the contrary in this Act. Section 58A inserted 22 December 2005 section 12 Student Loan Scheme Amendment Act 2005 Section 58A(1) amended 28 March 2007 section 29 Student Loan Scheme Amendment Act 2007
59: Appropriation of refunds
A refund of repayment obligation or interest that has been paid in excess of the amount required under this Act may be made without further appropriation than this section. Section 59 substituted 15 December 2000 section 9 Student Loan Scheme Amendment Act (No 2) 2000 Miscellaneous provisions
60: Write-off of loan balance
If—
a: a borrower should die; or
b: the Commissioner has reasonable grounds for believing that a borrower has died; or
c: a borrower has an IRD loan balance that, as at the last day of any tax year $20 the IRD loan balance shall be reduced to zero. Section 60(c) amended 1 October 2007 section 30 Student Loan Scheme Amendment Act 2007 Section 60(c) amended 1 April 2005 section YA 2 Income Tax Act 2004
60A: Cancellation of interest if IRD loan balance repaid early
1: Subsection (2) applies if—
a: the Commissioner notifies a borrower of the borrower's outstanding IRD loan balance; and
b: the borrower pays that loan balance in full (including interest charged to the date of notification) within 30
2: The Commissioner must cancel the interest that accrues between the date of a notification and the date on which the payment is received.
3: This section applies to notifications provided on or after 1 June 1998. Section 60A inserted 27 March 1998 section 3 Student Loan Scheme Amendment Act 1998 Section 60A(1)(b) amended 7 March 2010 section 24 Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Act 2010
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: a × b 365 where— a is the amount of the repayment threshold referred to in section 2 b is the number of days in the period. Section 61 substituted 1 April 2007 section 31 Student Loan Scheme Amendment Act 2007
62: Disclosure of information
1: For the purposes of this section, authorised person
a: the Commissioner of Inland Revenue or any officer of the Inland Revenue Department who is authorised by the Commissioner to disclose and receive information under this section; or
b: any employee of the loan manager who is authorised by the chief executive
c: any employee of any tertiary institution who is authorised by the chief executive
1A: For the purposes of section 81(4)(g) authorised person chief executive specified department chief executive
2: No obligation as to secrecy or other restriction imposed by any enactment or otherwise on the disclosure of information may prevent—
a: an authorised person from disclosing to another authorised person any information required for the purpose of enabling the Commissioner to correctly identify a borrower whose loan is to be transferred from the loan manager to the Commissioner for collection; or
ab:
b: the Commissioner from disclosing to the chief executive
i: a student loan may have been improperly obtained; or
ii: an attempt has been made to obtain a student loan by improper means.
2AA:
2A: For the purposes of subsection (2)(b), the information that the Commissioner may disclose includes the following:
a: particulars of any loan repayments made:
b: the current loan balance:
c: such particulars as the Commissioner may possess as to the whereabouts of a borrower:
d: whether a person specified by the chief executive
e: in respect of an address specified by the chief executive
f: any other particulars that the Commissioner considers relevant to the purposes of subsection (2)(b).
3: Subject to subsection (4), information obtained pursuant to subsection (2) shall not be disclosed except to an authorised person and for the purposes of that subsection.
4: No obligation as to secrecy or other restriction imposed by any enactment or otherwise upon the disclosure of information shall prevent the chief executive specified department chief executive
5: For the purposes of section 81(4)(g) chief executive specifed department chief executive
6: In this section, specified department Social Security Act 1964 Section 62(1)(b) amended 19 September 2000 section 9(1)(a) Student Loan Scheme Amendment Act 2000 Section 62(1)(c) amended 19 September 2000 section 9(1)(a) Student Loan Scheme Amendment Act 2000 Section 62(1A) inserted 15 December 2000 section 11(1) Student Loan Scheme Amendment Act (No 2) 2000 Section 62(1A) amended 1 April 2007 section 32(1) Student Loan Scheme Amendment Act 2007 Section 62(2) substituted 26 November 1998 section 2(1) Student Loan Scheme Amendment Act (No 3) 1998 Section 62(2)(ab) repealed 1 April 2007 section 32(2) Student Loan Scheme Amendment Act 2007 Section 62(2)(b) amended 19 September 2000 section 9(1)(a) Student Loan Scheme Amendment Act 2000 Section 62(2AA) repealed 1 April 2007 section 32(3) Student Loan Scheme Amendment Act 2007 Section 62(2A) inserted 26 November 1998 section 2(1) Student Loan Scheme Amendment Act (No 3) 1998 Section 62(2A)(d) amended 19 September 2000 section 9(1)(a) Student Loan Scheme Amendment Act 2000 Section 62(2A)(e) amended 19 September 2000 section 9(1)(a) Student Loan Scheme Amendment Act 2000 Section 62(4) amended 19 September 2000 section 9(1)(a) Student Loan Scheme Amendment Act 2000 Section 62(4) amended 19 September 2000 section 9(1)(b) Student Loan Scheme Amendment Act 2000 Section 62(5) amended 19 September 2000 section 9(1)(a) Student Loan Scheme Amendment Act 2000 Section 62(5) amended 19 September 2000 section 9(1)(b) Student Loan Scheme Amendment Act 2000 Section 62(5) amended 26 November 1998 section 2(2) Student Loan Scheme Amendment Act (No 3) 1998 Section 62(5) amended 1 April 1995 Income Tax Act 1994 Section 62(6) added 19 September 2000 section 9(2) Student Loan Scheme Amendment Act 2000
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) applies despite any obligation as to secrecy or other restriction imposed by any enactment or otherwise on the disclosure of information. Section 62A inserted 28 March 2007 section 33 Student Loan Scheme Amendment Act 2007
62B: Power of Commissioner to access arrival or departure information
In accordance with, and for the purpose set out in, section 280I Section 62B inserted 28 March 2007 section 33 Student Loan Scheme Amendment Act 2007
63: Act to supplement loan contract
The provisions of this Act shall supplement the provisions of the loan contract and shall prevail in the event of any inconsistency.
63A: Loan contract enforceable against minor
A loan contract entered into by a borrower (whether before or after the commencement of this section) who is under 18 years of age must be treated, for the purposes of the Minors' Contracts Act 1969 Section 63A inserted 19 September 2000 section 10(1) Student Loan Scheme Amendment Act 2000
63B: Initial disclosure
The loan manager must provide a borrower with a copy of the borrower's student loan contract before the day that is 6 working days after the day on which the contract is entered into. SR 2010/341 r 5 Section 63B inserted 30 August 2011 section 222 Student Loan Scheme Act 2011
63C: Certain information must be disclosed in loan contract
1: Every loan contract entered into on or after the date on which this section comes into force must specify the following information that applies at the date the loan contract is entered into:
a: the repayment threshold:
b: the total interest rate:
c: the repayment percentage:
d: the amount of any student loan establishment fee:
e: the amount of the annual administration fee charged under section 63L
f: any other matters specified in regulations.
2: The Commissioner must inform borrowers in accordance with section 63D Section 63C inserted 30 August 2011 section 222 Student Loan Scheme Act 2011
63D: Method of informing borrowers
For the purposes of section 63C(2)
a: by—
i: providing the information free of charge on an Internet site that allows the borrower to access the information at all reasonable times; and
ii: making the information available for inspection free of charge, and for purchase at a reasonable price, at each office of the Inland Revenue Department during the period from 8 am to 4.30 pm each working day; or
b: by giving public notice. Section 63D inserted 30 August 2011 section 222 Student Loan Scheme Act 2011
63E: Continuing disclosure of information
1: The loan manager or the Commissioner must disclose the information set out in section 63F
2: The information must—
a: be disclosed at least once in each 6-month period following the day on which the contract is entered into; and
b: relate to the previous 6-month period. SR 2010/341 r 6 Section 63E inserted 30 August 2011 section 222 Student Loan Scheme Act 2011
63F: Content of information disclosed
Each disclosure of information in accordance with section 63E
a: the opening and closing dates of the period covered by the disclosure; and
b: the loan balance on the opening and closing dates; and
c: the date and amount, and a description, of each amount advanced to the borrower under the contract during the period covered by the disclosure; and
d: the date and amount of any interest charged to the borrower during the period covered by the disclosure; and
e: the total interest rate that applies during the period covered by the disclosure; and
f: the date and amount, and a description, of each fee charged to the borrower during the period covered by the disclosure; and
g: the date and amount, and a description, of each penalty charged to the borrower during the period covered by the disclosure. SR 2010/341 r 7 Section 63F inserted 30 August 2011 section 222 Student Loan Scheme Act 2011
63G: Disclosure of changes to obligations under student loan contract
1: Subsection (2) applies if—
a: a change is made to a borrower's obligations under a student loan contract; and
b: that change increases the borrower's obligations under that contract in a more than minor way, including a change to—
i: the borrower's repayment obligations; or
ii: the repayment percentage; or
iii: the total interest rate; and
c: that change is made—
i: without the borrower's prior agreement; or
ii: by, or as a consequence of, an enactment.
2: Details of the change must be disclosed to the borrower within 7 months after the day on which the change is made. SR 2010/341 r 8 Section 63G inserted 30 August 2011 section 222 Student Loan Scheme Act 2011
63H: Direct disclosure of information and changes
1: Disclosure under sections 63E to 63G
a: by means of information that is printed, typewritten, or otherwise visibly represented, copied, or reproduced on paper and is given by personal delivery, post, or fax; or
b: by an electronic means (except a fax), if the person making the disclosure complies with the Electronic Transactions Act 2002
2: Despite subsection (1)(b) of this section and section 16
3: However, subsection (1) does not apply if the loan manager or the Commissioner, as applicable, cannot reasonably locate the borrower. SR 2010/341 r 9 Section 63H inserted 30 August 2011 section 222 Student Loan Scheme Act 2011
63I: Public disclosure of changes
Disclosure under section 63G
a: by providing the information free of charge on an Internet site that allows a borrower to access the information at all reasonable times; and
b: by giving public notice that the information is available on that Internet site. SR 2010/341 r 10 Section 63I inserted 30 August 2011 section 222 Student Loan Scheme Act 2011
63J: Satisfaction of requirements to disclose
If disclosure is made in accordance with sections 63E to 63H SR 2010/341 r 11 Section 63J inserted 30 August 2011 section 222 Student Loan Scheme Act 2011
63K: Cap on student loan establishment fees
A student loan establishment fee charged by the loan manager to a borrower under a student loan contract must not exceed $60. SR 2010/341 r 12 Section 63K inserted 30 August 2011 section 222 Student Loan Scheme Act 2011
63L: Annual administration fee
1: If a borrower has a loan balance of $20 or more on the close of 31 March 2012,—
a: an annual administration fee of $40 must be charged by the Commissioner to that borrower for the 1 April 2011 to 31 March 2012 tax year; and
b: that borrower's loan balance is increased on 1 April 2012 by the amount of that fee.
2: However, no fee may be charged under subsection (1) to a borrower if that borrower is charged with a student loan establishment fee during the period starting on 1 April 2011 and ending on 31 March 2012. Section 63L inserted 30 August 2011 section 222 Student Loan Scheme Act 2011
63M: Student loan contracts are not credit contracts
1: A loan contract is not—
a: a credit contract for the purposes of the Credit Contracts Act 1981
b: a credit contract or a consumer credit contract for the purposes of the Credit Contracts and Consumer Finance Act 2003
2: No cause of action exists under the Credit Contracts Act 1981 or the Credit Contracts and Consumer Finance Act 2003
3: This section applies—
a: to all loan contracts regardless of when they were entered into; and
b: despite anything to the contrary. Section 63M inserted 30 August 2011 section 222 Student Loan Scheme Act 2011
63N: Commissioner may exercise rights in loan contracts to recall loans
1: The Commissioner may exercise any right or power in a loan contract to recall or demand repayment of all or any part of a loan balance.
2: To avoid doubt, the right or power may be exercised in the name of the Commissioner without any assignment by the lender.
3: This section applies—
a: whether or not the Commissioner is the lender under the loan contract or a person on whom the loan contract confers the right or power; and
b: despite section 63
c: whether the loan contract was signed before or after the date on which this section comes into force. Section 63N inserted 30 August 2011 section 222 Student Loan Scheme Act 2011
5: Challenges after transfer of loan balance to Commissioner
Part 5 heading substituted 1 October 1996 section 9(1) Student Loan Scheme Amendment Act 1996
64: Challenge to assessment of repayment obligation
Any borrower whose repayment obligation has been assessed under Part 2 Part 3 challenge Section 64 heading amended 1 October 1996 section 10 Student Loan Scheme Amendment Act 1996 Section 64 amended 1 October 1996 section 10(1) Student Loan Scheme Amendment Act 1996
65: Challenge to amount of interest charged
Any borrower who is charged with interest in a tax year challenge section 43 Section 65 heading amended 1 October 1996 section 11 Student Loan Scheme Amendment Act 1996 Section 65 amended 1 April 2005 section YA 2 Income Tax Act 2004 Section 65 amended 1 October 1996 section 11(1) Student Loan Scheme Amendment Act 1996
65A: Objection to decision concerning grant of exemption
A borrower may challenge a decision by the Commissioner—
a: not to grant that borrower an exemption to the 183-day requirement under section 38AE(1) , 38AJ 38AJA
b: that the conditions in section 38AEA 38AF 38AG 38AH 38AI 38AIA 38AJ(2) 38AJA(4)
c: specifying the start and end dates for the period for which that borrower is treated as being personally present in New Zealand under section 38AE(2)(a) , 38AJ(3)(a) 38AJA(5)(a)
i: not fair and reasonable; or
ii: erroneous:
d: specifying the conditions that must apply or be met in order for that borrower to be treated as being personally present in New Zealand under section 38AE(2)(b) , 38AJ(3)(b) 38AJA(5)(b)
i: not fair and reasonable; or
ii: erroneous:
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. Section 65A inserted 22 December 2005 section 13 Student Loan Scheme Amendment Act 2005 Section 65A(a) amended 7 March 2010 section 25(1) Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Act 2010 Section 65A(b) amended 7 March 2010 section 25(2) Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Act 2010 Section 65A(c) amended 7 March 2010 section 25(3) Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Act 2010 Section 65A(d) amended 7 March 2010 section 25(4) Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Act 2010 Section 65A(e) added 28 March 2007 section 34 Student Loan Scheme Amendment Act 2007 Section 65A(f) added 28 March 2007 section 34 Student Loan Scheme Amendment Act 2007
66: Challenge to penalty
Any person who is charged with a penalty may,—
a: on the ground that the person is not chargeable with the amount of the penalty; or
b: on the ground that the amount of the penalty charged is excessive,— challenge section 45 Section 66 heading amended 1 October 1996 section 12 Student Loan Scheme Amendment Act 1996 Section 66 amended 1 October 1996 section 12(1) Student Loan Scheme Amendment Act 1996
66A: Objection to decisions concerning penalty amnesty
Section 66A repealed 1 April 2007 section 35 Student Loan Scheme Amendment Act 2007
66B: Objection to decision concerning significant financial hardship
A borrower may challenge a decision by the Commissioner under section 57D section 57C Section 66B inserted 22 December 2005 section 14 Student Loan Scheme Amendment Act 2005
67: Challenge to assessment of repayment deduction
Any employer or PAYE intermediary section 22 challenge Section 67 heading amended 1 October 1996 section 13 Student Loan Scheme Amendment Act 1996 Section 67 amended 26 March 2003 section 10(1) Student Loan Scheme Amendment Act 2003 Section 67 amended 1 October 1996 section 13(1) Student Loan Scheme Amendment Act 1996
68: Challenge to penal repayment obligation
1: Any borrower who is assessed under section 85
a: on the ground the borrower is not chargeable with the amounts so assessed; or
b: on the ground that the amount so assessed is excessive having regard to either or both of—
i: the nature and degree of the act or default in respect of which the assessment was made; or
ii: the reason for the imposition of the penal repayment obligation,— challenge the assessment.
2: A challenge may be made under subsection (1) notwithstanding that the amount of the assessment is not in excess of treble the amount of the deficient repayment obligation. Section 68 substituted 1 October 1996 section 14(1) Student Loan Scheme Amendment Act 1996
69: Objector
A challenge under any of sections 64 to 68 Section 69 substituted 22 December 2005 section 15 Student Loan Scheme Amendment Act 2005
69A: Application of Parts 4A and 8A of Tax Administration Act 1994
1: Parts 4A 8A
2: Subsection (1) does not apply to any notice of reassessment issued by the Commissioner under this Act on or after 1 October 1996, if, before that date, the person who has been assessed has made a competent objection to a notice of assessment that precedes the notice of reassessment. Section 69A inserted 1 October 1996 section 16(1) Student Loan Scheme Amendment Act 1996
69B: No right of challenge to interest payable under loan contract
Nothing in—
a: Parts 4A 8A
b: this Act— confers a right to challenge the rate of interest charged under a loan contract. Section 69B inserted 1 October 1996 section 16(1) Student Loan Scheme Amendment Act 1996
70: Manner in which objection to be made
Section 70 repealed 1 October 1996 section 17(1) Student Loan Scheme Amendment Act 1996
71: Time for objection
Section 71 repealed 1 October 1996 section 17(1) Student Loan Scheme Amendment Act 1996
72: Objection to amended assessment or notice
Section 72 repealed 1 October 1996 section 17(1) Student Loan Scheme Amendment Act 1996
73: Extension of time for objection
Section 73 repealed 1 October 1996 section 17(1) Student Loan Scheme Amendment Act 1996
74: Commissioner to consider objections
Section 74 repealed 1 October 1996 section 17(1) Student Loan Scheme Amendment Act 1996
75: Objector may refer disallowed objections to Taxation Review Authority
Section 75 repealed 1 October 1996 section 17(1) Student Loan Scheme Amendment Act 1996
76: Objections to which this Part does not apply
Section 76 repealed 1 October 1996 section 17(1) Student Loan Scheme Amendment Act 1996
6: Offences and penalties
77: Offences in respect of repayment deductions
1: Subject to subsection (3), every borrower commits
a:
b:
c:
d: wilfully fails to notify an employer in accordance with section 18 or a PAYE intermediary
e: negligently fails to notify an employer in accordance with section 18 or a PAYE intermediary
2:
3: Section 77(1) amended 26 July 1996 section 18(1)(a) Student Loan Scheme Amendment Act 1996 Section 77(1)(a) repealed 26 July 1996 section 18(1)(b) Student Loan Scheme Amendment Act 1996 Section 77(1)(b) repealed 26 July 1996 section 18(1)(b) Student Loan Scheme Amendment Act 1996 Section 77(1)(c) repealed 26 July 1996 section 18(1)(b) Student Loan Scheme Amendment Act 1996 Section 77(1)(d) amended 26 March 2003 section 11(1) Student Loan Scheme Amendment Act 2003 Section 77(1)(d) amended 26 July 1996 section 18(1)(c) Student Loan Scheme Amendment Act 1996 Section 77(1)(e) amended 26 March 2003 section 11(1) Student Loan Scheme Amendment Act 2003 Section 77(1)(e) amended 26 July 1996 section 18(1)(d) Student Loan Scheme Amendment Act 1996 Section 77(2) repealed 26 July 1996 section 18(2) Student Loan Scheme Amendment Act 1996 Section 77(3) repealed 26 July 1996 section 18(2) Student Loan Scheme Amendment Act 1996
78: Penalties for offences in respect of repayment deductions
1:
2: Every borrower who commits an offence against section 77(1)(d)
a: on the first occasion on which the person is convicted of any such offence or more than 1 such offence, be liable, in respect of that offence or, as the case may be, each of those offences, to a fine not exceeding $15,000:
b: on every occasion, other than the occasion referred to in paragraph (a), on which the person is convicted of any such offence or more than 1 such offence, be liable, in respect of that offence or, as the case may be, each of those offences, to a fine not exceeding $25,000.
3: Every borrower section 77(1)(e)
a: on the first occasion on which the person is convicted of any such offence or more than 1 such offence, be liable, in respect of that offence or, as the case may be, each of those offences, to a fine not exceeding $2,000:
b: on the second occasion on which the person is convicted of any such offence or more than 1 such offence, be liable, in respect of that offence or, as the case may be, each of those offences, to a fine not exceeding $4,000:
c: on every occasion, other than the occasions referred to in paragraphs (a) and (b), on which the person is convicted of any such offence or more than 1 such offence, be liable, in respect of that offence or, as the case may be, each of those offences, to a fine not exceeding $6,000. Section 78(1) repealed 26 July 1996 section 19(1)(a) Student Loan Scheme Amendment Act 1996 Section 78(2) amended 26 July 1996 section 19(1)(b) Student Loan Scheme Amendment Act 1996 Section 78(3) amended 26 July 1996 section 19(1)(c) Student Loan Scheme Amendment Act 1996
79: Other offences
1: Every person commits an offence against this Act who—
a: being a borrower, wilfully
b:
c:
d:
e: aids, abets, incites, or conspires with any borrower
2: Every person who commits an offence against subsection (1) shall,—
a: on the first occasion on which the person is convicted of any such offence or more than 1 such offence, be liable, in respect of that offence or, as the case may be, each of those offences, to a fine not exceeding $15,000:
b: on every occasion, other than the occasion referred to in paragraph (a), on which the person is convicted of any such offence or more than 1 such offence, be liable, in respect of that offence or, as the case may be, each of those offences, to a fine not exceeding $25,000.
3: Every person commits an offence against this Act who—
a: being a borrower,
b: being a borrower,
c: being a borrower,
d:
e:
4: Every person who commits an offence against subsection (3) shall,—
a: on the first occasion on which the person is convicted of any such offence or more than 1 such offence, be liable, in respect of that offence or, as the case may be, each of those offences, to a fine not exceeding $2,000:
b: on the second occasion on which the person is convicted of any such offence or more than 1 such offence, be liable, in respect of that offence or, as the case may be, each of those offences, to a fine not exceeding $4,000:
c: on every occasion, other than the occasions referred to in paragraphs (a) and (b), on which the person is convicted of any such offence or more than 1 such offence, be liable, in respect of that offence or, as the case may be, each of those offences, to a fine not exceeding $6,000. Section 79(1)(a) amended 26 July 1996 section 20(1)(a) Student Loan Scheme Amendment Act 1996 Section 79(1)(b) repealed 26 July 1996 section 20(1)(b) Student Loan Scheme Amendment Act 1996 Section 79(1)(c) repealed 26 July 1996 section 20(1)(b) Student Loan Scheme Amendment Act 1996 Section 79(1)(d) repealed 26 July 1996 section 20(1)(b) Student Loan Scheme Amendment Act 1996 Section 79(1)(e) amended 26 July 1996 section 20(1)(c) Student Loan Scheme Amendment Act 1996 Section 79(3)(a) amended 26 July 1996 section 20(2)(a) Student Loan Scheme Amendment Act 1996 Section 79(3)(b) amended 26 July 1996 section 20(2)(b) Student Loan Scheme Amendment Act 1996 Section 79(3)(b) amended 26 July 1996 section 20(2)(c) Student Loan Scheme Amendment Act 1996 Section 79(3)(c) amended 26 July 1996 section 20(2)(d) Student Loan Scheme Amendment Act 1996 Section 79(3)(d) repealed 26 July 1996 section 20(2)(e) Student Loan Scheme Amendment Act 1996 Section 79(3)(e) repealed 26 July 1996 section 20(2)(e) Student Loan Scheme Amendment Act 1996
80: Officers and employees of corporate bodies
Section 80 repealed 26 July 1996 section 21(1) Student Loan Scheme Amendment Act 1996
81: Offence to prejudice employees because of student loan repayment liability
1: Every employer commits an offence against this Act who—
a: refuses to employ, or to pay salary or wages to, another person; or
b: dismisses, or threatens to dismiss, another person from his or her employment; or
c: terminates, or threatens to terminate, the payment of salary or wages to another person; or
d: prejudices, or threatens to prejudice, another person in his or her employment or otherwise in the receipt of salary or wages; or
e: intimidates or coerces, imposes any pecuniary or other penalty on, or takes any other disciplinary action in relation to, another person,— because the other person has a student loan.
2: In a prosecution for an offence against subsection (1), it is not necessary for the prosecutor to prove the reasons for the defendant's action, but it is a defence to the prosecution if the defendant proves, on the balance of probabilities, that the action was not motivated (either in whole or in part) by a reason specified in that subsection.
3: Every person who commits an offence against subsection (1) shall be liable to a fine not exceeding $2,000.
4: Where an employer is convicted of an offence against subsection (1), the court may order the payment of compensation to the person for loss or damage suffered as a result of the offence. 1991 No 142 s 171
82: Proceedings to be taken summarily
All proceedings for offences under this Act shall be taken by way of summary prosecution before a District Court Judge upon the information of the Commissioner. 1976 No 65 s 417 1991 No 142 s 211
83: Information may charge several offences
1: Any information may charge the defendant with any number of offences against this Act if those offences are founded on the same set of facts, or form or are part of a series of offences of the same or similar character.
2: Where any information charges more than 1 such offence, particulars of each offence charged shall be set out separately in the information.
3: All such charges shall be heard together, unless the court, either before or at any time during the hearing, considers it just that any charge should be heard separately and makes an order to that effect. 1976 No 65 s 418 1991 No 142 s 212
84: Information may be laid within 10 years
Notwithstanding anything in the Summary Proceedings Act 1957 1976 No 65 s 419 1991 No 142 s 213
85: Penal repayment obligation in case of evasion
If any borrower evades, or attempts to evade, or does any act with intent to evade, or makes default in the performance of any duty imposed upon the borrower by this Act or any regulations made under this Act with intent to evade, the assessment or payment of any sum which is or may become chargeable against the borrower by way of a repayment obligation (which sum shall be known as the deficient repayment obligation penal repayment obligation sections 186 to 191 section 193 section 188 1976 No 65 s 420 Section 85 amended 1 April 1995 Income Tax Act 1994
86: Penal charge for default in paying repayment deduction
Section 86 repealed 26 July 1996 section 22(1) Student Loan Scheme Amendment Act 1996
7: Regulations
and miscellaneous matters Part 7 heading: amended 28 March 2007 section 36 Student Loan Scheme Amendment Act 2007
87: Regulations
1: The Governor-General may from time to time, by Order in Council, make regulations, not inconsistent with this Act, for all or any of the following purposes:
a: determining—
i: the amount of the repayment threshold:
ii:
iii:
iv: the repayment percentage,— that shall apply in respect of any tax year
ab:
ac:
b:
ba:
bb: specifying a list of charitable organisations for the purposes of section 38AE(1)(b)
bc: specifying further information requirements in accordance with section 63C(1)(f)
c: prescribing offences in respect of the contravention of or non-compliance with any regulations made under this Act, and the amounts of the fines that may be imposed in respect of any such offences, which fines shall be an amount not exceeding $500:
d: providing for such matters as are contemplated by or necessary for giving full effect to the provisions of this Act and for its due administration.
2:
3:
4: The Commissioner shall notify any borrower affected by any regulation made under subsection (1)(a)
5: Such notification shall be, in accordance with the loan contract, either by notice in writing to the borrower or by advertisement in the public notices section of the major New Zealand metropolitan newspapers. Section 87(1)(a) amended 1 April 2005 section YA 2 Income Tax Act 2004 Section 87(1)(a)(ii) repealed 22 December 2005 section 16(1) Student Loan Scheme Amendment Act 2005 Section 87(1)(a)(iii) repealed 22 December 2005 section 16(1) Student Loan Scheme Amendment Act 2005 Section 87(1)(ab) repealed 1 April 2010 section 26(1) Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Act 2010 Section 87(1)(ac) repealed 1 April 2010 section 26(1) Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Act 2010 Section 87(1)(b) repealed 7 March 2010 section 26(2) Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Act 2010 Section 87(1)(ba) repealed 1 April 2007 section 37(2) Student Loan Scheme Amendment Act 2007 Section 87(1)(bb) inserted 22 December 2005 section 16(3) Student Loan Scheme Amendment Act 2005 Section 87(1)(bc) inserted 30 August 2011 section 222 Student Loan Scheme Act 2011 Section 87(2) repealed 22 December 2005 section 16(4) Student Loan Scheme Amendment Act 2005 Section 87(3) repealed 22 December 2005 section 16(4) Student Loan Scheme Amendment Act 2005 Section 87(4) amended 7 March 2010 section 26(3) Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Act 2010
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
b: a base interest write-off as described in section 39(2) section 17
c: an interest reduction as described in section 40(2) section 17
2: In relation to a borrower to whom this section applies,—
a: the full interest write-off described in subsection (1)(a) is validated and must not be reversed:
b: the base interest write-off described in subsection (1)(b) is validated and must not be reversed:
c: the interest reduction described in subsection (1)(c) is validated and must not be reversed.
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. Section 88 substituted 28 March 2007 section 38 Student Loan Scheme Amendment Act 2007
8: 2007/08 transitional provisions for fresh start for certain borrowers
Part 8 heading added 1 April 2007 section 40 Student Loan Scheme Amendment Act 2007
89: Interpretation
In this Part, unless the context otherwise requires,— amnesty application date section 93(1)(a)(i) amnesty condition sections 94 to 97 100 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 section 10 off-set old amnesty sections 45A to 45D section 21 old repayment obligation section 90 resident repayment obligation Part 2 Student Loan Scheme Amendment Act 2007 Section 89 substituted 1 April 2007 section 40 Student Loan Scheme Amendment Act 2007 Fresh start for certain non-resident borrowers Heading: substituted 1 April 2007 section 40 Student Loan Scheme Amendment Act 2007
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. Section 90 substituted 1 April 2007 section 40 Student Loan Scheme Amendment Act 2007
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. Section 91 substituted 1 April 2007 section 40 Student Loan Scheme Amendment Act 2007 New amnesty Heading: substituted 1 April 2007 section 40 Student Loan Scheme Amendment Act 2007
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 Section 92 substituted 1 April 2007 section 40 Student Loan Scheme Amendment Act 2007
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). Section 93 substituted 1 April 2007 section 40 Student Loan Scheme Amendment Act 2007
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); and
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. Section 94 substituted 1 April 2007 section 40 Student Loan Scheme Amendment Act 2007
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 Section 95 substituted 1 April 2007 section 40 Student Loan Scheme Amendment Act 2007
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 Section 96 substituted 1 April 2007 section 40 Student Loan Scheme Amendment Act 2007
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. Section 97 substituted 1 April 2007 section 40 Student Loan Scheme Amendment Act 2007
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) Section 98 substituted 1 April 2007 section 40 Student Loan Scheme Amendment Act 2007
98A: No repayment deductions to be made from income-tested benefits before 1 April 1994
Section 98A repealed 1 April 2007 section 39(2) Student Loan Scheme Amendment Act 2007
99: Relationship with New Zealand based repayment obligations
An amount paid by a borrower under section 94 Section 99 substituted 1 April 2007 section 40 Student Loan Scheme Amendment Act 2007
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. Section 100 substituted 1 April 2007 section 40 Student Loan Scheme Amendment Act 2007
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 Section 101 substituted 1 April 2007 section 40 Student Loan Scheme Amendment Act 2007
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 Section 102 substituted 1 April 2007 section 40 Student Loan Scheme Amendment Act 2007
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) would have been more than the late payment penalties, the Commissioner may reduce the amount in subsection (1) to such an amount as the Commissioner considers to be fair and reasonable.
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) but reduced in proportion to the degree of the breach. Section 103 added 1 April 2007 section 40 Student Loan Scheme Amendment Act 2007
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 Section 104 added 1 April 2007 section 40 Student Loan Scheme Amendment Act 2007
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 Section 105 added 1 April 2007 section 40 Student Loan Scheme Amendment Act 2007
9: Other transitional provisions
Part 9 added 1 April 2007 section 40 Student Loan Scheme Amendment Act 2007 Repayment holiday entitlements for borrowers who are overseas based on 1 April 2007 Heading added 1 April 2007 section 40 Student Loan Scheme Amendment Act 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 Section 106 added 1 April 2007 section 40 Student Loan Scheme Amendment Act 2007
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 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 Section 107 added 1 April 2007 section 40 Student Loan Scheme Amendment Act 2007
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) has ended; or
b: while opting out of a repayment holiday in accordance with section 33 Section 108 added 1 April 2007 section 40 Student Loan Scheme Amendment Act 2007
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 section 108 sections 31 to 36B
3: However, any repayment holiday that borrower has already had under section 107 section 108
4: The amnesty conditions in Part 8 section 107 Section 109 added 1 April 2007 section 40 Student Loan Scheme Amendment Act 2007
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), a borrower becomes a 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 Section 110 added 1 April 2007 section 40 Student Loan Scheme Amendment Act 2007
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 Section 111 added 1 April 2007 section 40 Student Loan Scheme Amendment Act 2007 Application of Tax Administration Act 1994 Heading: added 1 April 2007 section 40 Student Loan Scheme Amendment Act 2007
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. Section 112 added 1 April 2007 section 40 Student Loan Scheme Amendment Act 2007