Description: This Interpretation Statement considers the deductibility of certain expenditure relating to the administration of a company ('company administration costs')

Description: Section EX 21B(3) of the Income Tax Act 2007 provides that a CFC that is an insurer meeting the requirements of a determination made by the Commissioner under section 91AAQ of the Tax Administration Act 1994 is a non-attributing active CFC. In the absence of such a determination, a CFC carrying on an insurance business is unlikely to be a non-attributing active CFC, because insurance income is otherwise treated as passive income and an attributable CFC amount by section EX 20B(3) of the Income Tax Act 2007.

Description: Section EX 21B(3) of the Income Tax Act 2007 provides that a CFC that is an insurer meeting the requirements of a determination made by the Commissioner under section 91AAQ of the Tax Administration Act 1994 is a non-attributing active CFC. In the absence of such a determination, a CFC carrying on an insurance business is unlikely to be a non-attributing active CFC, because insurance income is otherwise treated as passive income and an attributable CFC amount by section EX 20B(3) of the Income Tax Act 2007.

Description: Section EX 21B(3) of the Income Tax Act 2007 provides that a CFC that is an insurer meeting the requirements of a determination made by the Commissioner under section 91AAQ of the Tax Administration Act 1994 is a non-attributing active CFC. In the absence of such a determination, a CFC carrying on an insurance business is unlikely to be a non-attributing active CFC, because insurance income is otherwise treated as passive income and an attributable CFC amount by section EX 20B(3) of the Income Tax Act 2007.

Description: Section EX 21B(3) of the Income Tax Act 2007 provides that a CFC that is an insurer meeting the requirements of a determination made by the Commissioner under section 91AAQ of the Tax Administration Act 1994 is a non-attributing active CFC. In the absence of such a determination, a CFC carrying on an insurance business is unlikely to be a non-attributing active CFC, because insurance income is otherwise treated as passive income and an attributable CFC amount by section EX 20B(3) of the Income Tax Act 2007.

Description: The Taxation (Annual Rates, Employee Allowances, and Remedial Matters) Bill was introduced into Parliament on 22 November 2013. It received its first reading on 10 December 2013, second reading on 27 May 2014 and the third reading on 19 June 2014 followed by Royal assent on 30 June 2014.

Description: Changes have been made to the taxation of employerprovided accommodation, accommodation payments, and other allowances and payments made by employers to cover employee expenditure.

Description: Changes have been made to five aspects of the thin capitalisation rules to help strengthen the rules and better protect New Zealand's tax base. The most significant change is that the rules will now apply when non-residents who appear to be acting together own 50 percent or more of a company. Non-residents will be treated as acting together if they hold debt in a company in proportion to their equity, have entered into an arrangement setting out how to fund the company with related-party debt, or act on the instructions of another person (such as a private equity manager) in funding the company with related-party debt.

Description: Several amendments have been made to the Income Tax Act 2007 relating to business expenditure for which taxpayers were previously allowed neither an immediate tax deduction, nor depreciation over time. Such expenditure is commonly referred to as 'black hole' expenditure. The two broad areas of black hole expenditure addressed are: expenditure towards applying for resource consents, patents and plant variety rights, and various company administration costs. The changes were part of changes announced in Budget 2013.

Description: New Zealand has entered into an intergovernmental agreement (IGA) with the United States to clarify the reporting obligations of New Zealand financial institutions under the United States law commonly known as the Foreign Account Tax Compliance Act (FATCA).

Description: The new rules clarify when a deregistered entity should start its life as a taxpaying entity, how the entity should treat its assets and liabilities when it becomes a tax-paying entity, and what tax provisions should apply to the entity in the future. The rules also clarify the tax consequences for donors that have made donations to these entities.

Description: Amendments have been made to the Income Tax Act 2007 and the Tax Administration Act 1994 to confer tax-exempt status and donee organisation status on certain community housing providers that meet specified criteria (referred to as 'community housing entities'). The amendments clarify the tax status of certain community housing entities that provide pathways to home-ownership for low-income households that cannot afford to buy a home on their own

Description: Amendments have been made to achieve a more coherent and consistent tax treatment of land-related lease payments. The reforms address specific revenue risks with lease transfer payments (that is, received by an exiting tenant for transferring a lease to an incoming tenant). Certain lease transfer payments, which are substitutable for taxable lease surrender and lease premiums payments, are taxable from 1 April 2015.

Description: Amendments have been made to achieve a more coherent and consistent tax treatment of land-related lease payments. The reforms address specific revenue risks with lease transfer payments (that is, received by an exiting tenant for transferring a lease to an incoming tenant). Certain lease transfer payments, which are substitutable for taxable lease surrender and lease premiums payments, are taxable from 1 April 2015.

Description: Amendments exclude perpetually renewable leases from the charging provisions for land-related lease payments in sections CC 1B and CC 1C, as well as the related deduction provisions. An amendment also excludes perpetually renewable leases from being depreciable property.

Description: This amendment excludes a payment for a permanent easement (for example, a permanent right of way) from being taxable to a landowner under section CC 1.

Description: This amendment excludes a payment for a permanent easement (for example, a permanent right of way) from being taxable to a landowner under section CC 1.

Description: The amendment ensures that all occupation right agreements under the Retirement Villages Act 2003 are excluded from the financial arrangement rules.

Description: The tax rules for the valuation of property or services included in agreements for the sale and purchase of property or services (ASAPs) in foreign currency (foreign currency ASAPs as defined) have been changed.

Description: New section CB 15B clarifies the acquisition date of land for the purposes of the land disposal provisions in the Income Tax Act 2007, in particular section CB 6, which has caused considerable uncertainty for taxpayers, their agents and Inland Revenue

Description: The annual income tax rates for the 2014-15 tax year are the rates set out in schedule 1 of the Income Tax Act 2007 and are the same that applied for the 2013-14 tax year.

Description: The substituting debenture rule previously contained in section FA 2(5) of the Income Tax Act 2007 has been repealed as it is now outdated. There are also a number of consequential amendments as a result of the repeal of the rule.

Description: The resident withholding tax (RWT) and the non-resident withholding tax (NRWT) rules in the Income Tax Act 2007 have been amended to deal with technical problems relating to the application of withholding tax rules to inflation-indexed instruments. The amendments relate to the timing and the amount of withholding tax to be deducted from the inflation-indexed component of such instruments.

Description: The Income Tax Act 2007 has been amended to remove from the ambit of the petroleum mining tax rules underground facilities that are used to store processed gas. Transitional provisions have been included to clarify the treatment of any sale proceeds from a sale of an underground gas storage facility that is currently treated as being subject to the petroleum rules and to grandparent an existing permit.

Description: New Zealand-based charities who apply some or all of their funds for overseas purposes and who want donors to receive tax benefits in connection with any donations received, are required to be named as a donee organisation on the list of recipient of charitable or other public benefit gifts in the Income Tax Act 2007.

Description: A definition of 'real property' in section YA 1 has been enacted to clarify that mining permits issued under the Crown Minerals Act 1991 are 'real property' for the purposes of the Income Tax Act 2007 and New Zealand's double tax agreements (DTAs).

Description: Section CW 57 contains a temporary exemption for nonresident offshore oil rig and seismic vessel operators. This exemption was due to expire on 1 January 2015, but has been extended to 31 December 2019. The scope of the exemption has been modified slightly to cater for two particular types of operator. These modifications will apply from 1 January 2015.

Description: As a result of the Government implementing changes to the way foreign charter vessels are regulated in New Zealand waters, foreign charter vessels will be required to reflag to New Zealand by May 2016.

Description: Section CW 46 of the Income Tax Act 2007 has been amended to ensure that trusts can take advantage of the amateur sports promoters exemption

Description: The new Act introduces a number of Goods and Services Tax (GST) amendments to clarify and reinforce existing GST policy, and reduce compliance costs. All section references refer to the Goods and Services Tax Act 1985 unless otherwise stated.

Description: Two amendments have been made to the dwelling and commercial dwelling definitions to clarify that residential units in retirement villages and rest homes where the occupants are essentially living independently are treated as GST-exempt 'dwellings'. Transitional rules have also been introduced in section 21HB for retirement villages and rest homes that have treated residential units as taxable commercial dwellings.

Description: The amendment to the GST definition of 'resident' turns off the retrospective application of the day test rules for determining the tax residency status of individuals. For GST purposes, the day test rules now apply on a prospective basis.

Description: Two amendments have been made to section 6 that relate to the GST treatment of fees paid to directors and board members

Description: An amendment to section 11(8D) has been made to clarify that assignments and surrenders of interests in land are subject to the zero-rating of land rules

Description: An amendment to section 11(8D) has been made to clarify that assignments and surrenders of interests in land are subject to the zero-rating of land rules

Description: New subsection 11A(1)(maa) ensures services carried out on tools are zero-rated when the tools are used in New Zealand solely to manufacture goods that will be exported.

Description: Section 11A(1)(k) allows services supplied to non-residents that are outside New Zealand at the time the services are being performed to be zero-rated. New section 11A(3B) has been introduced to allow 'outside New Zealand' to be interpreted, for a natural person (individual), as a presence in New Zealand that is minor and not directly in connection with the supply.

Description: An amendment to section 20(3K) clarifies that non-profit bodies can claim all of their GST input tax deductions other than those that relate to the making of exempt supplies.

Description: New sections 20(3LB) and (3LC) limit the ability of GST registered non-residents to claim input tax deductions that relate to GST levied by the New Zealand Customs Service.

Description: An amendment has been made to section 20(4B) to ensure that it does not prevent a person from claiming an input tax deduction in cases when they are already registered for GST.

Description: New section 21FB requires taxpayers who have applied the apportionment rules to perform a 'wash-up' calculation when their use of an asset changes to 100 percent taxable or 100 percent non-taxable use.

Description: An amendment to the transitional rule in section 21HB ensures that input tax deductions cannot be claimed in relation to a dwelling reclassified as a commercial dwelling if it was acquired before 1 October 1986.

Description: The amendment to section 21HB allows suppliers affected by the changes to the definitions of 'commercial dwelling' and 'dwelling' to have the option of either including or not including a commercial dwelling as part of their broader taxable activity.

Description: The definition of 'hire purchase agreement' has been broadened to include any contract where a person has an option to purchase.

Description: A cross-reference to the Accident Insurance Act 1998 has been updated to the Accident Compensation Act 2001 in the definition of 'life insurance contract' in section 3. The amendment applies from 1 April 2002. The wording of section 11(8D)(b)(ii) has been amended to ensure commercial lease arrangements are standard rated unless an irregular and large payment is made. The amendment applies from 1 April 2011.

Description: Under the new rules Australian Unit Trusts that are not taxed as companies under Australian law are excluded from the exemptions for Australian controlled foreign companies (CFCs) (section EX 22) and interests in foreign investment funds (FIFs) resident in Australia (section EX 35). This change removes an inconsistency in the previous rules and ensures that the taxation of Australian Unit Trusts is consistent across both countries.

Description: Section DB 55 of the Income Tax Act 2007 has been repealed. This section allowed companies to claim deductions for expenses incurred in deriving exempt foreign dividends. This provision was introduced as exempt foreign dividends were subject to the foreign dividend payment (FDP) rules which were seen as being equivalent to a tax.

Description: The rules that apply to indirectly held interests in FIFs have been clarified. Additional FIF income is calculated only if the CFC or FIF holds an interest in a FIF that would be an attributable interest if the person had directly held their indirect interest.

Description: Under the previous rules, taxpayers determining whether a CFC met the active business test had the option of grouping multiple CFCs together into a test group and working out the ratio of active to passive income based on the consolidated accounts of that group.

Description: A negative numerator in the formula defined in section EX 21E(5) no longer disqualifies a CFC from passing the active business test. Instead the negative numerator is deemed to be zero. The change removes an unnecessary compliance burden.

Description: Taxpayers now have the option to include foreign exchange gains and losses on both financial assets and liabilities when applying the accounting standards test (section EX 21E). Under the accounting standards test, the ratio of passive income to active income takes into account foreign exchange gains and losses from financial assets and not from financial liabilities

Description: The provisions relating to apportioned funding income have been moved from section EX 20C (Net attributable CFC income or loss) to section EX 20B (Attributable CFC income).

Description: Taxpayers can now form test groups for the active business test that include CFCs with offshore branches. The CFC must be able to pass the active business test in its own right and any active income attributed to the offshore branch is excluded from the test group active business test calculation.

Description: The CFC rules have been amended so that the on-lending concession and exemptions that apply to certain interest payments also apply to those dividends that are taxed like interest payments. The measure is intended to align the treatment of dividends from deductible and fixed-rate shares with the treatment of interest

Description: Section CD 40 of the Income Tax Act 2007 and section CD 29 of the Income Tax Act 2004 provide that, if a company recovers a dividend from its shareholders, section 113B of the Tax Administration Act requires the Commissioner to amend the following...

Description: Section EG 1 provides that New Zealand-resident taxpayers may elect to include foreign-sourced income (apart from interest, dividends and foreign investment fund income) in the tax year in which the taxpayer's balance date in the overseas jurisdiction falls.

Description: Section EG 1 provides that New Zealand-resident taxpayers may elect to include foreign-sourced income (apart from interest, dividends and foreign investment fund income) in the tax year in which the taxpayer's balance date in the overseas jurisdiction falls.

Description: Section EX 51 of the Income Tax Act 2007 and section EX 44 of the Income Tax Act 2004 provide that expenditure incurred for, or on behalf of the person having the foreign investment fund (FIF) interest is included in the meaning of 'cost of a FIF interest' for the purpose of calculating FIF income under the comparative value method.

Description: Section FC 5(3)(b) of the Income Tax Act 2007 provides for the valuation of the cost of land transmitted into an estate if sections CB 9 to CB 11, and CB 14 of the Income Tax Act 2007 apply to the land.

Description: Section FM 5 of the Income Tax Act 2007 provides that the joint and several liability imposed on all members of a consolidated group to satisfy income tax obligations of the consolidated group does not apply to a company that has left the group, in relation to an increase in an income tax obligation of the group made:

Description: Section HA 31(2) provides that a director's notice of revocation should take effect from the later of: the year in which the notice is received by the Commissioner; or the effective year stated in the notice.

Description: Section HC 30(4)(a) of the Income Tax Act 2007 provides that if a settlor of a foreign trust becomes resident in New Zealand, and no election is made for the trust to become a complying trust within 12 months of the settlor becoming resident, the trust continues to be treated as a foreign trust until the end of that 12-month period. After the expiry of that 12-month period, the trust becomes a non-complying trust.

Description: Section IW 1(3) of the Income Tax Act 2007 provides that a group of companies may elect to use a tax loss of one company in the group of companies to satisfy a shortfall penalty assessed against any company within the same group of companies

Description: The following amendments relate to minor maintenance items referred to the Rewrite Advisory Panel as minor maintenance items and retrospectively correct the following:

Description: Technical amendments have been made to section EW 8 of the Income Tax Act 2007 to clarify the application and effect of the financial arrangement rules to short-term agreements following an earlier change made by the Taxation (Livestock Valuation, Assets Expenditure, and Remedial Matters) Act 2013.

Description: Technical amendments have been made to section EW 8 of the Income Tax Act 2007 to clarify the application and effect of the financial arrangement rules to short-term agreements following an earlier change made by the Taxation (Livestock Valuation, Assets Expenditure, and Remedial Matters) Act 2013.

Description: Remedial changes have been made to the mixed-use asset rules in subpart DG and section DZ 21 of the Income Tax Act 2007.

Description: The loss grouping rules have been amended to correct an unintended consequence arising during the rewrite of the Income Tax Acts. The amendments confirm the benefit of past loss grouping is contingent on the group loss company satisfying its liabilities relating to past deductible expenditure (other than under the financial arrangement rules).

Description: Section CG will no longer apply to a bankrupt on discharge from bankruptcy, as it conflicts with the 'fresh start' principles of insolvency law on discharge from bankruptcy. Section CG 2 applies to treat an amount of income equal to the amount of remitted or cancelled debts that were incurred for past deductible expenditure.

Description: Amendments have been made to allow the Commissioner, in appropriate circumstances, to bankrupt taxpayers, who are in serious hardship and to ensure the reasons why the debt arose are not a factor in determining whether the taxpayer is in serious hardship. These amendments ensure that the legislation is consistent with Inland Revenue's operational practice

Description: An amendment to the unacceptable tax position penalty clarifies that the penalty does not apply to shortfalls that arise in respect of GST and withholding-type taxes. That is, the unacceptable tax position penalty only applies to income tax shortfalls

Description: Amendments clarify that a new due date is not set when the Commissioner makes a systems-generated default assessment, and that when a taxpayer files a return following a systems-generated default assessment, a new due date is set for the resulting tax liability

Description: In 2010 the loss attributing qualifying company rules were repealed and the look-through company rules introduced. The promoter penalty legislation still referred to 'loss attributing qualifying companies' when it should have referred to 'look-through companies'.

Description: Amendments have been made to clarify that various payments that are of a capital nature, or are windfall gains, are excluded from the definition of 'family scheme income' in section MB 13 of the Income Tax Act 2007.

Description: Various remedial changes are made to the Child Support Act 1991 to clarify wording, correct errors, make further consequential changes and make small changes to simplify the child support scheme

Description: An amendment to the associated persons rules ensures that a person with a power of appointment or removal of a trustee will not be associated with the trustee under section YB 11 (Trustee and person with power of appointment or removal) if they are subject to the professional code of conduct and disciplinary processes of an approved organisation.

Description: Sections 93(2)(b), 94(2)(b), (c), 95(2)(b), 97(3)(a), 97B(3)(a), 98(2)(a), 98B(3)(a), 99(2)(a), (b), 100(3)(b), 101(2)(a) and 101B(2)(a) are being amended to correct a cross-referencing error within section 94(2)(b) noted in a recent court decision. The other provisions listed are consequentially amended for consistency

Description: Section CB 26 has been amended so that it does not apply in relation to dividends from a listed PIE. By way of background, section CX 55 provides that gains arising from the sale of most Australian and New Zealandlisted shares are excluded income for PIEs and similar entities.

Description: Amendments to sections CW 38 and CW 39 clarify that an amount derived by a trustee for a local authority or a public authority constituted as a trust:

Description: A payment to landowners for permanently protecting native forest with high conservation values on their land can be exempted from income tax if the appropriate Order in Council is made

Description: The deemed rate of return for taxing foreign investment fund (FIF) interests is 7.99% for the 2013-14 income year, up from 6.91% for the previous income year.

Description: During a review of the Public Information Bulletin and Tax Information Bulletin series published before 1996, the answer to Question 11 in a series of GST questions and answers in Public Information Bulletin No 148, p 4 (May 1986) was identified as no longer reflecting the Commissioner's interpretation of the law as it relates to GST and hire firm security bonds.

Description: The Arrangement is the issue by ProCare Health Limited (PHL) PHL of two tranches of new shares to its existing shareholders on 15 October 2012, and the redemption of one of the tranches issued to existing shareholders. A further two tranches of shares may also be issued by PHL, to the ProCare Charitable Foundation (the Trust).

Description: This case concerned an application by the Commissioner of Inland Revenue ('the Commissioner') for discovery of documents supporting the disputant's statement in her Statement of Position ('SOP') explaining how she funded her losses

Description: This was an appeal against the decision of the TRA, delivered on 6 November 2013 (TRA 11/10 [2013] NZTRA 09); and the earlier Threshold Ruling of the TRA, delivered on 11 September 2012 (TRA11/10 [2012] NZTRA 08).

Description: The respondent's Statement of Position ('SOP') was considered invalid and the respondent was therefore unable to challenge the assessments under Part 8A of the Tax Administration Act 1994 ('TAA').

Description: The disputant showed a genuine wish to continue the litigation and the right to a hearing and determination should not be lightly denied. The disputant was granted leave to proceed with the challenge proceeding.

Description: The disputant showed a genuine wish to continue the litigation and the right to a hearing and determination should not be lightly denied. The disputant was granted leave to proceed with the challenge proceeding.

Description: A summary judgment was entered by the Court as there was no arguable defence, and no grounds upon which the Court ought to exercise its residual discretion to decline summary judgment

Description: A summary judgment was entered by the Court as there was no arguable defence, and no grounds upon which the Court ought to exercise its residual discretion to decline summary judgment

Description: An application for leave to appeal the decision of the Court of Appeal (Vinelight Nominees Ltd v Commissioner of Inland Revenue [2013] NZCA 655) was made by the applicants

Description: The Taxation Review Authority ('TRA') confirmed the Commissioner of Inland Revenue's ('the Commissioner') assessments for goods and services tax ('GST') and shortfall penalties. The TRA found the disputant remained the lessor of the equipment and the supplier for the purposes of the Goods and Services Tax Act 1985 ('GST Act').

Description: A judicial review application was brought by the taxpayer, seeking a report (with relevance to the taxpayer) in relation to which the Commissioner of Inland Revenue ('the Commissioner') claimed solicitor/client privilege.