94B Liability of wholly-owned group and other bodies to pay shortfall penalties

(1)

If the Commissioner treats the companies in a wholly-owned group as if they were a single taxpayer for the purpose of determining a tax shortfall,—

(a)

the Commissioner may assess one company in the group for the shortfall penalty; but

(b)

all the other companies remain liable to pay the shortfall penalty until it is paid in full.

(2)

All the partners in a partnership, and all the persons in any other group of persons that derive or incur amounts jointly or that are assessed together, are liable individually and collectively for a shortfall penalty imposed by the Commissioner—

(a)

in respect of a tax position taken; or

(b)

as a consequence of how or the way in which a tax position is taken—

by the partnership or the other group of persons, as the case may be.

(3)

For the purposes of subsection (2),—

(a)

where a shortfall penalty is imposed in respect of a partnership, the part of that penalty imposed on each partner shall be in proportion to the partner’s share or interest in the partnership; and

(b)

where a shortfall penalty is imposed in respect of a group of persons (other than a partnership), that penalty shall be imposed in such proportions as the Commissioner determines on any 1 or more of the persons in that group.

Section 94B: inserted, on 26 July 1996, by section 17 of the Tax Administration Amendment Act (No 2) 1996 (1996 No 56).

Section 94B(2): amended, on 26 July 1996 (applying to 1997–98 and subsequent income years), by section 454 of the Taxation (Core Provisions) Act 1996 (1996 No 67).