Income Tax Act 2004

Part G
Avoidance and non-market transactions

Contents

Subpart GBAvoidance: general

GB 1 Agreements purporting to alter incidence of tax to be void

Subpart GCAvoidance: specific

GC 1 Arrangement to defeat application of cross-border arrangement provision

GC 2 Arrangements to defeat application of net loss carry forward provisions

GC 3 Effect on continuity provisions of change in beneficiaries of trust

GC 4 Arrangement to defeat application of net loss offset provisions

GC 5 Arrangement to defeat application of qualifying company provisions

GC 6 Arrangement to defeat application of depreciation provisions

GC 7 Arrangements in respect of CFCs

GC 8 Arrangement to defeat application of CFC attributed repatriation provisions

GC 9 Variations in control or income interests in foreign companies

GC 10 Attributed CFC income and FIF income: arrangements in respect of elections

GC 11A Non-market transactions to acquire film rights

GC 11B Manipulation of arrangements to acquire film rights

GC 12 Petroleum mining

GC 14 Income of beneficiaries

GC 14A Sale or transfer of commercial bill to New Zealand resident

GC 14B Attribution rule for personal services

GC 14C Definitions for use in section GC 14B

GC 14D Attribution rule: calculation

GC 14E Attribution rule: exception

GC 14EB Treatment of dividends as if from qualifying company [Repealed]

GC 14F Arrangement to avoid application of restrictive covenant rule

GC 14G Arrangement to avoid application of rules for returning share transfers

Fringe benefit tax

GC 15 Benefit given to associated person of employee

GC 16 Value of motor vehicle acquired from associated person

GC 17 Fringe benefit tax: general

GC 17B Fringe benefit tax: arrangement void

Deductions

GC 18 Agreements not to make tax deductions to be void

GC 19 Resident withholding tax

GC 20 Agreements not to make resident withholding tax deductions to be void

Imputation

GC 21 Imputation continuity requirements

GC 22 Imputation: arrangement to obtain tax advantage

GC 23 Imputation: dividend paid by another company

GC 24 Application of specific imputation provisions to consolidated groups

GC 25 Avoidance of dividend withholding payments

GC 26 Arrangement to defeat application of branch equivalent tax account provisions

GC 27 Arrangement to defeat application of dividend withholding payment account provisions

GC 27A Arrangement to obtain tax advantage with respect to Maori authority credit account provisions (subpart MK)

Tax credits for families

GC 28 Tax credits for families

Arrangements involving money not at risk

GC 29 Application of sections GC 29 to GC 31

GC 30 Defined terms for sections GC 29 to GC 31

GC 31 Deferral of surplus deductions from arrangement

Subpart GDNon-market transactions

Trading stock

GD 1 Sale or other disposal of trading stock for inadequate consideration

GD 2 Distribution of trading stock to shareholders of company [Repealed]

Remuneration

GD 3 Payment of excessive salary or wages, or allocation of excessive share of profits or losses, to relative employed by or in partnership with taxpayer

GD 4 Payments to taxpayer's spouse, civil union partner or de facto partner

GD 5 Excessive remuneration by close company to shareholder, director, or relative

Superannuation and life insurance

GD 6 Value of loans provided by superannuation fund deemed to be income of fund

GD 7 Distribution of property to policyholders

GD 8 Superannuation schemes

Leases

GD 10 Leases for inadequate rent

Other non-market transactions

GD 11 Financial arrangements rules

GD 12 Non-market transactions for incurring film production expenditure

GD 12A Film production expenditure if payments postponed or contingent

GD 12B Manipulation of arrangements to incur film production expenditure

GD 13 Cross-border arrangements between associated persons

GD 14 Attributing interests in FIFs

GD 15 Disposal of timber, or right to take timber, or standing timber to associated person

GD 16 Disposals of ETS units at below market value

Subpart GENon-market transactions: specific

GE 1 New Zealand Raspberry Marketing Council

Subpart GZTerminating provisions

GZ 1 Pre-1974 agreements purporting to alter incidence of tax

GB 1 Agreements purporting to alter incidence of tax to be void
  • (1) Where an arrangement is void in accordance with section BG 1, the amounts of assessable income, deductions, and available net losses included in calculating the taxable income of any person affected by that arrangement may be adjusted by the Commissioner in the manner the Commissioner thinks appropriate, so as to counteract any tax advantage obtained by that person from or under that arrangement, and, without limiting the generality of this subsection, the Commissioner may have regard to—

    • (a) such amounts of assessable income, deductions, and available net losses as, in the Commissioner's opinion, that person would have, or might be expected to have, or would in all likelihood have, had if that arrangement had not been made or entered into; or

    • (b) such amounts of assessable income and deductions as, in the Commissioner's opinion, that person would have had if that person had been allowed the benefit of all amounts of assessable income, or of such part of the assessable income, as the Commissioner considers proper, derived by any other person or persons as a result of that arrangement.

    (2) Where any amount of assessable income or deduction is included in the calculation of taxable income of any person under subsection (1), then, for the purposes of this Act, that amount is not included in the calculation of the taxable income of any other person.

    (2A) Without limiting the generality of the preceding subsections, if an arrangement is void in accordance with section BG 1 because, whether wholly or partially, the arrangement directly or indirectly relieves a person from liability to pay income tax by claiming a credit of tax, the Commissioner may, in addition to any other action taken under this section,—

    • (a) disallow the credit in whole or in part; and

    • (b) allow in whole or in part the benefit of the credit of tax for any other taxpayer.

    (2B) For the purposes of subsection (2A), the Commissioner may have regard to the credits of tax which the taxpayer or another taxpayer would have had, or might have been expected to have had, if the arrangement had not been made or entered into.

    (2C) In this section, credit of tax means the reduction or offsetting of the amount of tax a person must pay because—

    • (a) credit has been allowed for a payment of any kind, whether of tax or otherwise, made by a person; or

    • (b) of a credit, benefit, entitlement, or state of affairs.

    (3) Without limiting the generality of subsections (1) and (2), section BG 1, or the definitions of arrangement, liability, tax avoidance, or tax avoidance arrangement in section OB 1, where, in any tax year, any person sells or otherwise disposes of any shares in any company under a tax avoidance arrangement under which that person receives, or is credited with, or there is dealt with on that person's behalf, any consideration (whether in money or money's worth) for that sale or other disposal, being consideration the whole or a part of which, in the opinion of the Commissioner, represents, or is equivalent to, or is in substitution for, any amount which, if that arrangement had not been made or entered into, that person would have derived or would derive, or might be expected to have derived or to derive, or in all likelihood would have derived or would derive, as dividends in that tax year, or in any subsequent tax year or years, whether in 1 sum in any of those years or in any other way, an amount equal to the value of that consideration, or of that part of that consideration, is deemed to be a dividend derived by that person in that first-mentioned tax year.

    Compare: 1994 No 164 s GB 1