IC 3 Common ownership: group of companies
Meaning

(1)

A group of companies means 2 or more companies, none of which is a multi-rate PIE or a listed PIE, in relation to which a group of persons holds—

(a)

common voting interests that add up to at least 66%; and

(b)

if a market value circumstance exists for a company that is part of a group of companies, common market value interests that add up to at least 66%.

Part of group at time or for period

(2)

A company is treated as part of a group of companies at a particular time or for a particular period if the minimum common interests referred to in subsection (1) exist at the relevant time or are kept for the whole of the relevant period. But it is not necessary that the group of persons holding the interests stays the same for the whole of the relevant period.

Restriction for mixed-ownership enterprises

(2A)

A mixed-ownership enterprise may be included in a group of companies only if, at the particular time or for the particular period, no other company in the group is a mixed-ownership enterprise.

When multi-rate PIEs included in group

(2B)

In relation to 2 or more companies of which 1 is a multi-rate PIE, the companies are treated as a group of companies at a particular time or for a particular period if—

(a)

the PIE owns 100% of the voting interests in the other companies; and

(b)

the other companies in the group are—

(i)

multi-rate PIEs:

(ii)

land investment companies:

(iii)

subsidiary companies that meet the requirements of section HM 7(a) and (d) (Requirements):

(iv)

foreign PIE equivalents.

When listed PIEs included in group

(2C)

In relation to 2 or more companies of which 1 is a listed PIE, the companies are treated as a group of companies at a particular time or for a particular period if the PIE owns 100% of the voting interests in the other companies.

When foreign investment PIEs included in group

(2D)

For the purposes of subsection (2B)(b), a multi-rate PIE that chooses under section HM 71B (Choosing to become foreign investment PIE) to become a foreign investment PIE, must not be part of a group of companies that includes a land investment company.

Measuring common voting interests

(3)

In subsection (1)(a), a person’s common voting interest in the relevant companies at a particular time is the percentage of their voting interests under section YC 2 (Voting interests) in each of the companies at the time.

Measuring common market value interests

(4)

In subsection (1)(b), a person’s common market value interest in the relevant companies at a particular time is the percentage of their market value interests under section YC 3 (Market value interests) in each of the companies at the time.

Common interest percentages

(5)

For the purposes of this section, in measuring a person’s common voting interest or common market value interest in 2 or more companies at a particular time,—

(a)

for percentages that are the same in relation to each company, the person’s percentage interest at the time:

(b)

for percentages that differ as between the companies, the lowest percentage interest in each company at the time.

Defined in this Act: common market value interest, common voting interest, company, foreign investment PIE, foreign PIE equivalent, group of companies, group of persons, listed PIE, land investment company, market value circumstance, market value interest, mixed-ownership enterprise, multi-rate PIE, voting interest

Compare: 2004 No 35 s IG 1(2), (5)

Section IC 3(1): amended, on 29 August 2011, by section 90(1) of the Taxation (Tax Administration and Remedial Matters) Act 2011 (2011 No 63).

Section IC 3(1): amended (with effect on 1 April 2010), on 21 December 2010 (applying for the 2010–11 and later income years), by section 105(1) of the Taxation (GST and Remedial Matters) Act 2010 (2010 No 130).

Section IC 3(2A) heading: inserted, on 30 June 2012, by section 11 of the Public Finance (Mixed Ownership Model) Amendment Act 2012 (2012 No 45).

Section IC 3(2A): inserted, on 30 June 2012, by section 11 of the Public Finance (Mixed Ownership Model) Amendment Act 2012 (2012 No 45).

Section IC 3(2B) heading: substituted, on 1 April 2010 (applying for the 2010–11 and later income years), by section 298(2) of the Taxation (International Taxation, Life Insurance, and Remedial Matters) Act 2009 (2009 No 34).

Section IC 3(2B): substituted, on 1 April 2010 (applying for the 2010–11 and later income years), by section 298(2) of the Taxation (International Taxation, Life Insurance, and Remedial Matters) Act 2009 (2009 No 34).

Section IC 3(2B)(b): substituted, on 29 August 2011, by section 90(2) of the Taxation (Tax Administration and Remedial Matters) Act 2011 (2011 No 63).

Section IC 3(2C) heading: inserted, on 29 August 2011, by section 90(3) of the Taxation (Tax Administration and Remedial Matters) Act 2011 (2011 No 63).

Section IC 3(2C): inserted, on 29 August 2011, by section 90(3) of the Taxation (Tax Administration and Remedial Matters) Act 2011 (2011 No 63).

Section IC 3(2D) heading: inserted, on 29 August 2011, by section 90(4) of the Taxation (Tax Administration and Remedial Matters) Act 2011 (2011 No 63).

Section IC 3(2D): inserted, on 29 August 2011, by section 90(4) of the Taxation (Tax Administration and Remedial Matters) Act 2011 (2011 No 63).

Section IC 3(3) heading: substituted (with effect on 1 April 2008), on 7 September 2010 (applying for the 2008–09 and later income years), by section 82(1) of the Taxation (Annual Rates, Trans-Tasman Savings Portability, KiwiSaver, and Remedial Matters) Act 2010 (2010 No 109).

Section IC 3(3): substituted (with effect on 1 April 2008), on 7 September 2010 (applying for the 2008–09 and later income years), by section 82(1) of the Taxation (Annual Rates, Trans-Tasman Savings Portability, KiwiSaver, and Remedial Matters) Act 2010 (2010 No 109).

Section IC 3(4) heading: substituted (with effect on 1 April 2008), on 7 September 2010 (applying for the 2008–09 and later income years), by section 82(1) of the Taxation (Annual Rates, Trans-Tasman Savings Portability, KiwiSaver, and Remedial Matters) Act 2010 (2010 No 109).

Section IC 3(4): substituted (with effect on 1 April 2008), on 7 September 2010 (applying for the 2008–09 and later income years), by section 82(1) of the Taxation (Annual Rates, Trans-Tasman Savings Portability, KiwiSaver, and Remedial Matters) Act 2010 (2010 No 109).

Section IC 3(5) heading: added (with effect on 1 April 2008), on 7 September 2010 (applying for the 2008–09 and later income years), by section 82(1) of the Taxation (Annual Rates, Trans-Tasman Savings Portability, KiwiSaver, and Remedial Matters) Act 2010 (2010 No 109).

Section IC 3(5): added (with effect on 1 April 2008), on 7 September 2010 (applying for the 2008–09 and later income years), by section 82(1) of the Taxation (Annual Rates, Trans-Tasman Savings Portability, KiwiSaver, and Remedial Matters) Act 2010 (2010 No 109).

Section IC 3 list of defined terms foreign investment PIE: inserted, on 29 August 2011, by section 90(5) of the Taxation (Tax Administration and Remedial Matters) Act 2011 (2011 No 63).

Section IC 3 list of defined terms foreign PIE equivalent: inserted, on 29 August 2011, by section 90(5) of the Taxation (Tax Administration and Remedial Matters) Act 2011 (2011 No 63).

Section IC 3 list of defined terms land investment company: inserted, on 1 April 2010, by section 298(3)(b) of the Taxation (International Taxation, Life Insurance, and Remedial Matters) Act 2009 (2009 No 34).

Section IC 3 list of defined terms listed PIE: inserted, on 29 August 2011, by section 90(5) of the Taxation (Tax Administration and Remedial Matters) Act 2011 (2011 No 63).

Section IC 3 list of defined terms mixed-ownership enterprise: inserted, on 30 June 2012, by section 11 of the Public Finance (Mixed Ownership Model) Amendment Act 2012 (2012 No 45).

Section IC 3 list of defined terms multi-rate PIE: inserted, on 1 April 2010, by section 298(3)(b) of the Taxation (International Taxation, Life Insurance, and Remedial Matters) Act 2009 (2009 No 34).

Section IC 3 list of defined terms portfolio land company: repealed, on 1 April 2010, by section 298(3)(a) of the Taxation (International Taxation, Life Insurance, and Remedial Matters) Act 2009 (2009 No 34).

Section IC 3 list of defined terms portfolio land company: inserted, on 1 April 2008, by section 432(2) of the Taxation (Business Taxation and Remedial Matters) Act 2007 (2007 No 109).

Section IC 3 list of defined terms portfolio tax rate entity: repealed, on 1 April 2010, by section 298(3)(a) of the Taxation (International Taxation, Life Insurance, and Remedial Matters) Act 2009 (2009 No 34).

Section IC 3 list of defined terms voting interest: inserted, on 1 April 2010, by section 298(3)(b) of the Taxation (International Taxation, Life Insurance, and Remedial Matters) Act 2009 (2009 No 34).