New Zealand Legislation: Bills

15 Foreign investment fund income

• (1) In section CD 36, after the heading, “ Amount not dividend” is inserted as a subsection heading.

  (2) In section CD 36(b)(iv), “method; and” is replaced by “method.”, and paragraph (c) is repealed.

  (3) After section CD 36(b), the following are inserted as subsections (2) and (3):

  “Exclusion for interests in grey list companies

  • “(2) Subsection (1)(b)(iv) does not apply if—

    • “(a) the FIF is a grey list company; and

    • “(b) the person holds a direct income interest of 10% or more in the FIF at the beginning of the income year in which the period falls.

  “Application of rule for certain managed funds

  • “(3) Subsection (2) does not apply if—

    • “(a) the person is a portfolio investment entity, an entity eligible to be a portfolio investment entity, or a life insurance company; and

    • “(b) the FIF is a foreign investment vehicle.”

  (4) Section CD 36(3)(b), is replaced by the following:

  • “(b) the FIF is a foreign PIE equivalent.”

  (5) In section CD 36, in the list of defined terms, “direct income interest”, “foreign investment vehicle”, “life insurance”, and “portfolio investment entity” are inserted.

  (6) In section CD 36, in the list of defined terms, “foreign investment vehicle ” is omitted and “foreign PIE equivalent” is inserted.

  (7) Subsections (4) and (6) apply for the 2009–10 and later income years.

  (7) Subsection (4) applies for the 2010–11 and later income years.