Taxation (Annual Rates for 2016–17, Closely Held Companies, and Remedial Matters) Bill

  • enacted
310 Section 11 amended (Zero-rating of goods)

(1)

In section 11(1)(k), before subparagraph (i), replace “section 11A(1)(h) or 11A(1)(i)” with “paragraph (i) or section 11A(1)(h) or (i)”.

(2)

Replace section 11(8) with:

(8)

The Commissioner may extend the 60-day period if the Commissioner is satisfied, upon the written application of the supplier, that the export of the boat or aircraft within the period is or has been prevented by circumstances that are beyond the control of the supplier and the recipient or that relate to supplies to which subsection (1)(k) or section 11A(1)(ib) applies.

(3)

After section 11(8D)(a), insert:

(ab)

a supply that is a surrender of a right to a payment under an agreement for the supply of an interest in land is a supply under subsection (1)(mb) if the supply of the interest in land meets the requirements set out in that subsection:

(4)

Replace section 11(8D)(b) with:

(b)

a supply of an interest in land that meets the requirements of subsection (1)(mb), and is made under an agreement providing for periodic payments for supplies of the interest in land, is not a supply under that subsection for the purposes of a payment for the supply paid or payable under the agreement if—

(i)

each amount payable under the agreement that is not a regular payment is anticipated, when the agreement is entered, to be 25% or less of the consideration specified in the agreement (the term consideration) for all supplies of the interest in land during the period referred to in subparagraph (iv); and

(ii)

the payment, if not a regular payment, is 25% or less of the term consideration; and

(iii)

each amount that is paid or payable before the payment, and is not a regular payment, is 25% or less of the term consideration; and

(iv)

the term consideration is treated as being the amount of consideration calculated under the agreement for supplies anticipated to be made during a period that is the longer of 1 year and the shortest possible fixed term of the agreement:

(5)

Replace section 11(8D) with:

(8D)

For the purposes of the zero-rating of land rules,—

(a)

a supply that is an assignment or surrender of an interest in land is a supply under subsection (1)(mb) if it meets the requirements set out in that subsection and paragraph (b) does not apply:

(ab)

a supply that is a surrender of a right to a payment under an agreement for the supply of an interest in land is a supply under subsection (1)(mb) if the supply of the interest in land meets the requirements set out in that subsection:

(b)

a supply of an interest in land that meets the requirements of subsection (1)(mb), and is made under an agreement providing for periodic payments for supplies of the interest in land, is not a supply under that subsection for the purposes of a payment for the supply paid or payable under the agreement if—

(i)

each amount payable under the agreement that is not a regular payment is anticipated, when the agreement is entered, to be 25% or less of the consideration specified in the agreement (the term consideration) for all supplies of the interest in land during the period referred to in subparagraph (iv); and

(ii)

the payment, if not a regular payment, is 25% or less of the term consideration; and

(iii)

each amount that is paid or payable before the payment, and is not a regular payment, is 25% or less of the term consideration; and

(iv)

the term consideration is treated as being the amount of consideration calculated under the agreement for supplies anticipated to be made during a period that is the longer of 1 year and the shortest possible fixed term of the agreement:

(c)

a supply by a person who is the lessee under a lease agreement is a supply under subsection (1)(mb), despite paragraph (b), if—

(i)

the supply is to a person who is not the lessor supplying an interest in land under the lease agreement to the lessee; and

(ii)

the supply is made under an arrangement that involves the lessee’s surrender of the interest in land to the lessor and the supply by the lessor of the interest in land under another lease agreement to a person other than the lessee; and

(iii)

the supplies of the interest in land under the lease agreements meet the requirements set out in subsection (1)(mb).

(5B)

In section 11(8D)(c)(iii), replace “subsection (1)(mb).” with “subsection (1)(mb):”.

(6)

After section 11(8D)(c), insert:

(d)

a registered person who is a non-profit body that is resident in New Zealand and acquires goods is treated, to the extent to which the person acquires the goods with an intention of using them other than for making exempt supplies, as acquiring the goods with the intention of using them for making taxable supplies.

(7)

Subsection (5) applies for a person for a supply made after 30 June 2014, except for a supply for which the person takes a tax position in a return, before the date on which the Taxation (Annual Rates for 2016–17, Closely Held Companies and Remedial Matters) Act 2016 receives the Royal assent, that is inconsistent with the amendment made by subsection (5).