Taxation (Annual Rates, Employee Allowances, and Remedial Matters) Act 2014

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Taxation (Annual Rates, Employee Allowances, and Remedial Matters) Act 2014

Public Act2014 No 39
Date of assent30 June 2014
Commencementsee section 2

Contents

1 Title

2 Commencement

Part 1
Annual rates of income tax

3 Annual rates of income tax for 2014–15 tax year

Part 2
Amendments to Income Tax Act 2007

4 Income Tax Act 2007 amended

5 Section BB 3 amended (Overriding effect of certain matters)

6 Section BH 1 amended (Double tax agreements)

7 New section CB 15B inserted (When land acquired)

8 Section CB 26 amended (Disposal of certain shares by portfolio investment entities)

9 Section CC 1 amended (Land)

10 Section CC 1B replaced (Consideration for agreement to grant, renew, extend, or transfer leasehold estate or licence)

11 Section CC 1C amended (Consideration for agreement to surrender leasehold estate or terminate licence)

12 Section CD 32 amended (Employee benefits)

13 Section CD 40 amended (Adjustment if dividend recovered by company)

14 Section CE 1 amended (Amounts derived in connection with employment)

15 New sections CE 1B to CE 1E inserted

16 Section CE 5 amended (Meaning of expenditure on account of an employee)

17 Section CG 2 amended (Remitted amounts)

18 New sections CG 2B to CG 2E inserted

19 New section CG 7B inserted (Disposals or applications after earlier deductions)

20 Section CT 1 amended (Disposal of exploratory material or petroleum mining asset)

21 Section CT 7 amended (Meaning of petroleum mining asset)

22 New section CV 17 inserted (Non-exempt charities: taxation of tax-exempt accumulation)

23 Section CV 19 amended (Additional income for certain imputation credits)

24 New sections CW 16B to CW 16F inserted

25 Section CW 17 amended (Expenditure on account, and reimbursement, of employees)

26 New section CW 17CB inserted (Payments for certain work-related meals)

27 New section CW 17CC inserted (Payments for distinctive work clothing)

28 Section CW 38 amended (Public authorities)

29 Section CW 39 amended (Local authorities)

30 Section CW 41 amended (Charities: non-business income)

31 Section CW 42 amended (Charities: business income)

32 New section CW 42B inserted (Community housing trusts and companies)

33 Section CW 46 amended (Bodies promoting amateur games and sports)

34 Section CW 57 amended (Non-resident company involved in exploration and development activities)

35 Section CX 19 amended (Benefits provided instead of allowances)

36 Section CZ 23 amended (Employee benefits for Canterbury earthquake relief: exempt income)

37 New section CZ 29 inserted (Accommodation expenditure: Canterbury earthquake relief)

38 New section CZ 30 inserted (Transitional provision: application of certain accommodation provisions)

39 New section CZ 31 inserted (Accommodation expenditure: New Zealand Defence Force)

40 New section CZ 32 inserted (Treatment of certain petroleum storage facilities)

41 Section DB 1 amended (Taxes, other than GST, and penalties)

42 Section DB 10 amended (Interest or expenditure connected to profit-related or substituting debentures)

43 Section DB 19 amended (Expenses of failed or withdrawn application for resource consent)

44 Section DB 20B amended (Consideration for agreement to grant, renew, extend, or transfer leasehold estate or licence)

45 Section DB 20C amended (Consideration for agreement to surrender leasehold estate or terminate licence)

46 Section DB 25 amended (Cancellation of shares held as revenue account property)

47 Section DB 37 amended (Expenses of failed or withdrawn patent application)

48 New section DB 40BA inserted (Expenses in application for plant variety rights)

49 Section DB 55 amended and repealed (Expenditure incurred in deriving exempt income)

50 New heading and sections DB 63 to DB 63C inserted

51 Section DD 4 amended (Employment-related activities)

52 Section DD 10 amended (Interpretation: reimbursement and apportionment)

53 Section DG 6 amended (Associated persons: company rule modified)

54 Section DG 9 amended (Apportionment formula)

55 Section DG 11 amended (Interest expenditure: close companies)

56 Section DG 16 amended (Quarantined expenditure when asset activity negative)

57 Section DG 17 amended (Allocation of amounts quarantined under section DG 16)

58 Section DZ 21 amended (Expenditure on certain assets before 31 March 2013)

59 Amendments to examples in subparts DG and DZ

60 Section DO 5 amended (Expenditure on land: planting of listed horticultural plants)

61 Section DP 8 amended (Forestry business on land bought from the Crown, Maori owners, or holding company: no deduction)

62 Section DU 1 amended (Mining expenditure: prospecting and exploration expenditure)

63 Section DU 11 amended (Meaning of mining development expenditure: exclusion of operational expenditure)

64 Section EA 3 amended (Prepayments)

65 Section EE 7 amended (What is not depreciable property?)

66 Section EE 25 amended (Depreciation loss for plant variety rights application granted in 2005–06 or later income year)

67 Section EE 57 amended (Base value in section EE 56 when none of sections EE 58, EE 59, and EZ 22(1) applies)

68 Section EE 67 amended (Other definitions)

69 Section EG 1 amended (Election to use balance date used in foreign country)

70 Section EI 4B amended (Consideration for agreement to grant, renew, extend, or transfer leasehold estate or licence)

71 Section EI 7 amended (Leases: income derived in anticipation)

72 Section EI 8 amended (Disposal of land to the Crown)

73 Section EJ 20D amended (Measurement of assumed life of mine and application to rate)

74 Section EJ 20E amended (Certain mining expenditure spread on the basis of units of production)

75 Section EW 8 amended (Some short-term agreements for sale and purchase acquired in business: election to treat as financial arrangements)

76 Section EW 15D amended (IFRS financial reporting method)

77 Section EW 15F amended (Expected value method)

78 Section EW 15G amended (Modified fair value method)

79 Section EW 15H amended (Mandatory use of some determinations)

80 Section EW 15I amended (Mandatory use of yield to maturity method for some arrangements)

81 Section EW 32 amended (Consideration for agreement for sale and purchase of property or services, hire purchase agreement, specified option, or finance lease)

82 New sections EW 33B and EW 33C inserted

83 Section EW 35 amended (Value relevant for non-financial arrangements rule)

84 Section EX 5 amended (Direct control interests)

85 Section EX 9 amended (Direct income interests)

86 Section EX 20B amended (Attributable CFC amount)

87 Section EX 20C amended (Net attributable CFC income or loss)

88 Section EX 20D amended (Adjustment of cost fraction for excessively debt funded CFC)

89 Section EX 21B amended (Non-attributing active CFCs)

90 Section EX 21D amended (Non-attributing active CFC: default test)

91 Section EX 21E amended (Non-attributing active CFC: test based on accounting standard)

92 Section EX 22 amended (Non-attributing Australian CFCs)

93 Section EX 35 amended (Exemption for interest in FIF resident in Australia)

94 Section EX 46 amended (Limits on choice of calculation methods)

95 Section EX 50 amended (Attributable FIF income method)

96 Section EX 51 amended (Comparative value method)

97 Section EX 58 amended (Additional FIF income or loss if CFC owns FIF)

98 Section EZ 23B amended (Property acquired after depreciable property affected by Canterbury earthquakes)

99 Section EZ 32D amended (Value of asset fraction: CFC with excessive debt funding and loan entered before 21 June 2012)

100 New sections EZ 75 and EZ 76 inserted

101 New section EZ 77 inserted (Substituting debentures repeal: transitional rules)

102 Section FA 2 amended (Recharacterisation of certain debentures)

103 Section FB 15 amended (Specified livestock valued under herd scheme)

104 Section FC 5 amended (Land transferred to close relatives)

105 Section FE 1 amended (What this subpart does)

106 Section FE 2 amended (When this subpart applies)

107 Section FE 3 amended (Interest apportionment for individuals)

108 Section FE 4 amended (Some definitions)

109 Section FE 13 amended (Financial arrangements entered into with persons outside group)

110 Section FE 14 amended (Consolidation of debts and assets)

111 Section FE 16 amended (Total group assets)

112 Section FE 18 amended (Measurement of debts and assets of worldwide group)

113 Section FE 25 amended (New Zealand group for excess debt entity that is a company)

114 Section FE 26 amended (Identifying New Zealand parent)

115 New section FE 31D inserted (Worldwide group for entity with New Zealand parent depending on non-resident owning body)

116 New defined term inserted in lists for some sections in subpart FE

117 Section FM 5 amended (Liability when company leaves consolidated group)

118 Section FO 5 amended (Amalgamations and remitted liabilities)

119 Section GB 34 amended (ICA arrangements for carrying amounts forward)

120 New heading and new section GB 51 inserted

121 Section HA 31 amended (Revocation of directors' elections)

122 Section HC 27 amended (Who is a settlor?)

123 Section HC 30 amended (Treatment of foreign trusts when settlor becomes resident)

124 Section HC 31 amended (When existing trusts come into tax base)

125 Section HD 14 amended (Companies issuing debentures)

126 Section HF 11 amended (Choosing to become Maori Authority)

127 Section HM 1 amended (Outline of subpart and relationship with other Parts)

128 New heading and section HR 11 inserted

129 New section HR 12 inserted (Non-exempt charities: taxation of tax-exempt accumulation)

130 Section IW 1 amended (Shortfall penalties)

131 Section LD 3 amended (Meaning of charitable or other public benefit gift)

132 Section LJ 3 amended (Meaning of foreign income tax)

133 Section LJ 5 amended (Calculation of New Zealand tax)

134 Subpart LZ amended (Terminating provisions)

135 Section MB 1 amended (Adjustments for calculation of family scheme income)

136 Section MB 7B amended (Family scheme income from employment benefits: employees not controlling shareholders)

137 Section MB 13 amended (Family scheme income from other payments)

138 Section RD 5 amended (Salary or wages)

139 Section RD 6 amended (Certain benefits and payments)

140 Section RE 2 amended (Resident passive income)

141 Section RE 14 amended (Non-cash dividends other than certain share issues)

142 New section RE 18B (Capital value increase under inflation-indexed instruments: RWT cap)

143 Section RF 2 amended (Non-resident passive income)

144 Section YA 1 amended (Definitions)

145 Section YB 11 amended (Trustee and person with power of appointment or removal)

146 Section YD 1 amended (Residence of natural persons)

147 Schedule 14 amended (Depreciable intangible property)

148 Schedule 20 amended (Expenditure on farming, horticultural, aquacultural, and forestry improvements)

149 Schedule 32 amended (Recipients of charitable or other public benefit gifts)

Part 3
Amendments to other enactments

Tax Administration Act 1994

150 Tax Administration Act 1994 amended

151 Section 3 amended (Interpretation)

152 Section 22 amended (Keeping of business and other records)

153 Section 25 amended (RWT withholding certificates)

154 Section 33A amended (Annual returns of income not required)

155 Section 33AA amended (Exceptions to requirement for return of income)

156 Section 51 amended (RWT withholding reconciliation statements)

157 Section 81A amended (Disclosure of information under approved information sharing agreement)

158 New heading and section 91AAT inserted

159 Section 93 amended (Assessment of FBT)

160 Section 94 amended (Assessment of qualifying company election tax and additional tax)

161 Section 95 amended (Assessment of withdrawal tax)

162 Section 97 amended (Assessment of imputation penalty tax)

163 Section 97B amended (Assessment of Maori authority distribution penalty tax)

164 Section 98 amended (Assessment of ESCT)

165 Section 98B amended (Assessment of retirement scheme contribution withholding tax)

166 Section 99 amended (Assessment of RWT)

167 Section 100 amended (Assessment of NRWT)

168 Section 101 amended (Assessment of further income tax)

169 Section 101B amended (Assessment of imputation additional tax)

170 Section 141B amended (Unacceptable tax position)

171 Section 141EB amended (Promoter penalties)

172 Section 141FD repealed (Shareholders of loss-attributing qualifying companies)

173 Section 142A amended (New due date for payment of tax that is not a penalty)

174 Section 143 amended (Absolute liability offences)

175 Section 143A amended (Knowledge offences)

176 Section 173B amended (Definitions)

177 Section 176 amended (Recovery of tax by Commissioner)

178 Section 177 amended (Taxpayer may apply for financial relief)

179 Section 177A replaced (Definition of serious hardship)

180 Section 177B amended (Instalment arrangements)

181 Section 177C amended (Write-off of tax by Commissioner)

182 New Part 11B inserted (Foreign account information-sharing agreements)

183 New section 225D inserted (Regulations: community housing trusts and companies)

Goods and Services Tax Act 1985

184 Goods and Services Tax Act 1985 amended

185 Section 2 amended (Interpretation)

186 Section 3 amended (Meaning of term financial services)

187 Section 6 amended (Meaning of term taxable activity)

188 Section 11 amended (Zero-rating of goods)

189 Section 11A amended (Zero-rating of services)

190 Section 20 amended (Calculation of tax payable)

191 New section 21FB inserted (Treatment when use changes to total taxable or non-taxable use)

192 Section 21HB amended (Transitional rule related to treatment of dwellings)

193 Section 25 amended (Credit and debit notes)

194 Section 46 amended (Commissioner's right to withhold payments)

195 Section 54C amended (Non-residents: cancellation of registration)

Income Tax Act 2004

196 Income Tax Act 2004 amended

197 Section CD 29 amended (Adjustment if dividend recovered by company)

198 Section DB 44 amended (Expenditure incurred in deriving exempt income)

199 Section EE 7 amended (What is not depreciable property?)

200 Section EG 1 amended (Election to use balance date used in foreign country)

201 Section EX 5 amended (Direct control interests)

202 Section EX 9 amended (Direct income interests)

203 Section EX 44 amended (Comparative value method)

204 Section OB 1 amended (Definitions)

Child Support Act 1991

205 Child Support Act 1991 amended

206 Section 2 amended (Interpretation)

207 Section 9 amended (Social security beneficiaries must apply for formula assessment)

208 Section 40 amended (Estimated taxable income)

209 Section 44 amended (End-of-year reconciliation)

210 Section 65 amended (Child support voluntary agreement no bar to application for formula assessment)

211 Section 81 amended (Notification requirements of liable parent)

212 Section 92 amended (Requirements in relation to objections)

213 Section 98 amended (Minimum liability in respect of child support)

214 Section 142 amended (Payment of formula assessment child support to custodians who are social security beneficiaries)

215 Section 179A amended (Waiver of right to payment)

Schedule
Amendments to examples in subparts DG and DZ

Legislative history


The Parliament of New Zealand enacts as follows: