Taxation (Annual Rates for 2020–21, Feasibility Expenditure, and Remedial Matters) Act 2021

  • Sections 4, 135(25), and 203 corrected on 29 April 2021 under section 25(1)(j)(iii) and (v) of the Legislation Act 2012.
Coat of Arms of New Zealand

Taxation (Annual Rates for 2020–21, Feasibility Expenditure, and Remedial Matters) Act 2021

Public Act
 
2021 No 8
Date of assent
 
30 March 2021
Commencement
 
see section 2

Contents

1Title
2Commencement
3Annual rates of income tax for 2020–21 tax year
4Income Tax Act 2007
5Section BC 7 amended (Income tax liability of person with schedular income)
6Section CB 6A replaced (Disposal within 5 years: bright-line test for residential land)
CB 6ADisposal within 10 years: bright-line test for residential land
7Section CB 13 amended (Disposal: amount from major development or division and not already in income)
8Section CB 14 amended (Disposal: amount from land affected by change and not already in income)
9Section CB 15B amended (When land acquired)
10Section CB 16A replaced (Main home exclusion for disposal within 5 years)
CB 16AMain home exclusion for disposal within 10 years
11Section CB 16 amended (Residential exclusion from sections CB 6 to CB 11)
12Section CB 19 amended (Business exclusion from sections CB 6 to CB 11)
13Section CB 23B amended (Land partially disposed of or disposed of with other land)
14New heading and section CC 14 inserted
CC 14NZ IFRS 16 leases
15Section CD 1 amended (Dividend)
16Section CD 43 amended (Available subscribed capital (ASC) amount)
17Section CE 6 amended (Trusts are nominees)
18New heading and section CH 13 inserted
CH 13Feasibility expenditure clawback
19Section CW 26C amended (Meaning of exempt ESS)
20Section CW 55BB amended (Minors’ income, to limited extent)
21Section CW 58 amended (Disposal of companies’ own shares)
22Section CX 56 amended (Attributed income of certain investors in multi-rate PIEs)
23Section CX 60 amended (Intra-group transactions)
24New section CZ 37 inserted (Income equalisation schemes)
CZ 37Income equalisation schemes
25New section CZ 38 inserted (Disposals of trading stock to non-associates without business purpose)
CZ 38Disposals of trading stock to non-associates without business purpose
26New sections CZ 39 and CZ 40 inserted
CZ 39Disposal within 5 years: bright-line test for residential land: acquisition on or after 29 March 2018
CZ 40Main home exclusion for bright-line: acquisition on or after 29 March 2018
27Section DB 23 amended (Cost of revenue account property)
28New section DB 23C inserted (Revenue account property: cost of some residential land reduced)
DB 23CRevenue account property: cost of some residential land reduced
29Section DB 29 amended (Apportionment when land acquired with other property)
30New heading and section DB 51C inserted
DB 51CNZ IFRS 16 leases
31Section DB 53 amended (Attributed PIE losses of certain investors)
32New heading and sections DB 66 and DB 67 inserted
DB 66Feasibility expenditure: spread deduction
DB 67Feasibility expenditure: immediate deduction
33Section DT 1A amended (Ring-fenced allocations)
34Section ED 3 amended (Part-year tax calculations for transfers: general insurance OCR)
35Section EE 40 amended (Transfer of depreciable property on or after 24 September 1997)
36Section EH 1 amended (Income equalisation schemes)
37Section EH 5 amended (Main income equalisation account)
38Section EH 13 amended (Refund on application)
39Section EH 35 amended (Meaning of main maximum deposit)
40Section EH 36 amended (Other definitions)
41Section EH 61 amended (Meaning of adverse event maximum deposit)
42Section EJ 3 amended (Spreading forward of fertiliser expenditure)
43Section EJ 10 amended (Personal property lease payments)
44New section EJ 10B inserted (IFRS leases)
EJ 10BIFRS leases
45Section EL 2 amended (Outline of subpart: specific provisions)
46Section EL 3 amended (Definitions for this subpart)
47Section EL 14 amended (Continuity rules for companies)
48Section EL 20 amended (Allocation of deductions related to bright-line disposals of residential land)
49Section EW 15I amended (Mandatory use of yield to maturity method for some arrangements)
50Section EW 48 amended (Anti-avoidance provisions)
51Section EX 21 amended (Attributable CFC amount and net attributable CFC income or loss: calculation rules)
52Section EX 28 amended (Meaning of FIF)
53Section EY 5 amended (Part-year tax calculations)
54Section EY 7 amended (Meaning of claim)
55Section EY 11 amended (Superannuation schemes providing life insurance)
56New section EZ 4B inserted (Cattle destroyed because of Mycoplasma bovis: spreading)
EZ 4BCattle destroyed because of Mycoplasma bovis: spreading
57New cross-heading and sections EZ 80 and EZ 81 inserted
EZ 80Refund of excess deposit in main income equalisation account as consequence of election under section EZ 4B
EZ 81Refund of excess deposit in adverse event income equalisation account as consequence of election under section EZ 4B
58Cross-heading above section EZ 80 repealed
59Section EZ 80 renumbered (Transfers of deposits when adverse event income equalisation accounts abolished)
60Section EZ 81 amended (Refund of excess deposit in adverse event income equalisation account as consequence of election under section EZ 4B)
61Section FB 3A amended (Residential land)
62Section FC 9 amended (Residential land transferred to executor, administrator, or beneficiary on death of person)
63Section FE 2 amended (When this subpart applies)
64Section FE 6 amended (Apportionment of interest by excess debt entity)
65Section FE 12 amended (Calculation of debt percentages)
66Section FE 22 amended (Notional offshore investment)
67Section FH 3 amended (Payments under financial instruments producing deduction without income)
68Section FH 7 amended (Payments to person outside New Zealand producing deduction without income)
69Section FH 12 amended (Offset of mismatch amounts against surplus assessable income)
70Section FM 18 amended (Financial arrangements: transfer from company A to company B)
71Section FO 10 amended (When property passes on resident’s restricted amalgamation)
72Section FO 12 amended (Financial arrangements: resident’s restricted amalgamation, companies in wholly-owned group)
73Section FO 17 amended (Land)
74New section FZ 9 inserted (Transfers of trading stock to non-associates, donee organisations, or public authorities)
FZ 9Transfers of trading stock to non-associates, donee organisations, or public authorities
75Section GB 3 amended (Arrangements for carrying forward loss balances: companies)
76New sections GB 3BA to GB 3BAC inserted
GB 3BAArrangements for carrying forward loss balances: companies’ business activities
GB 3BABArrangements to inject income into companies carrying forward loss balances
GB 3BACArrangements to shift expenditure from companies carrying forward loss balances
77Section GB 20 amended (Arrangements involving petroleum and mineral mining)
78Section GB 52 amended (Arrangements involving residential land: companies’ shares)
79Section GB 53 amended (Arrangements involving residential land: trusts)
80Section GC 8 amended (Insufficient amount receivable by person)
81Section GC 16 amended (Credit rating of borrower: other than insuring or lending person)
82Section GC 18 amended (Loan features disregarded by rules for transfer pricing arrangements)
83New heading and sections GC 20 and GC 21 inserted
GC 20Effect of purchase price allocation agreement
GC 21Purchase price allocation required: no agreement
84New sections GZ 4 and GZ 5 inserted
GZ 4Disposals of trading stock to donee organisations or public authorities
GZ 5Disposals of trading stock to non-associates
85Section HC 6 amended (Beneficiary income)
86Section HC 10 amended (Complying trusts)
87Section HC 24 amended (Trustees’ obligations)
88Section HC 27 amended (Who is a settlor?)
89Section HC 30 amended (Treatment of foreign trusts when settlor becomes resident)
90Section HC 33 amended (Choosing to satisfy income tax liability of trustee)
91Section HM 36B amended (Calculating PIE schedular tax adjustments for natural person investors)
92Section HM 52 amended (Use of foreign tax credits by zero-rated and certain exiting investors)
93Section HM 56 amended (Prescribed investor rates: schedular rates)
94Section IA 2 amended (Tax losses)
95Section IA 3 amended (Using tax losses in tax year)
96Section IA 5 amended (Restrictions on companies’ loss balances carried forward)
97Section IA 7 amended (Restrictions relating to ring-fenced tax losses)
98Section IA 8 amended (Restrictions relating to schedular income)
99New subpart IB inserted (Carrying forward companies’ loss balances: continuity of business activities)
IB 1Purpose
IB 2Meaning of ownership continuity breach
IB 3When tax loss components of companies carried forward despite ownership continuity breach
IB 4Business continuity period
IB 5When group companies treated as single company
100Section IC 2 amended (Threshold levels for grouping tax losses in tax year)
101Section IC 5 amended (Company B using company A’s tax loss)
102Section IC 10 amended (When companies have different balance dates)
103Section IC 12 amended (Bad debts or decline in value of shares)
104Section ID 1 amended (Treatment of tax losses by consolidated groups)
105Section ID 2 amended (Pre-consolidation losses: general treatment)
106Section IE 2 amended (Treatment of tax losses by amalgamating company)
107Section IE 3 amended (Treatment of tax losses by amalgamated company)
108Section IE 4 amended (Group companies’ treatment of tax losses on amalgamation)
109Section IP 1 amended (When this subpart applies)
110Section IP 3 amended (Continuity breach: tax loss components of companies carried forward)
111Section IQ 1 amended (General treatment)
112Section IQ 1B (Losses carried forward to tax year)
113Section IS 2 amended (Treatment of net losses resulting from certain expenditure)
114Section IZ 8 amended (Election to use net loss for 2019–20 or 2020–21 year as tax loss in preceding year)
115Section LA 6 amended (Remaining refundable credits: PAYE, RWT, and certain other items)
116Section LK 5 amended (Companies’ credits carried forward)
117Section LP 4 amended (Continuity rules for carrying credits forward)
118Section LS 3 amended (Tax credits for zero-rated investors)
119Section LS 4 amended (Tax credits for certain exiting investors)
120Section LY 5 amended (Eligible research and development expenditure)
121Section LY 8 amended (Carry forward for remaining research and development tax credits)
122Section MD 12 amended (Calculation of parental tax credit)
123Section MF 7 amended (Orders in Council)
124Section OB 52 replaced (ICA imputation credit of consolidated imputation group)
OB 52ICA transfer to consolidated imputation group
125Table O2 amended (Imputation debits)
126Section OP 22 replaced (Consolidated ICA group company’s credit)
OP 22Consolidated ICA transfer from group company’s ICA
127Table O19 amended (Imputation credits of consolidated imputation groups)
128Section RA 1 amended (What this Part does)
129Section RC 5 amended (Methods for calculating provisional tax liability)
130Section RD 24 amended (Exemptions for non-resident contractors)
131Section RE 2 amended (Resident passive income)
132Section RE 10C amended (Obligations of custodial institutions in relation to certain payments of investment income)
133Section RF 2C amended (Meaning of non-resident financial arrangement income)
134Section RL 1 amended (Residential land withholding tax)
135Section YA 1 amended (Definitions)
136Schedule 21 amended (Excluded activities for research and development activities tax credits)
137Schedule 21B amended (Expenditure or loss for research and development tax credits)
138Schedule 29 amended (Portfolio investment entities: listed investors)
139Schedule 32 amended (Recipients of charitable or other public benefit gifts)
140Schedule 36 amended (Government enterprises)
141Income Tax Act 2007: aligning nomenclature with Social Security Act 2018
142Other enactments: consequential amendments aligning nomenclature
143Tax Administration Act 1994
144Section 3 amended (Interpretation)
145Section 4A amended (Construction of certain provisions)
146Section 17B amended (Commissioner may require information or production of documents)
147Section 17C amended (Commissioner’s powers in relation to documents)
148Section 17E amended (Information or documents treated as in persons’ knowledge, possession, or control)
149Section 17H amended (Court may make order for provision of information)
150Section 20 amended (Privilege for confidential communications between legal practitioners and their clients)
151Section 20B amended (No requirement to disclose tax advice document)
152Section 20D amended (Claim that document is tax advice document)
153Section 20F amended (Person must disclose tax contextual information from tax advice document)
154Section 25E amended (Who must provide investment income information to Commissioner)
155Section 25J amended (Information on attributed PIE income: non-locked-in funds
156Section 25K repealed (Information on attributed PIE income: locked-in funds)
157Section 25MB amended (Information from custodial institutions)
158Section 54C amended (Information in relation to payment of RLWT)
159Section 54D amended (Information in relation to repayment of RLWT)
160Section 54E amended (RLWT certificate of exemption)
161Section 57B amended (Return requirements for multi-rate PIEs)
162Section 59BA amended (Annual return for trusts)
163Section 61 amended (Disclosure of interest in foreign company or foreign investment fund)
164Section 68CC amended (Research and development tax credits: greater than $2 million approval)
165Section 89D amended (Taxpayers and others with standing may issue notices of proposed adjustment)
166Section 89DA amended (Taxpayer may issue notice of proposed adjustment for taxpayer assessment)
167Section 91C amended (Taxation laws in respect of which binding rulings may be made)
168Section 108 amended (Time bar for amendment of income tax assessment)
169Section 120B amended (Persons excluded)
170Section 120KBB amended (Interest for most standard method and some estimation method provisional taxpayers)
171Section 139A amended (Late filing penalty for certain returns)
172Section 139AB amended (Penalty for member of large multinational group failing to provide information)
173Section 157 amended (Deduction of tax from payments due to defaulters)
174New section 173V inserted (Transfer of unclaimed money on request)
173VTransfer of unclaimed money on request
175Section 184A amended (Refund of tax paid in excess made by direct credit to bank account)
176New section 225ABA inserted (Orders in Council: periods for purposes of certain provisions of Income Tax Act 2007 relating to disposals of trading stock)
225ABAOrders in Council: periods for purposes of certain provisions of Income Tax Act 2007 relating to disposals of trading stock
177New section 227H inserted (Transitional provision relating to annual return for trusts)
227HTransitional provision relating to annual return for trusts
178Schedule 1 amended (Inland Revenue Acts)
179Schedule 7 amended (Disclosure rules)
180Schedule 8 amended (Reporting of income information by individuals and treatment of certain amounts)
181Goods and Services Tax Act 1985
182Section 2 amended (Interpretation)
183Section 8 amended (Imposition of goods and services tax on supply)
184Section 11 amended (Zero-rating of goods)
185Section 11AB amended (Zero-rating of telecommunications services)
186Section 25 amended (Credit and debit notes)
187Section 51 amended (Persons making supplies in course of taxable activity to be registered)
188Student Loan Scheme Act 2011
189Section 34 amended (Repayment codes for New Zealand-based borrowers who derive salary or wages)
190Section 208 amended (Disclosure of information between Inland Revenue Department and New Zealand Customs Service for information-matching purposes)
191KiwiSaver Act 2006
192Section 4 amended (Interpretation)
193Section 83 amended (Unclaimed money held by Commissioner)
194Section 53 amended (Dividends)
195Land Transfer Act 2017
196Section 77 amended (Interpretation)
197Section 79 replaced (Content of tax statement)
79Content of tax statement
198New section 82A inserted (Chief executive must supply tax information to Statistician)
82AChief executive must supply tax information to Statistician
199Section 83 amended (Other provisions concerning use of tax information)
200Section 85 amended (Status of tax information)
201Section 86 amended (Disclosure of information between authorised persons)
202Section 227 amended (Regulations)
203Schedule 1 amended (Transitional, savings, and related provisions)
204Unclaimed Money Act 1971
205Section 2 amended (Interpretation)
206Section 4 replaced (Unclaimed money)
4Meaning of unclaimed money
207Section 5 amended (Holder)
208New section 5B inserted (Obligations of holders)
5BObligations of holders
209Sections 6 and 7 repealed
210Section 8 amended (Payment of unclaimed money to Commissioner)
211Section 9 amended (Special arrangements may be made by Commissioner)
212Section 10 amended (Examination of accounts)
213Section 11 amended (Commissioner may make payment to claimant)
214New section 11B inserted (Capacity of trustees)
11BCapacity of trustees
215Section 12 repealed (Officers to maintain secrecy)
216Section 13 amended (Offences)
217Schedule repealed
218Regulation 3 amended (Reportable unpaid tax threshold)
219Section 4 amended (Section DB 65 repealed)
220Section 19 amended (Schedule 1, part D, table 2 amended)
Legislative history
Administrative information

The Parliament of New Zealand enacts as follows: