TIB index based from the NZ Tax Information Bulletin - kwister.net
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03:46:51
29 Dec 2024
03:46:51
29 Dec 2024
TIB index based from the NZ Tax Information Bulletin - kwister.net
Disposition of real property for inadequate consideration - BR Pub 05/02 to 05/10 - notice of withdrawal
Removal of binding rulings.Product ruling BR Prd 17/02
The Arrangement is the use of the LogbookMe product (LogbookMe) by taxpayers to record details of their vehicular trips. LogbookMe is a cloud-based online platform which uses an on-board electronic recording device to log data about a vehicles' trip. Logbook Me Pty Ltd (LMP) an Australian registered and resident company owns and maintains the LogbookMe product, which is licensed on a wholesale basis to Fleet NZ Ltd (FleetPartners).Taxation (Business Tax, Exchange of Information, and Remedial Matters) Act 2017
The three main policy proposals in the Bill were: changes to make the taxation of business tax simpler, including new provisional tax rules, implementing the G20/OECD standard for Automatic Exchange of Information in financial accounts, and changes to tighten New Zealand's disclosure requirements for foreign trusts, as recommended by the Government's inquiry into foreign trust disclosure rules.Taxation (Business Tax, Exchange of Information, and Remedial Matters) Act 2017: AUTOMATIC EXCHANGE OF INFORMATION
Changes have been made to the Income Tax Act 2007 and the Tax Administration Act 1994, to incorporate the G20/OECD standard for Automatic Exchange of Financial Account Information in Tax Matters into New Zealand domestic law.Taxation (Business Tax, Exchange of Information, and Remedial Matters) Act 2017: FOREIGN TRUST DISCLOSURE RULES
The Taxation (Business Tax, Exchange of Information, and Remedial Matters) Act 2017 introduced increased disclosure requirements for foreign trusts with New Zealand-resident trustees. These include requirements for the trust to register with Inland Revenue, file annual disclosure returns, and pay registration and filing fees. In addition, the register of foreign trusts would be shared with certain New Zealand government agencies.Taxation (Business Tax, Exchange of Information, and Remedial Matters) Act 2017: SIMPLIFIED BUSINESS TAX PROCESSES
Changes have been made to the business tax rules following enactment of the Taxation (Business Tax, Exchange of Information, and Remedial Matters) Bill on 21 February 2017.Taxation (Business Tax, Exchange of Information, and Remedial Matters) Act 2017: SIMPLIFIED BUSINESS TAX PROCESSES - Safe harbour for all taxpayers using the standard provisional tax method
Amendments have been made which modify the application of UOMI to taxpayers who make all but their last instalment of provisional tax using the standard method (commonly known as the standard 'uplift' method). For these taxpayers, UOMI will no longer apply from the first instalment. Instead, it will commence from the date of the final instalment of provisional tax.Taxation (Business Tax, Exchange of Information, and Remedial Matters) Act 2017: SIMPLIFIED BUSINESS TAX PROCESSES - Safe harbour from use-of-money interest
Amendments have been made that modify the existing safe harbour from UOMI. The changes increase the safe harbour from $50,000 to $60,000 of residual income tax and extend the safe harbour to non-individual taxpayers.Taxation (Business Tax, Exchange of Information, and Remedial Matters) Act 2017: SIMPLIFIED BUSINESS TAX PROCESSES - Allowing contractors to elect their own withholding rate
An amendment has been made which will allow contractors who are subject to the schedular payment rules to elect their own withholding rate without having to apply to Inland Revenue for a special tax code.Taxation (Business Tax, Exchange of Information, and Remedial Matters) Act 2017: SIMPLIFIED BUSINESS TAX PROCESSES - Extending withholding to labour-hire firm contractors
Amendments have been made which extend the schedular payment rules to contractors that work for labour-hire firms.Taxation (Business Tax, Exchange of Information, and Remedial Matters) Act 2017: SIMPLIFIED BUSINESS TAX PROCESSES - Voluntary withholding agreements
Amendments have been made which will allow contractors not covered by the schedular payment rules to opt in to the rules with the consent of their payer.Taxation (Business Tax, Exchange of Information, and Remedial Matters) Act 2017: SIMPLIFIED BUSINESS TAX PROCESSES - Use-of-money interest and transfers of tax
Amendments have been made to sections 120C, 173L, 173M and 173S of the Tax Administration Act 1994 to prevent taxpayers from transferring tax to an earlier period that exceeds the amount in debt or in dispute in that period, and to clarify when UOMI starts and when a transfer takes effect for GST refunds and GST overpayments.Taxation (Business Tax, Exchange of Information, and Remedial Matters) Act 2017: SIMPLIFIED BUSINESS TAX PROCESSES - Amending the rules for new and increased assessments by the Commissioner
Section 142A of the Tax Administration Act 1994 has been amended to enable the Commissioner to offset any credits or refunds the taxpayer has against the taxpayer's tax liability arising from a new or increased assessment by the Commissioner.Taxation (Business Tax, Exchange of Information, and Remedial Matters) Act 2017: SIMPLIFIED BUSINESS TAX PROCESSES - Administration of the late payment penalty rules
An amendment has been made to section 139B of the Tax Administration Act to enable Inland Revenue to continue to administer the late payment penalty grace period during the period in which tax types are operated out of two Inland Revenue software systems - FIRST (the older system) and START (the new system). An amendment to section 138E has been made to ensure certain rights of challenge do not apply to section 139B.Taxation (Business Tax, Exchange of Information, and Remedial Matters) Act 2017: SIMPLIFIED BUSINESS TAX PROCESSES - Cancellation of interest
Amendments have been made to modify the cancellation of interest rules, in certain circumstances, to help Inland Revenue to simplify the process of issuing cancelled interest statements to taxpayers who mistakenly overpayTaxation (Business Tax, Exchange of Information, and Remedial Matters) Act 2017: DISCLOSING REPORTABLE UNPAID TAX TO CREDIT REPORTING AGENCIES
An amendment to the tax secrecy rules allows the Commissioner of Inland Revenue to disclose a taxpayer's information and their significant tax debt to approved credit reporting agencies. The Commissioner will ensure the taxpayer's circumstances meet the prescribed criteria before initially disclosing the information. Once the information has been initially disclosed, the Commissioner may continue to do so until the tax debt has been resolved.Taxation (Business Tax, Exchange of Information, and Remedial Matters) Act 2017: LATE PAYMENT PENALTY
An amendment has been made to section 139B of the Tax Administration Act 1994 that means Inland Revenue will no longer impose a 1% monthly incremental late payment penalty on unpaid tax from Goods and Services Tax (GST), income tax and Working for Families tax credit overpayments. The amendment only applies to certain tax periods.Taxation (Business Tax, Exchange of Information, and Remedial Matters) Act 2017: TRANSITIONAL REGULATIONS
The Tax Administration Act 1994 has been amended to provide a regulation-making power to resolve any potential transitional problems arising during the period when Inland Revenue's older FIRST software system and its new START system are both in useTaxation (Business Tax, Exchange of Information, and Remedial Matters) Act 2017: EXCHANGE OF INFORMATION BETWEEN THE COMMISSIONER AND THE REGISTRAR OF COMPANIES
The Tax Administration Act has been amended, to allow Inland Revenue to share information with the Companies Office (within the Ministry of Business, Innovation and Employment). The amendment allows information to be shared for the purpose of preventing, detecting, investigating or providing evidence of, certain serious offences under the Companies Act 1993 (those punishable by a term of imprisonment of four years or more). The change is part of the Government's Better Public Services initiative to improve the quality of public sector services through the sharing of targeted information between specified government agenciesTaxation (Business Tax, Exchange of Information, and Remedial Matters) Act 2017: BUSINESS TAX - OTHER MATTERS - Motor vehicle expenditure of close companies
The amendment enables close companies that operate like a sole trader to use an alternative to fringe benefit tax (FBT) when accounting for the business and private use of a motor vehicle owned by the company and used by a shareholder-employee. Close companies that meet certain criteria can elect to use the motor vehicle expenditure rules in subpart DE instead of paying FBT on the value of the private use of the vehicle by the shareholder-employee.Taxation (Business Tax, Exchange of Information, and Remedial Matters) Act 2017: BUSINESS TAX - OTHER MATTERS - Increased threshold for taxpayer self-corrections of minor errors
The amendment increases the self-correction threshold for minor errors in section 113A of the Tax Administration Act 1994 from $500 to $1,000. This allows taxpayers to correct simple errors of up to $1,000 in their next tax return, after the discovery of the error.Taxation (Business Tax, Exchange of Information, and Remedial Matters) Act 2017: BUSINESS TAX - OTHER MATTERS - Simplified calculation of deductions for dual use vehicles and premises
Amendments allow taxpayers to use a simplified method for the calculation of deductions for premises and vehicles that are used for both business and other purposes, such as private use.Taxation (Business Tax, Exchange of Information, and Remedial Matters) Act 2017: BUSINESS TAX - OTHER MATTERS - Remove the requirement to renew RWT exemption certificates annually
The amendments to sections 32H and 32I of the Taxation Administration Act 1994 enable most resident withholding tax (RWT) exemption certificates to be issued for an unlimited period.Taxation (Business Tax, Exchange of Information, and Remedial Matters) Act 2017: BUSINESS TAX - OTHER MATTERS - Increased threshold for annual FBT returns from $500,000 to $1 million of PAYE/ESCT
The threshold for calculating and returning FBT on an annual basis has increased from $500,000 to $1 million of PAYE/ESCTTaxation (Business Tax, Exchange of Information, and Remedial Matters) Act 2017: BUSINESS TAX - OTHER MATTERS - Modifying the 63-day rule on employee remuneration
An amendment to section EA 4 enables taxpayers to choose whether to apply the deferred payment of employment income rule in section EA 4.Taxation (Business Tax, Exchange of Information, and Remedial Matters) Act 2017: COLLECTING TAX ON EMPLOYEE SHARE SCHEMES USING THE PAYE SYSTEM - TECHNICAL CLARIFICATIONS
Technical changes have been made to sections CE 2(11) and RD 6(3) relating to when an employer elects to withhold tax under the PAYE rules on benefits an employee receives under an employee share scheme. The changes affect the timing and calculation of PAYE for employers that are generally required to provide Inland Revenue with a PAYE income payment form on the 20th of the month in which PAYE is withheld.Taxation (Business Tax, Exchange of Information, and Remedial Matters) Act 2017: INTEREST-FREE STUDENT LOANS
The Student Loan Scheme Act 2011 has been amended by introducing new provisions under which student loans are interestfree for overseas-based borrowers. The borrowers must be in receipt of a New Zealand Government-funded scholarship for full-time study or an internship undertaken overseas. Borrowers are required to provide evidence of their scholarship from Education New Zealand in order to be eligible for an interest-free student loan.Taxation (Business Tax, Exchange of Information, and Remedial Matters) Act 2017: LAND PROVISIONS - Bright-line
An amendment has been made to section CB 6A, the provision that sets out the two-year bright-line test for residential land. The amendment clarifies the start-date for the bright-line test when there is a change of trustee for a trust.Taxation (Business Tax, Exchange of Information, and Remedial Matters) Act 2017: LAND PROVISIONS - Land remedials
An amendment has been made to the definition of 'offshore RLWT person' in section YA 1. The amendment ensures that for limited partnerships and look-through companies the definition applies at the partnership/company level.Taxation (Business Tax, Exchange of Information, and Remedial Matters) Act 2017: LAND PROVISIONS - Land remedials - Certificate of exemption requirements
An amendment has been made to section 54E, which sets out the requirements for a person being able to get an RLWT certificate of exemption. The amendment enables newly formed special purpose entities to apply for an exemption certificate if they are associated with a taxpayer who has the required record of complying with their tax obligations.Taxation (Business Tax, Exchange of Information, and Remedial Matters) Act 2017: LAND PROVISIONS - Land remedials - RLWT - transfers of relationship property
An amendment has been made to section RL 1, which imposes an obligation to pay RLWT on certain disposals of residential land. The amendment ensures that RLWT does not need to be paid when there is a transfer of residential land on a settlement of relationship property.Taxation (Business Tax, Exchange of Information, and Remedial Matters) Act 2017: LAND PROVISIONS - Land remedials - RLWT calculation - GST
An amendment has been made to section RL 4, which sets out how much RLWT must be paid or withheld if the RLWT rules apply. The amendment clarifies that the RLWT calculation is net of GST.Taxation (Business Tax, Exchange of Information, and Remedial Matters) Act 2017: LAND PROVISIONS - Land remedials - RLWT rules - drafting issue
An amendment has been made to section RL 2, which sets out when vendors must pay RLWT and how the payment is made.Taxation (Business Tax, Exchange of Information, and Remedial Matters) Act 2017: LAND PROVISIONS - Land remedials - Technical amendment - application date for section CB 15B(3)
Section CB 15B(3) specifies the date land is acquired through the exercise of an option. That provision was amended by the Taxation (Residential Land Withholding Tax, GST on Online Services, and Student Loans) Act 2016. It was intended that the amendment would apply from the date of enactment of that Act.Taxation (Business Tax, Exchange of Information, and Remedial Matters) Act 2017: AGENCY RULES: UNINTENDED LEGISLATIVE CHANGE CORRECTED
The agency rules in subpart HD apply to a person declared to be an agent for income tax purposes on behalf of principals who are not present in, or are a non-resident of, New Zealand. Some of the agency rules relate solely to business activity and some relate to non-business activity, such as rentals collected on behalf of investment in New Zealand property by non-residents.Use-of-money interest rate changes (27 Mar 2017)
The use-of-money interest rates on underpayments and overpayments of taxes and duties have changed, in line with market interest rates. The new rates are:IS 17/02: Income tax - deductibility of farmhouse expenses
This Interpretation Statement considers the deductibility of expenditure relating to a farmhouse that forms part of a farming business. The Interpretation Statement withdraws and replaces a number of Public Information Bulletin and Tax Information Bulletin items about certain expenses for which farmers can claim deductions (these are listed at [24] of this Interpretation Statement). According to these items, the Commissioner has permitted full-time farmers to claim full deductions for both rates and interest payable on farm mortgages, and has allowed all farmers to claim 25% deductions on expenses relating to the farmhouse. The Commissioner considers that the deductions allowed in those items are no longer appropriate and the general rules of deductibility and apportionment, as explained in this Interpretation Statement, will applyIS 17/03: Goods and services tax - single supply or multiple supplies
A registered person who enters into a contract with a recipient to supply several goods and services needs to determine what sort of supply or supplies they have made so they can correctly account for GST. Where multiple elements are supplied with potentially different GST treatments, the supplier must determine whether they have made a single composite supply (of all the elements) with a single GST treatment, or multiple separate supplies (of each element or a combination of elements) with different GST treatments.QB 17/01: Depreciation Treatment For 'Buildings With Prefabricated Stressed-Skin Insulation Panels'
This Question We’ve Been Asked provides guidance for both taxpayers and Inland Revenue staff on which buildings the Commissioner considers come within the asset class “Buildings with prefabricated stressed-skin insulation panels” in the “Buildings and Structures” asset category in the Commissioner’s Table of Depreciation Rates.QB 17/02: Income tax - date of acquisition of land, and start date for 2-year bright-line test
This QWBA explains when someone acquires land for the purposes of those provisions. It also sets out when the 2-year period starts for the bright-line test in s CB 6A. The date of acquisition and the start date for the 2-year period are usually different dates.Determination FDR 2017/01 - A type of attributing interest in a foreign investment fund for which a person may not use the fair dividend rate method (Russell Investment Company plc: NZDH-A-DURH class shares).
Shares in the Russell Investment Company plc (RIC), an Irish public limited company to which this determination applies, are an attributing interest in a foreign investment fund (FIF) for New Zealand resident investors. RIC is structured as an umbrella fund with segregated liability between sub-funds. Those sub-funds do not have a separate legal personality under Irish law.Special Determination S52: Valuation of Shares Issued by Bank following a Non-Viabilty Trigger Event
This determination relates to a funding transaction involving the issue of Notes by the Bank to wholesale investors pursuant to a Deed Poll. The Notes will contain a conversion mechanism, whereby the Bank will immediately and irrevocably convert Notes into ordinary shares in Bank upon the occurrence of a Non-Viability Trigger Event, in order to allow them to be recognised as Tier 2 capital for the purposes of the Reserve Bank of New Zealand framework relating to the capital adequacy of banksSpecial Determination S53: Application of the financial arrangements rules to a public-private partnership agreement
This determination relates to an arrangement (the Project) involving the finance, design, construction and on-going provision of operational services in respect of the Facilities by a limited partnership (Contractor LP) under a public-private partnership agreement (the Project Agreement) with the Crown. The sole limited partner in Contractor LP will be Hold LP, holding 100% of Contractor LP.Foreign currency amounts - conversion to New Zealand dollars (for the 12 months ending 31 March 2017)
This article provides the exchange rates acceptable to Inland Revenue for converting foreign currency amounts to New Zealand dollars under the controlled foreign company ('CFC') and foreign investment fund ('FIF') rules for the 12 months ending 31 March 2017.Are Embankments and Runway End Safety Areas Depreciable Property? No says the Court of Appeal.
Due to updated Civil Aviation Rules, Queenstown Airport Corporation Limited ('QA') was required to provide a minimum 90-metre Runway End Safety Area ('RESA') at each end of its runway. Due to the steep drop-off into the Shotover River on the east end of the runway, QA constructed a 45-metre high embankment upon which to place the RESA and sought to deduct the construction costs on the basis the RESA was a depreciable land improvement.Court of Appeal dismisses Honk Land Trustee Limited's appeal in relation to a $1.1m management fee tax deduction
The Court of Appeal upheld decisions of the High Court and the Taxation Review Authority ('the TRA') confirming the Commissioner of Inland Revenue's ('the Commissioner') disallowance of a $1,116,000 management fee for income tax purposes. The Court of Appeal dismissed Honk Land Trustees Limited's ('HLT') appeal on the following alternative grounds: (1) there was no satisfactory evidence to show that management services were in fact provided; (2) there was no sufficient nexus shown; and (3) in the event the management fees were deductible, they were nevertheless part of a void tax avoidance arrangement. Additionally, the Court of Appeal agreed that the Commissioner was entitled to impose abusive tax position shortfall penalties.TRA considers residency of individuals
This is the first case involving an individual's residence status since the Court of Appeal's decision in Commissioner of Inland Revenue v Diamond [2015] NZCA 613 ('Diamond'). The Taxation Review Authority ('the Authority'), applying Diamond, considered that the disputant, a professional mariner, had a permanent place of abode in New Zealand in the years in dispute.