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Telecommunications Act 2001

Structural separation of Telecom - Taxation consequences of structural separation

69XU: Unpaid employment expenditure

You could also call this:

"Money a company must pay when taking over staff payments from another company"

Illustration for Telecommunications Act 2001

When a Chorus company takes over the responsibility to pay employment income, certain rules apply. These rules are found in the Income Tax Act 2007, specifically in sections DC 11(2) and (3) and EA 4(6). You need to think of the Chorus company as "person B" and the Telecom company that originally had to pay as "person A" for these rules to work.

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View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=DLM4187737.

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69XT: Bad debts, or

"What happens to unpaid debts when a telecom company changes hands"

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69XV: Vesting of designated assets and liabilities, or

"Transferring assets to Chorus without paying extra taxes"

Part 2AStructural separation of Telecom
Taxation consequences of structural separation

69XUUnpaid employment expenditure

  1. Sections DC 11(2) and (3) and EA 4(6) of the Income Tax Act 2007 apply to any amount of employment income (as that term is defined in the Income Tax Act 2007) that a Chorus company assumes the obligation to pay in connection with the vesting. For the purposes of those sections, the Chorus company is treated as person B, and the relevant Telecom company that incurred the obligation to pay is treated as person A.

Notes
  • Section 69XU: inserted, on (being the date of separation day, and an Order in Council (SR 2011/302) having been made under section 36), by section 51 of the Telecommunications (TSO, Broadband, and Other Matters) Amendment Act 2011 (2011 No 27).