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Income Tax Act 2007

Taxation of certain entities - Joint venturers, partners, and partnerships

HG 3: General provisions relating to disposals

You could also call this:

“Rules for selling things in partnerships and how they affect your taxes”

If you want to know about how tax works for certain groups, there are some rules about selling things. These rules are part of a bigger law called the Income Tax Act 2007.

Section HG 4 is more important than sections HG 5 to HG 10. This means you should look at HG 4 first.

If you’re part of a small partnership, you might not have to follow sections HG 5 to HG 9. This only happens if you, your partners, and the partnership all agree to ignore these rules when you report your income.

If you’re a new partner joining a partnership, you can choose to follow section HG 10. You do this by including it in your income report.

Remember, these rules are about how to handle money and taxes when people join or leave a partnership. It’s important to follow them correctly when you’re doing your taxes.

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View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=DLM1185061.

Topics:
Money and consumer rights > Taxes
Business > Industry rules
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“ Partnerships are treated as see-through for tax purposes ”

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HG 4: Disposal upon final dissolution, or

“Final dissolution of partnerships: tax treatment of partners' interests”

Part H Taxation of certain entities
Joint venturers, partners, and partnerships

HG 3General provisions relating to disposals

  1. Section HG 4 overrides sections HG 5 to HG 10.

  2. Sections HG 5 to HG 9 do not apply for the partners of a small partnership if the entering partner, the exiting partner, and the partnership, furnish returns of income that ignore the sections.

  3. Section HG 10 applies for an entering partner if the entering partner furnishes a return of income that applies the section.

Notes
  • Section HG 3: inserted, on , by section 19(1) of the Taxation (Limited Partnerships) Act 2008 (2008 No 2).
  • Section HG 3(2): amended (with effect on 1 April 2008), on , by section 269(1) of the Taxation (International Taxation, Life Insurance, and Remedial Matters) Act 2009 (2009 No 34).
  • Section HG 3(3) heading: substituted (with effect on 1 April 2008), on , by section 269(2) of the Taxation (International Taxation, Life Insurance, and Remedial Matters) Act 2009 (2009 No 34).
  • Section HG 3(3): substituted (with effect on 1 April 2008), on , by section 269(2) of the Taxation (International Taxation, Life Insurance, and Remedial Matters) Act 2009 (2009 No 34).
  • Section HG 3 list of defined terms entering partner: inserted (with effect on 1 April 2008), on , by section 62 of the Taxation (Livestock Valuation, Assets Expenditure, and Remedial Matters) Act 2013 (2013 No 52).
  • Section HG 3 list of defined terms exiting partner: repealed, on , by section 243 of the Taxation (Annual Rates for 2015–16, Research and Development, and Remedial Matters) Act 2016 (2016 No 1).
  • Section HG 3 list of defined terms partner: inserted (with effect on 1 April 2008), on , by section 62 of the Taxation (Livestock Valuation, Assets Expenditure, and Remedial Matters) Act 2013 (2013 No 52).
  • Section HG 3 list of defined terms partnership: inserted (with effect on 1 April 2008), on , by section 62 of the Taxation (Livestock Valuation, Assets Expenditure, and Remedial Matters) Act 2013 (2013 No 52).
  • Section HG 3 list of defined terms return of income: inserted (with effect on 1 April 2008), on , by section 62 of the Taxation (Livestock Valuation, Assets Expenditure, and Remedial Matters) Act 2013 (2013 No 52).
  • Section HG 3 list of defined terms small partnership: inserted (with effect on 1 April 2008), on , by section 62 of the Taxation (Livestock Valuation, Assets Expenditure, and Remedial Matters) Act 2013 (2013 No 52).