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CR 2: Shareholder base income of life insurer
or “Life insurer must include certain funds as shareholder income”
You could also call this:

“How premiums paid to overseas insurers are taxed in New Zealand”

This section applies to insurance premiums that are considered to have a source in New Zealand. It affects you if you pay a premium to an insurer for certain types of insurance, and the premium meets specific conditions.

The types of insurance this covers are general insurance and certain guarantees against risk. For guarantees, it applies if you’re associated with the insurer or if the guarantee is related to money you’ve borrowed.

If you’re an insurer who isn’t living in New Zealand when you receive the premium, and the premium isn’t connected to a fixed place of business you have in New Zealand, this section might affect you. It also applies if the person paying the premium lives in New Zealand, if the insurance contract was offered or signed in New Zealand, or if it’s for a business run in New Zealand.

For insurers affected by this section, 10% of the total premium you receive is counted as your income.

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Next up: CR 3B: Lloyd’s of London: income from life insurance premiums

or “New Zealand tax on Lloyd's of London life insurance premiums”
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Part C Income
Income from insurance

CR 3Income of non-resident general insurer

  1. This section applies to a premium that is treated as having a source in New Zealand under section YD 8 (Apportionment of premiums derived by non-resident general insurers) if—

  2. an insured person pays the premium to an insurer for insurance of any of the kinds described in subsection (3); and
    1. the premium meets all 3 conditions in subsection (4); and
      1. the premium is not excluded from the application of this section by section YD 8(6).

        1. Ten percent of the gross premium derived by the insurer is income of the insurer.

        2. The kinds of insurance referred to in subsection (1)(a) are—

        3. general insurance:
          1. a guarantee against risk given by an insurer to an insured person if—
            1. the insured person is liable to pay a premium to the insurer for the guarantee; and
              1. the insured person is associated with the insurer:
              2. a guarantee against risk given by an insurer to an insured person if—
                1. the insured person is liable to pay a premium to the insurer for the guarantee; and
                  1. the risk arises from money lent to the insured person; and
                    1. the amounts the insured person is liable to pay for the money are significantly less than they would otherwise have been because of the guarantee; and
                      1. the effect of the guarantee on the amounts payable is more than an incidental effect, or comes about as more than an incidental purpose, of the insurer’s giving the guarantee.

                      2. The premium referred to in subsection (1)(b) is—

                      3. a premium derived by an insurer who is not resident in New Zealand when they derive it:
                        1. a premium that is not attributable to a fixed establishment of the insurer in New Zealand through which they carry on business in New Zealand:
                          1. a premium to which at least 1 of the following applies:
                            1. the insured person from whom the premium is derived is resident in New Zealand; or
                              1. the insurance contract from which the premium is derived is offered or entered into in New Zealand; or
                                1. the insurance contract from which the premium is derived is entered into for the purposes of a business carried on by the insured person in New Zealand through a fixed establishment in New Zealand.

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                                Notes
                                • Section CR 3(1): amended, on , by section 32(1) of the Taxation (GST and Remedial Matters) Act 2010 (2010 No 130).
                                • Section CR 3 list of defined terms derived from New Zealand: repealed, on , by section 32(2)(a) of the Taxation (GST and Remedial Matters) Act 2010 (2010 No 130).
                                • Section CR 3 list of defined terms source in New Zealand: inserted, on , by section 32(2)(b) of the Taxation (GST and Remedial Matters) Act 2010 (2010 No 130).