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New Zealand law explained for everyone

Income Tax Act 2007

Income - Terminating provisions

CZ 5: Exempt interest: overseas money lent to government or local or public authority before 29 July 1983

You could also call this:

“Tax-free interest on certain overseas loans to NZ government before 29 July 1983”

You don’t have to pay income tax on some money you get from overseas if it meets certain conditions. This applies to two types of situations:

  1. If you’re not living in New Zealand and you get money from stocks or debentures that the New Zealand government, a local authority, or a public authority issued before 29 July 1983. The interest on these must be paid from outside New Zealand.

  2. If you’re not living in New Zealand and you get money from loans that were made before 29 July 1983. These loans must have an agreement with the New Zealand government that says the interest doesn’t need to be taxed in New Zealand.

There’s also a special rule about loans. If you made a loan on or after 29 July 1983, it can still count as being made before that date. This happens if you asked the New Zealand government for the tax exemption before 29 July 1983, even if you didn’t get an answer right away.

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View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=DLM1513506.

Topics:
Money and consumer rights > Taxes
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“Old rule about mining company loans made before April 1979 no longer applies”

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CZ 6: Commercial bills before 31 July 1986, or

“Rules for income from commercial bills issued before 31 July 1986”

Part C Income
Terminating provisions

CZ 5Exempt interest: overseas money lent to government or local or public authority before 29 July 1983

  1. Amounts that a non-resident derives are exempt income if they are derived from—

  2. stock or debentures issued before 29 July 1983 by the government of New Zealand or by a local authority or a public authority, the interest on which is payable out of New Zealand; or
    1. loans entered into before 29 July 1983, the interest on which was to be exempt from income tax in New Zealand under an agreement or arrangement made with the government of New Zealand.

      1. For the purposes of subsection (1)(b), a loan entered into on or after 29 July 1983 is treated as having been entered into before that date if an exemption of a kind referred to in that provision was authorised as a result of an application received by or posted to the government of New Zealand before 29 July 1983.

      Compare
      Notes
      • Section CZ 5 list of defined terms apply: inserted, on , by section 74 of the Taxation (Transformation: First Phase Simplification and Other Measures) Act 2016 (2016 No 27).