Plain language law

New Zealand law explained for everyone

Income Tax Act 2007

Income - Terminating provisions

CZ 12: General insurance with risk period straddling 1 July 1993

You could also call this:

“Rules for certain reinsurance claims spanning 1 July 1993”

If you have a company that provides general insurance or guarantees against loss, damage, or risk, this law might apply to you. It’s about what happens with certain reinsurance contracts that cover risks across 1 July 1993.

Here’s what you need to know:

Your company must have been providing insurance or guarantees just before and on 1 July 1993. You also need to have a reinsurance contract that covers risks starting before 1 July 1993 and ending after that date. Lastly, you must have paid the premiums for this contract outside of New Zealand.

If all of these things are true, then here’s what happens:

If something happens on or after 1 July 1993 that makes you claim on your reinsurance contract, any money you get from that claim counts as income for your company. This income is counted in the tax year when the event that led to the claim happened.

This text is automatically generated. It might be out of date or be missing some parts. Find out more about how we do this.

View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=DLM1513528.

Topics:
Money and consumer rights > Taxes
Business > Industry rules
Previous

CZ 11: Recovery of deductions for software acquired before 1 April 1993, or

“Rules for taxing money from selling old software you got tax breaks for”

Next

CZ 13: Treatment of units and interests in unit trusts and group investment funds on issue as at 1 April 1996, or

“How units and interests in certain investments were treated from 1 April 1996”

Part C Income
Terminating provisions

CZ 12General insurance with risk period straddling 1 July 1993

  1. This section applies when—

  2. a company carries on a business of providing general insurance or guarantees against loss, damage, or risk, immediately before and on 1 July 1993; and
    1. the company holds a reinsurance contract for the general insurance that covers a period of risk starting before 1 July 1993 and ending after 1 July 1993; and
      1. the company pays the premiums under the contract outside New Zealand.

        1. An amount derived by the company from a claim under the reinsurance contract is income of the company if the event giving rise to the claim occurs on or after 1 July 1993.

        2. The income is allocated to the income year in which the event giving rise to the claim occurs.

        Compare