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Income Tax Act 2007

Deductions - Expenditure specific to certain entities

DV 18: Statutory producer boards and co-operative companies

You could also call this:

“Special tax rules for money given out by producer boards and co-operative companies”

This law is about special rules for producer boards and co-operative companies when they give out money. If these organisations choose to call their money distributions ‘dividends’, some special rules apply.

When a producer board or co-operative company gives out money and calls it a dividend, they can’t claim it as a business expense. This means they can’t use it to reduce the amount of tax they need to pay.

This rule is very strict. Even if the organisation would normally be allowed to claim the expense, this rule says they can’t do it in this case.

The law mentions some other sections (OB 73, OB 78, and OB 78B) that talk about tax credits for these kinds of payments. These sections explain more about how these dividends work with the tax system.

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View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=DLM1514179.

Topics:
Money and consumer rights > Taxes
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Part D Deductions
Expenditure specific to certain entities

DV 18Statutory producer boards and co-operative companies

  1. This section applies for the purposes of sections OB 73, OB 78, and OB 78B (which relate to imputation credits attached to cash distributions by statutory producer boards and co-operative companies) when a producer board or co-operative company chooses to treat a distribution as a dividend.

  2. The producer board or co-operative company making the distribution is denied a deduction for the amount of the distribution.

  3. This section overrides the general permission.

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Notes
  • Section DV 18(1): amended, on , by section 60 of the Taxation (Annual Rates for 2019–20, GST Offshore Supplier Registration, and Remedial Matters) Act 2019 (2019 No 33).