Plain language law

New Zealand law explained for everyone

 Plain Language Law homepage
Back to
DZ 1: Commercial bills before 31 July 1986
or “Tax deductions for commercial bills purchased before 31 July 1986”
You could also call this:

“Tax rules for life insurers selling property bought before April 1988”

If you are a life insurance company that started business on or before the end of the 1988-89 income year, this law might apply to you. It’s about property you bought before 1 April 1988 and later sold.

You can get a tax deduction if your Life Insurance Fund covered things like superannuation policies, some mortgage insurance policies, or annuities at the end of the 1987-88 income year. This deduction applies when you sell the property, but only if you haven’t already claimed a deduction for it before (except for depreciation or under some financial rules).

The amount you can deduct is explained in section EZ 1.

A superannuation policy, in this case, means a life insurance policy that’s part of certain superannuation funds that existed before 17 December 1987. It doesn’t include personal pension schemes that let new members join after that date.

This law overrides rules about capital, but you still need to follow other tax rules.

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 It might be out of date or be missing some parts.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

Next up: DZ 3: Petroleum mining: development expenditure from 1 October 1990 to 15 December 1991

or “Petroleum miners can claim expenses for development between 1 October 1990 and 15 December 1991”
Next

Part D Deductions
Terminating provisions

DZ 2Life insurers acquiring property before 1 April 1988

  1. This section applies when—

  2. a life insurer started carrying on the business of providing life insurance on or before the last day of the 1988–89 income year; and
    1. on the last day of the 1987–88 income year the life insurer’s Life Insurance Fund covered some or all of the following matters:
      1. superannuation policies; and
        1. pre-1983 mortgage repayment insurance policies; and
          1. annuities that had been granted; and
          2. the life insurer, as part of the business, acquired property before 1 April 1988; and
            1. the life insurer, as part of the business, disposes of the property; and
              1. either—
                1. the life insurer has not already been allowed a deduction for the property, whether under section DR 2 (Disposal of property) or any other provision; or
                  1. the life insurer has been allowed a deduction for the property, but only for an amount of depreciation loss or because of the application of the old financial arrangements rules or the financial arrangements rules; and
                  2. section DR 2 does not apply to the disposal.

                    1. The life insurer is allowed a deduction for the amount quantified in section EZ 1 (Life insurers acquiring property before 1 April 1988).

                    2. Superannuation policy means a life insurance policy—

                    3. that—
                      1. is vested in a superannuation fund that was or was treated as being a superannuation category 1 scheme on or before 17 December 1987, not including a scheme that was classified by the Government Actuary as a personal pension superannuation scheme and that admitted new members after 17 December 1987; or
                        1. was effected for the purposes of any such superannuation fund; or
                          1. was accepted by any such superannuation fund for the purposes of the fund; and
                          2. that has not ceased to be a policy for the purposes of the superannuation fund.

                            1. This section overrides the capital limitation. The general permission must still be satisfied and the other general limitations still apply.

                            Compare