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Income Tax Act 2007

Timing and quantifying rules - Financial arrangements rules

EW 6: Relationship between financial arrangements and excepted financial arrangements

You could also call this:

“How special financial agreements fit within larger financial arrangements”

Sometimes, a special type of financial agreement called an ‘excepted financial arrangement’ can be part of a bigger financial arrangement. Here’s what you need to know about how they work together:

If the excepted financial arrangement is one of the types mentioned in section EW 5(2) to (16), any money that comes only from that part doesn’t count under the financial arrangement rules.

But if the excepted financial arrangement is one of the types mentioned in section EW 5(17) to (25), any money that comes only from that part does count under the financial arrangement rules.

If you’re not sure whether money is only from an excepted financial arrangement, you can ask the Commissioner for help. They can make a special decision called a ‘binding ruling’ to explain how the tax law applies to your situation.

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View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=DLM1515245.

Topics:
Money and consumer rights > Taxes
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EW 5: What is an excepted financial arrangement?, or

“Certain financial arrangements treated differently for tax purposes”

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EW 7: Change from private or domestic purpose, or

“Changing how you use a personal money agreement”

Part E Timing and quantifying rules
Financial arrangements rules

EW 6Relationship between financial arrangements and excepted financial arrangements

  1. An excepted financial arrangement may be part of a financial arrangement.

  2. If an excepted financial arrangement described in any of section EW 5(2) to (16) is part of a financial arrangement, an amount solely attributable to the excepted financial arrangement is not an amount taken into account under the financial arrangements rules.

  3. If an excepted financial arrangement described in any of section EW 5(17) to (25) is part of a financial arrangement, an amount solely attributable to the excepted financial arrangement is an amount taken into account under the financial arrangements rules.

  4. The Commissioner may make a binding ruling under section 91CC(1)(a) of the Tax Administration Act 1994 on how a taxation law applies, or would apply, to a person and an arrangement on whether an amount is solely attributable to an excepted financial arrangement.

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Notes
  • Section EW 6(4) heading: inserted, on , by section 175(1) of the Taxation (Annual Rates for 2018–19, Modernising Tax Administration, and Remedial Matters) Act 2019 (2019 No 5).
  • Section EW 6(4): inserted, on , by section 175(1) of the Taxation (Annual Rates for 2018–19, Modernising Tax Administration, and Remedial Matters) Act 2019 (2019 No 5).
  • Section EW 6 list of defined terms binding ruling: inserted, on , by section 175(2) of the Taxation (Annual Rates for 2018–19, Modernising Tax Administration, and Remedial Matters) Act 2019 (2019 No 5).