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Income Tax Act 2007

Timing and quantifying rules - Life insurance rules - Non-participation policies

EY 20: Shareholder base allowable deductions: non-participation policies

You could also call this:

“Allowable expenses for life insurers' non-participating policies”

You can deduct certain expenses from your shareholder base income for life insurance policies that are not profit participation policies. These deductions can include:

The life risk parts of premiums and claims, but not for annuities, unless they’re described in the other points below.

Fees and commissions you pay.

The life risk part of life reinsurance premiums.

Expenses related to investment income, as long as they’re not already deducted from your policyholder base income.

Premium payback amounts, but only if the original premium was included as shareholder base income and wasn’t part of a transitional amount calculation.

Any other expenses not covered elsewhere in this part of the law for that income year.

If you’ve already claimed a deduction under sections EY 23 to EY 27, you can’t claim it again under this section.

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View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=DLM1515840.

Topics:
Money and consumer rights > Taxes
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EY 19B: Shareholder base income: consideration credited for investment management services, or

“Life insurers' income from managing non-profit participation savings policies”

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EY 21: Shareholder base income: profit participation policies, or

“Income for shareholders from certain life insurance policies”

Part E Timing and quantifying rules
Life insurance rules: Non-participation policies

EY 20Shareholder base allowable deductions: non-participation policies

  1. For an income year, a life insurer's deduction is included as their shareholder base allowable deduction if it relates to life insurance policies that are not profit participation policies, and it—

  2. relates to life risk components of premiums and claims, other than for annuities, and is not described in paragraphs (b) to (e):
    1. relates to fees and commissions:
      1. relates to the life risk component of life reinsurance premiums:
        1. is a deduction that—
          1. relates to income that is included in the item investment in the formula in section EY 15(2) or meets the requirements of section EY 19(1)(db); and
            1. is not included in the life insurer's policyholder base allowable deduction under section EY 16:
            2. is a premium payback amount, and—
              1. section EY 19 applies or has applied to include the original premium as shareholder base income; and
                1. section EY 30(7) does not apply or has not applied to calculate a transitional amount for the original premium:
                2. is not otherwise accounted for in this subpart, for the income year.

                  1. If an amount is included as shareholder base allowable deduction under sections EY 23 to EY 27, it is not included under this section.

                  Notes
                  • Section EY 20: substituted, on , by section 190(1) of the Taxation (International Taxation, Life Insurance, and Remedial Matters) Act 2009 (2009 No 34).
                  • Section EY 20(1)(d): replaced (with effect on 1 July 2010), on , by section 62(1) of the Taxation (Annual Rates, Foreign Superannuation, and Remedial Matters) Act 2014 (2014 No 4).
                  • Section EY 20(2): amended, on , by section 62(2) of the Taxation (Annual Rates, Foreign Superannuation, and Remedial Matters) Act 2014 (2014 No 4).