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Income Tax Act 2007

Timing and quantifying rules - Terminating provisions

EZ 6: Reduction: broodmare previously used for breeding in New Zealand: pre-1 August 2006

You could also call this:

"Reducing the value of a female horse used for breeding in New Zealand before 1 August 2006"

Illustration for Income Tax Act 2007

This law is about broodmares, which are female horses used for breeding. You need to know if the horse was used for breeding in New Zealand before 1 August 2006. The law applies to you if you have a broodmare that meets certain conditions.

The value of your broodmare is reduced using a formula. The formula is the cost price of the broodmare divided by a number. This number is 15 minus the age of the broodmare, or 11 minus the age of the broodmare, depending on the situation.

The age of the broodmare is either its actual age or a certain number of years. For example, if the broodmare is 11 years old or less, its age is used in the formula. If the broodmare is 12 years old or more, its age is considered to be 12 years for the formula. The same rules apply if the number is 11 or 8, depending on the situation.

You can find more information about this law in section EC 39 and section EC 40. These sections are about bloodstock, which includes horses like broodmares. You can also look at section EC 41 and EZ 5 for more information.

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View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=DLM1515999.

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EZ 5: Reduction: bloodstock not previously used for breeding in New Zealand: pre-1 August 2006, or

"Reducing the value of horses not used for breeding in New Zealand before August 2006"

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EZ 6B: National minimum price threshold for 2019 calendar year, or

"Minimum prices for buying different types of young racehorses in 2019"

Part ETiming and quantifying rules
Terminating provisions

EZ 6Reduction: broodmare previously used for breeding in New Zealand: pre-1 August 2006

  1. This section applies to a broodmare that section EC 39(1) or (2) (First income year in breeding business) applies to,—

  2. before 1 August 2006; or
    1. for an income year ending on or after 1 August 2006, if a requirement of paragraphs (a) to (c) of section EC 39(1) or (2) is first met before 1 August 2006.

      1. For the purposes of sections EC 39 and EC 40 (which relate to bloodstock), the reduction applying to the value of a broodmare to which section EC 39(1) applies and sections EC 41 (Reduction: bloodstock not previously used for breeding in New Zealand) and EZ 5 do not apply is calculated using the formula—

        cost price of broodmare ÷ (15 − age of broodmare).

        Where:

        • In the formula in subsection (2), age of broodmare is—

        • 12 years of age; or
          1. the actual age in years, if the broodmare is 11 years of age or less at the end of the income year.

            1. For the purposes of sections EC 39 and EC 40, the reduction applying to the value of a broodmare to which section EC 39(2) applies and sections EC 41 and EZ 5 do not apply is calculated using the formula—

              cost price of broodmare ÷ (11 − age of broodmare).

              Where:

              • In the formula in subsection (4), age of broodmare is—

              • 8 years of age; or
                1. the actual age in years, if the broodmare is 7 years of age or less at the end of the income year.

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