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Income Tax Act 2007

Timing and quantifying rules - Terminating provisions - Definitions

EZ 44: Relationship with rest of Act

You could also call this:

“How old financial arrangements rules work with other parts of the Act”

This part of the law explains how the old financial arrangements rules work with the rest of the Income Tax Act 2007.

If you have income or expenses in a year from a financial arrangement under the old rules, you need to calculate them using those old rules, even if other parts of the Act say something different.

When you spend money under the old financial arrangements rules, you can’t include it in the cost of certain things. These things include trading stock for small taxpayers, revenue account property, livestock, bloodstock, film or film rights, film production, timber, and petroleum exploration or development.

If you transfer property as part of a financial arrangement, and that property or what you got for it matters for working out your income or deductions under other parts of the Act, you need to treat it as if it was transferred for its acquisition price.

Remember, these rules are specific to the old financial arrangements, so they might not apply to newer arrangements you make.

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View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=DLM1516131.

Topics:
Money and consumer rights > Taxes
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EZ 43: Variable principal debt instruments, or

“Rules for handling debt instruments with changing principal amounts on a specific date”

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EZ 45: Application of old financial arrangements rules, or

“When old financial arrangements rules don't apply”

Part E Timing and quantifying rules
Terminating provisions: Definitions

EZ 44Relationship with rest of Act

  1. Notwithstanding any other provision in this Act, income or expenditure in an income year in respect of a financial arrangement under the old financial arrangements rules is calculated under those rules.

  2. Expenditure incurred under the old financial arrangements rules is not included in—

  3. the cost of trading stock, for small taxpayers:
    1. the cost of revenue account property:
      1. the cost of livestock:
        1. the cost of bloodstock:
          1. the cost of acquiring a film or a film right:
            1. film production expenditure:
              1. the cost of timber:
                1. petroleum exploration expenditure or petroleum development expenditure.

                  1. Where—

                  2. property is transferred under a financial arrangement; and
                    1. the property or the consideration given for the property is relevant under any provision of this Act other than the old financial arrangements rules for the purpose of determining any amount of income or deduction of a person,—
                        1. the property is treated for the purpose of that provision as having been transferred under the financial arrangement for an amount equal to the acquisition price of the property.

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