Plain language law

New Zealand law explained for everyone

Income Tax Act 2007

Recharacterisation of certain transactions - Transfers of relationship property

FB 14: Specified livestock

You could also call this:

"Rules for transferring livestock in a relationship settlement"

Illustration for Income Tax Act 2007

When you transfer specified livestock as part of a relationship property settlement, this section applies. You must have used the livestock for a business other than selling livestock and had the livestock at the start of the year you transferred it. The value of the livestock must not be determined under the herd scheme, see section FB 15. When you transfer the livestock, it is treated as if you sold and bought it for a certain amount. This amount is the value you worked out under subpart EC and used in section EA 1 for the year before the transfer. This section is more important than sections GC 1 and GC 2, which are about selling trading stock for too little money.

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 It might be out of date or be missing some parts.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

View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=DLM1516355.

This page was last updated on — View changes

Topics:
Money and consumer rights > TaxesFamily and relationships > Marriage and partnershipsBusiness > Industry rules
Previous

FB 13: Trading stock, or

"What happens to taxes when you transfer trading stock during a relationship property settlement"

Next

FB 15: Specified livestock valued under herd scheme, or

"Valuing livestock when settling relationship property"

Part FRecharacterisation of certain transactions
Transfers of relationship property

FB 14Specified livestock

  1. This section applies for the purposes of sections EC 6 to EC 26 (which relate to the valuation of specified livestock) when—

  2. specified livestock is transferred on a settlement of relationship property; and
    1. the transferor used the livestock in the carrying on of a business other than a business of dealing in livestock, and held the livestock at the start of the year of transfer; and
      1. the value of the livestock is not determined under the herd scheme, see section FB 15.

        1. The transfer is treated as a disposal and acquisition for an amount equal to the value that the transferor determined under subpart EC (Valuation of livestock) and took into account in section EA 1 (Trading stock, livestock, and excepted financial arrangements) at the end of the income year before the year of transfer.

        2. This section overrides sections GC 1 and GC 2 (which relate to the disposal of trading stock for inadequate consideration).

        Compare