Plain language law

New Zealand law explained for everyone

Income Tax Act 2007

Recharacterisation of certain transactions - Consolidated groups of companies - Nominated companies

FM 34: Nominated companies

You could also call this:

“How a company is chosen to represent a group of companies for tax purposes”

When companies join together in a group called a consolidated group, they must choose one company to be their nominated company. This nominated company must be part of the group.

The nominated company acts as the representative for the whole group and all the companies in it. It does this for things related to tax laws.

If the nominated company wants to stop being the representative, it can tell the tax office (the Commissioner) that it’s stepping down. It also needs to say which company will take over as the new nominated company. This change happens either when the tax office gets the message or on a later date if the company says so.

Sometimes, the nominated company might close down completely. If this happens, the other companies in the group can pick a new nominated company. The new company becomes the representative from the day the old one closed down. They need to tell the tax office about this within 20 working days, or longer if the tax office agrees.

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View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=DLM1516722.

Topics:
Money and consumer rights > Taxes
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FM 33: When membership is reduced, or

“What happens when a consolidated group loses members”

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FM 35: Forming consolidated group, or

“How to create a group of companies for tax purposes”

Part F Recharacterisation of certain transactions
Consolidated groups of companies: Nominated companies

FM 34Nominated companies

  1. The nominated company of a consolidated group at any time must be in the consolidated group at the time.

  2. For the purposes of this Act and the Tax Administration Act 1994, a nominated company of a consolidated group is, at a time, the agent of the consolidated group and of each company that is in the consolidated group at the time.

  3. A nominated company may notify the Commissioner that it is, at a particular date, no longer to continue as the agent for the consolidated group, and that another company is to become the nominated company for the consolidated group.

  4. A notice referred to in subsection (3) takes effect—

  5. on the date the Commissioner receives the notice; or
    1. on a later date set out in the notice.

      1. If the nominated company of a consolidated group is liquidated, the other companies in the consolidated group may choose a replacement. The replacement company—

      2. becomes the nominated company of the consolidated group from the date of liquidation; and
        1. must notify the Commissioner of its selection as nominated company within 20 working days after the date of liquidation, or a longer period if the Commissioner agrees.

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