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Income Tax Act 2007

Recharacterisation of certain transactions - Imputation groups of companies

FN 7: Forming imputation groups

You could also call this:

“How companies can group together for tax purposes”

If you are a company, you can form an imputation group with other companies. To do this, you need to be part of a group where one company owns all the other companies completely. You also need to meet the requirements in section FN 4.

When you decide to form an imputation group, you must tell the Commissioner about it. In your message to the Commissioner, you need to choose one company from your group to be in charge. This company is called the nominated company.

If you’re already part of a consolidated group (which is a special kind of company group), the nominated company can tell the Commissioner that all the companies in your group want to either:

  1. Form an imputation group with other eligible companies that aren’t in your consolidated group, or
  2. Join an imputation group that already exists.

When you tell the Commissioner about forming or joining an imputation group, it will start from the beginning of the tax year in which the Commissioner gets your message.

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View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=DLM1516758.

Topics:
Money and consumer rights > Taxes
Business > Industry rules
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FN 6: Nominated companies, or

“Rules for the company that represents an imputation group”

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FN 8: Trans-Tasman imputation groups and resident imputation subgroups, or

“Rules for tax groups with both Australian and New Zealand companies”

Part F Recharacterisation of certain transactions
Imputation groups of companies

FN 7Forming imputation groups

  1. Two or more companies may choose to form an imputation group of companies if the companies are, at the time,—

  2. a wholly-owned group of companies; and
    1. eligible under section FN 4.

      1. The Commissioner must be notified of an election under subsection (1).

      2. A notice under subsection (2) must nominate 1 of the companies in the imputation group as its agent for the purposes of the imputation rules. In this subpart, the company is called the nominated company.

      3. A nominated company of a consolidated group may notify the Commissioner that, having met the eligibility criteria in section FN 4, all the group companies have chosen—

      4. to form an imputation group with eligible companies that are not part of the consolidated group; or
        1. to join an existing imputation group.

          1. A notice under subsection (1) or (4) has effect from the start of the tax year in which the Commissioner receives the notice.

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