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Income Tax Act 2007

Treatment of tax losses - Grouping tax losses

IC 9: Date for payment and notice to Commissioner

You could also call this:

“When to pay and notify about company tax losses”

If you’re a company dealing with tax losses, you need to know about payments and notices related to these losses. Here’s what you need to remember:

When you make a payment related to tax losses, you must do it by the extended return date. This date is usually 31 March, which is the latest day you can file your tax return for that year. Sometimes, the Commissioner might let you pay later.

You also need to tell the Commissioner about any choices or payments you make about tax losses. You should do this by the extended return date too. If the Commissioner agrees, you might be able to tell them later. You can include this information in your yearly tax return.

If you’re part of a group of companies and you’re using a tax loss from another company in your group, the rules might be a bit different. In this case, the extended return date depends on when the other company’s loss happened.

Remember, it’s important to follow these rules to make sure you’re doing everything right with your taxes.

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View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=DLM1517739.

Topics:
Money and consumer rights > Taxes
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“Limits on how much tax loss one company can use to help another”

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IC 10: When companies have different balance dates, or

“Rules for sharing tax losses between companies with different financial year-ends”

Part I Treatment of tax losses
Grouping tax losses

IC 9Date for payment and notice to Commissioner

  1. A payment under section IC 5(2)(b) must be made no later than the extended return date, or by a later date if the Commissioner allows.

  2. Company A must notify the Commissioner of an election or payment under section IC 5(2) by the extended return date or, if applicable, a later date allowed by the Commissioner for the notice. The notification may be made in the company’s annual return of income.

  3. In subsections (1) and (2), extended return date means the 31 March that, for company A and the tax year in which the amount of the tax loss is subtracted, is the latest date to which the time for providing the return of income may be extended under section 37(5) of the Tax Administration Act 1994.

  4. Despite subsection (3), for a company that is a member of a group of companies and a tax year in which the company uses a tax loss that arises from an election by another group member under section IZ 8 (Election to use net loss for 2019–20 or 2020–21 year as tax loss in preceding year) and is made available by the other group member, the extended return date is determined using the tax year in which the net loss affected by the election arises for the other group member.

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Notes
  • Section IC 9(2): amended (with effect on 1 April 2008 and applying for the 2008–09 and later income years), on , by section 150(1) of the Taxation (Annual Rates for 2016–17, Closely Held Companies, and Remedial Matters) Act 2017 (2017 No 14).
  • Section IC 9(4) heading: inserted (with effect on 15 April 2020), on , by section 9(1) of the COVID-19 Response (Taxation and Other Regulatory Urgent Measures) Act 2020 (2020 No 10).
  • Section IC 9(4): inserted (with effect on 15 April 2020), on , by section 9(1) of the COVID-19 Response (Taxation and Other Regulatory Urgent Measures) Act 2020 (2020 No 10).
  • Section IC 9 list of defined terms group of companies: inserted (with effect on 15 April 2020), on , by section 9(2) of the COVID-19 Response (Taxation and Other Regulatory Urgent Measures) Act 2020 (2020 No 10).
  • Section IC 9 list of defined terms net loss: inserted (with effect on 15 April 2020), on , by section 9(2) of the COVID-19 Response (Taxation and Other Regulatory Urgent Measures) Act 2020 (2020 No 10).
  • Section IC 9 list of defined terms notice: inserted, on , by section 74 of the Taxation (Transformation: First Phase Simplification and Other Measures) Act 2016 (2016 No 27).