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New Zealand law explained for everyone

Income Tax Act 2007

Tax credits and other credits - Tax credits relating to attributed controlled foreign company income

LK 12: Treatment of credits when companies amalgamate

You could also call this:

“How tax credits are handled when companies combine”

When companies join together, you need to think about what happens to their tax credits. The law says that when figuring out if a tax credit can still be used or if certain rules are met, you should treat the new, joined company as if it were the old company. This means the new company is seen as having the same people owning shares and options to buy shares as the old company did. This rule helps to make sure that tax credits aren’t lost just because companies have joined together.

If you want to know more about the specific rules for using tax credits, you can look at section LK 5. For information about other requirements related to tax credits, you can check section LK 6.

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View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=DLM1518181.

Topics:
Money and consumer rights > Taxes
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LK 11: When group membership lacking in tax year in which credit used, or

“Rules for using tax credits when a company isn't in a group for the whole year”

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LK 13: Use of credits by amalgamated company, or

“Unused tax credits can be transferred when companies merge”

Part L Tax credits and other credits
Tax credits relating to attributed controlled foreign company income

LK 12Treatment of credits when companies amalgamate

  1. On an amalgamation, for the purposes of determining whether a credit carried forward is available under section LK 5 or whether the requirements of section LK 6 are met, the amalgamated company is treated as if it were the amalgamating company with the same holders of shares and options over shares.

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