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Income Tax Act 2007

Tax credits and other credits - Tax credits for multi-rate PIEs and investors

LS 1: Tax credits for multi-rate PIEs

You could also call this:

“Tax credits available for certain multi-rate PIEs and their investors”

If you’re a multi-rate PIE, you can get a tax credit for a tax year. The amount of the tax credit is decided in different ways. It can be for imputation credits or tax that’s been paid or held back. It can also be for tax losses that investors have.

But there are some cases where you can’t get this tax credit. You can’t get it for zero-rated investors or for investors who are leaving and are treated as zero-rated. You also can’t get it for foreign investors in a foreign investment PIE for imputation credits on dividends the PIE got. And if you pay tax using the provisional tax calculation option, you can’t get this credit either.

The amount of the tax credit is the same as what’s worked out in the relevant section of the law. You get the tax credit for the tax year when the calculation period happens.

If you work out your income tax using the exit calculation option, the amount of a credit for an investor can be used to pay a tax bill related to that investor.

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View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=DLM1518352.

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LS 2: Tax credits for investors in multi-rate PIEs, or

“Investors in certain funds can receive tax credits to offset their income tax”

Part L Tax credits and other credits
Tax credits for multi-rate PIEs and investors

LS 1Tax credits for multi-rate PIEs

  1. A multi-rate PIE has a tax credit for a tax year for the amount determined—

  2. under sections HM 51 and HM 53 (which relate to certain tax credits) for an imputation credit or a credit for tax paid or withheld:
    1. under section HM 55 (Tax credits for losses) arising from a tax loss attributed to an investor.

      1. This section does not apply—

      2. in relation to—
        1. a zero-rated investor:
          1. an exiting investor who is treated under section HM 61 (Certain exiting investors zero-rated) as zero-rated:
            1. a notified foreign investor in a foreign investment PIE in relation to an imputation credit attached to a dividend derived by the PIE:
            2. if the PIE pays tax using the provisional tax calculation option under section HM 44 (Provisional tax calculation option).

              1. The amount of the tax credit equals the amount determined under the relevant section.

              2. The PIE has the tax credit for the tax year in which the relevant calculation period falls.

              3. If the PIE calculates its income tax liability using the exit calculation option under section HM 42 (Exit calculation option), the amount of a credit attributable to an investor is able to be used to satisfy a tax obligation relating to the investor.

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              Notes
              • Section LS 1: substituted, on (applying for the 2010–11 and later income years), by section 348(1) of the Taxation (International Taxation, Life Insurance, and Remedial Matters) Act 2009 (2009 No 34).
              • Section LS 1(2)(a)(iii): added, on (applying for the 2012–13 and later income years for a foreign investment variable-rate PIE and a notified foreign investor in the PIE), by section 105(1) of the Taxation (Tax Administration and Remedial Matters) Act 2011 (2011 No 63).
              • Section LS 1 list of defined terms foreign investment PIE: inserted, on , by section 105(2) of the Taxation (Tax Administration and Remedial Matters) Act 2011 (2011 No 63).
              • Section LS 1 list of defined terms notified foreign investor: inserted, on , by section 105(2) of the Taxation (Tax Administration and Remedial Matters) Act 2011 (2011 No 63).