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Income Tax Act 2007

Memorandum accounts - Imputation credit accounts (ICA)

OB 80: Co-operative companies’ notional distributions that are dividends

You could also call this:

"Dividends from co-operative companies"

Illustration for Income Tax Act 2007

You get a dividend when a co-operative company makes a notional distribution with an imputation credit. This dividend is under section CD 13. The amount of your dividend is calculated using a formula. You use the formula to work out your dividend. The formula is (credit attached ÷ tax rate) − credit attached. The tax rate is the basic rate of income tax set out in schedule 1. You derive the dividend on the date the co-operative company chooses to make a notional distribution under section OB 79. Section OZ 15 may apply to modify the formula.

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View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=DLM1518950.

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Topics:
Money and consumer rights > Taxes
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OB 79: Co-operative companies attaching imputation credits to notional distributions, or

"Co-operative companies can give tax credits on theoretical payments to shareholders"

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OB 81: Co-operative companies attaching FDP credits, or

"This rule about co-operative companies and tax credits no longer applies"

Part OMemorandum accounts
Imputation credit accounts (ICA)

OB 80Co-operative companies’ notional distributions that are dividends

  1. A notional distribution referred to in section OB 79 that has an imputation credit attached is a dividend under section CD 13 (Notional distributions of producer boards and co-operative companies) derived by a shareholder of the co-operative company.

  2. The amount of a shareholder’s dividend is calculated using the formula—

    (credit attached ÷ tax rate) − credit attached.

    Where:

    • In the formula,—

    • credit attached is the amount of imputation credit attached to the shareholder’s distribution:
      1. tax rate is the basic rate of income tax set out in schedule 1, part A, clause 2 (Basic tax rates: income tax, ESCT, RSCT, RWT, and attributed fringe benefits) for the income year.

        1. The shareholder derives the dividend on the date the co-operative company chooses under section OB 79 to make a notional distribution.

        2. Section OZ 15 (Attaching imputation credits and notional distributions: modifying amounts) may apply to modify subsection (2).

        Compare
        Notes
        • Section OB 80(2) formula: substituted (with effect on 1 April 2008), on (applying for the 2008–09 and later income years), by section 114(1) of the Taxation (Tax Administration and Remedial Matters) Act 2011 (2011 No 63).
        • Section OB 80(3)(b): amended, on , by section 562 of the Taxation (Business Taxation and Remedial Matters) Act 2007 (2007 No 109).
        • Section OB 80(5) heading: added, on , by section 503 of the Taxation (Business Taxation and Remedial Matters) Act 2007 (2007 No 109).
        • Section OB 80(5): added, on , by section 503 of the Taxation (Business Taxation and Remedial Matters) Act 2007 (2007 No 109).
        • Section OB 80 list of defined terms basic rate: repealed, on , by section 243 of the Taxation (Annual Rates for 2015–16, Research and Development, and Remedial Matters) Act 2016 (2016 No 1).