Plain language law

New Zealand law explained for everyone

RA 8: Liability of persons receiving payments or benefits
or “You might need to pay tax on payments or benefits you receive”

You could also call this:

“Money withheld from your payment is treated as if you received it”

When someone takes money out of your payment because of this part of the law, you should think of that money as if you got it yourself. This happens when you get the payment, not before or after. The law sees it as your money, just like the rest of your payment.

This rule includes money taken out for taxes and other payments related to your job. But it doesn’t apply to a special kind of payment called a “replacement payment” that happens when people lend and borrow shares.

Remember, the law treats the money taken out as if it’s still yours, even though you didn’t actually get it in your hand. It’s like the money took a detour before reaching you, but the law still counts it as yours.

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Next up: RA 10: When obligations not met

or “Consequences for failing to meet tax payment obligations”

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Income Tax Act 2007
General collection rules
RA 9: Treatment of amounts withheld as received

Part R General collection rules
General withholding and payment obligations

RA 9Treatment of amounts withheld as received

An amount withheld from a payment under this Part, unless a provision in this Part states otherwise,—
is treated as received—
1. by the person to whom the payment is made; and
2. at the time the payment is made; and
is treated for the purposes of this Act as derived by the person at the same time and in the same way as they derive the payment from which the amount is withheld; and
includes a combined tax and earner-related payment.