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Income Tax Act 2007

Definitions and related matters - Associated persons and nominees - Table Y1: Associated person rules

YB 14: Tripartite relationship

You could also call this:

“How you can be associated with someone through a third person”

You are associated with someone if they are connected to a third person, and that third person is connected to you. This is called a tripartite relationship. Here’s how it works:

Let’s say there are three people: you, your friend, and your friend’s cousin. If your friend is connected to their cousin in one way, and the cousin is connected to you in a different way, then you and your friend are considered associated.

However, this rule doesn’t apply if your friend is married to their cousin, and the cousin is your child.

For this rule, a limited partnership is treated the same as a company.

The ways people can be connected are explained in sections YB 2 to YB 13.

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View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=DLM1523028.

Topics:
Money and consumer rights > Taxes
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“Rules for determining association with look-through companies and their owners”

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“When trusts are set up for employees and not controlled by related parties”

Part Y Definitions and related matters
Associated persons and nominees: Table Y1: Associated person rules

YB 14Tripartite relationship

  1. Two persons (person A and person B) are associated persons if—

  2. person B is associated with a third person (person C) under any of sections YB 2 to YB 13; and
    1. person C is associated with person A under any of sections YB 2 to YB 13, excluding the section under which person B is associated with person C.

      1. Subsection (1) does not apply if—

      2. person B is associated with person C under section YB 2; and
        1. person C is associated with person A under section YB 3.

          1. Repealed

          2. For the purpose of applying subsection (1), a limited partnership is treated as being a company.

          Notes
          • Section YB 14: substituted, on , by section 563(1) of the Taxation (International Taxation, Life Insurance, and Remedial Matters) Act 2009 (2009 No 34).
          • Section YB 14(1)(a): amended, on (applying for income years beginning on or after 1 April 2011), by section 135(1)(a) of the Taxation (GST and Remedial Matters) Act 2010 (2010 No 130).
          • Section YB 14(1)(a): amended, on , by section 120 of the Taxation (Consequential Rate Alignment and Remedial Matters) Act 2009 (2009 No 63).
          • Section YB 14(1)(b): amended, on (applying for income years beginning on or after 1 April 2011), by section 135(1)(b) of the Taxation (GST and Remedial Matters) Act 2010 (2010 No 130).
          • Section YB 14(1)(b): amended, on , by section 120 of the Taxation (Consequential Rate Alignment and Remedial Matters) Act 2009 (2009 No 63).
          • Section YB 14(3) heading: repealed (with effect on 1 April 2009), on , pursuant to section 290 of the Taxation (Annual Rates for 2016–17, Closely Held Companies, and Remedial Matters) Act 2017 (2017 No 14).
          • Section YB 14(3): repealed (with effect on 1 April 2009), on , by section 290 of the Taxation (Annual Rates for 2016–17, Closely Held Companies, and Remedial Matters) Act 2017 (2017 No 14).
          • Section YB 14(4) heading: inserted (with effect on 1 April 2010 and applying for the purposes of provisions other than the land provisions, for the 2010–11 and later income years, or of the land provisions other than section CB 11, for land acquired on or after 6 October 2009, or of section CB 11, for land on which improvements are begun on or after 6 October 2009), on , by section 100(1) of the Taxation (Livestock Valuation, Assets Expenditure, and Remedial Matters) Act 2013 (2013 No 52).
          • Section YB 14(4): inserted (with effect on 1 April 2010 and applying for the purposes of provisions other than the land provisions, for the 2010–11 and later income years, or of the land provisions other than section CB 11, for land acquired on or after 6 October 2009, or of section CB 11, for land on which improvements are begun on or after 6 October 2009), on , by section 100(1) of the Taxation (Livestock Valuation, Assets Expenditure, and Remedial Matters) Act 2013 (2013 No 52).
          • Section YB 14 list of defined terms limited partnership: inserted (with effect on 1 April 2010), on , by section 100(2) of the Taxation (Livestock Valuation, Assets Expenditure, and Remedial Matters) Act 2013 (2013 No 52).