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Income Tax Act 2007

Definitions and related matters - Measurement of company ownership

YC 6: Disregarding certain securities

You could also call this:

“ Ignoring specific types of company securities and options when applying certain tax rules ”

When a company issues something called an excluded fixed rate security, or when someone gets an excluded option for a company’s share, or when a company issues a pre-1991 budget security, some special rules apply. These rules are used in sections YC 2 to YC 5 of the law.

In these cases, you should act as if the excluded fixed rate security, excluded option, or pre-1991 budget security was never issued or given out. Also, you should treat the person who has one of these as if they never had it at all.

However, there’s an exception to these rules. Section YC 20 can override what’s said here, so you need to check that section too.

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View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=DLM1523076.

Topics:

Money and consumer rights > Taxes

YC 5B: Treatment of mixed-ownership enterprises, or

“How the government's ownership in mixed-ownership enterprises is treated for tax purposes”

YC 7: When sections YC 8 to YC 19B apply, or

“When special rules apply to change how continuity provisions work”

Part Y Definitions and related matters
Measurement of company ownership

YC 6Disregarding certain securities

This section applies for the purposes of sections YC 2 to YC 5 if—
a company has issued an excluded fixed rate security:
an excluded option has been granted in relation to a share in a company:
a company has issued a pre-1991 budget security.

The excluded fixed rate security, excluded option, or pre-1991 budget security is treated as never having been issued or granted.
The holder of the excluded fixed rate security, excluded option, or pre-1991 budget security is treated as never having held it.
This section is overridden by section YC 20.

Compare

2004 No 35 ss OD 3(3)(c), OD 4(3)(c)

Notes

Section YC 6(4): amended (with effect on 1 April 2008), on 6 October 2009, by section 568(1) of the Taxation (International Taxation, Life Insurance, and Remedial Matters) Act 2009 (2009 No 34).