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Income Tax Act 2007

Definitions and related matters - Residence and source in New Zealand

YD 2: Residence of companies

You could also call this:

“How a company is determined to be a New Zealand resident for tax purposes”

For the purposes of this Act, a company is considered a New Zealand resident if any of these things are true:

You incorporate the company in New Zealand.

The company’s head office is in New Zealand.

The company’s centre of management is in New Zealand.

The company’s directors control it from New Zealand, even if they also make decisions outside of New Zealand.

This rule about company residence also applies to companies that are acting as trustees.

If a company stops being a New Zealand company but then becomes one again within 183 days, it’s treated as if it never stopped being a New Zealand company for international tax rules.

There’s a special exception: The trustee of the Cook Islands National Superannuation Fund is not considered a New Zealand resident, even if it meets the other criteria.

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View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=DLM1523137.

Topics:
Money and consumer rights > Taxes
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YD 1: Residence of natural persons, or

“How to determine if you're a New Zealand tax resident”

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YD 3: Country of residence of foreign companies, or

“How to determine a foreign company's home country for tax reasons”

Part Y Definitions and related matters
Residence and source in New Zealand

YD 2Residence of companies

  1. A company is a New Zealand resident for the purposes of this Act if—

  2. it is incorporated in New Zealand:
    1. its head office is in New Zealand:
      1. its centre of management is in New Zealand:
        1. its directors, in their capacity as directors, exercise control of the company in New Zealand, even if the directors’ decision-making also occurs outside New Zealand.

          1. In this section, a company includes a company that is acting in the capacity of trustee.

          2. Despite subsection (1), for the purpose of the international tax rules, a company is treated as remaining resident in New Zealand if it becomes a foreign company but is resident in New Zealand again within 183 days afterwards.

          3. Despite subsection (1), the trustee of the Cook Islands National Superannuation Fund, established by the Cook Islands National Superannuation Fund Deed under the Cook Islands National Superannuation Scheme Act 2000 (Cook Islands), is not a New Zealand resident.

          Compare
          Notes
          • Section YD 2(1B) heading: inserted, on , by section 247(1) of the Taxation (Annual Rates for 2017–18, Employment and Investment Income, and Remedial Matters) Act 2018 (2018 No 5).
          • Section YD 2(1B): inserted, on , by section 247(1) of the Taxation (Annual Rates for 2017–18, Employment and Investment Income, and Remedial Matters) Act 2018 (2018 No 5).
          • Section YD 2 list of defined terms trustee: inserted, on , by section 247(2) of the Taxation (Annual Rates for 2017–18, Employment and Investment Income, and Remedial Matters) Act 2018 (2018 No 5).