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Income Tax Act 2007

Timing and quantifying rules - Terminating provisions - Definitions

EZ 52B: Consistency of use of IFRS method: Determination G3 change allowed

You could also call this:

“Changes allowed to tax calculation method for financial agreements in certain situations”

This law explains when you can change how you calculate taxes for some money-related agreements. It applies in different years depending on your situation:

For most people, it applies in the 2009-2010 tax year. But if you’re working with someone you owe money to (called a creditor workout), you might be able to use it in 2008-2009 or 2009-2010 if you tell the tax office. You can also use it in later years if you’re in a creditor workout, but you need to tell the tax office before you file your tax return.

The law says you can change to or from a method called ‘Determination G3’ or something similar to calculate your taxes. But you can only use this new method if it’s allowed for your situation.

This gives you more options for how to do your taxes when you’re dealing with complicated money agreements, especially if you’re working things out with someone you owe money to.

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View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=DLM2573110.

Topics:

Money and consumer rights > Taxes

EZ 52: References to new rules include old rules, or

“New rules for financial arrangements may also apply to old arrangements”

EZ 52C: Change of spreading method: Determination G22 to Determination G22A, or

“Changing tax calculation method for optional convertible notes”

Part E Timing and quantifying rules
Terminating provisions: Definitions

EZ 52BConsistency of use of IFRS method: Determination G3 change allowed

This section applies to a financial arrangement of a person—
for the 2009–10 income year, unless paragraph (b) or (c) applies:
for the 2008–09 or the 2009–10 income year (a retrospective year) if—
1. the financial arrangement is subject to a creditor workout in a retrospective year; and
2. the person notifies the Commissioner of their election to apply this section to the financial arrangement for a retrospective year:
for an income year after the 2009–10 income year, if—
1. the financial arrangement is subject to a creditor workout in the relevant income year; and
2. the person notifies the Commissioner of their election to apply this section to the financial arrangement for the relevant income year before the last day for filing a return of income for that income year.

For the purposes of the exception in section EW 25B(2) (Consistency of use of IFRS method), the person may change a method for IFRS for the financial arrangement if—
the method they change to or from is Determination G3 under section EW 15E(2)(aa) (Determination alternatives) or an alternative to Determination G3 under section EW 15E(2)(e) (What is included when spreading methods used); and
that method is available to them to use.

Notes

Section EZ 52B: added (with effect on 1 April 2008), on 6 October 2009, by section 198 of the Taxation (International Taxation, Life Insurance, and Remedial Matters) Act 2009 (2009 No 34).
Section EZ 52B(1)(b)(ii): amended, on 2 June 2016, by section 44(1) of the Taxation (Transformation: First Phase Simplification and Other Measures) Act 2016 (2016 No 27).
Section EZ 52B(1)(c)(ii): amended, on 2 June 2016, by section 44(2) of the Taxation (Transformation: First Phase Simplification and Other Measures) Act 2016 (2016 No 27).
Section EZ 52B(2)(a): amended (with effect on 1 April 2008), on 7 December 2009, by section 40 of the Taxation (Consequential Rate Alignment and Remedial Matters) Act 2009 (2009 No 63).
Section EZ 52B list of defined terms notify: inserted, on 2 June 2016, by section 44(3) of the Taxation (Transformation: First Phase Simplification and Other Measures) Act 2016 (2016 No 27).