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Income Tax Act 2007

Taxation of certain entities - Portfolio investment entities - Calculating and paying tax liability

HM 46: Calculation process

You could also call this:

“How to calculate tax for multi-rate PIEs”

When you are a multi-rate PIE (Portfolio Investment Entity), you need to follow these steps to work out how much tax you owe:

First, you need to figure out the net amount for each group of investors in your PIE. This means adding up all the money that came in and taking away all the money that went out for each group.

Next, you need to work out the taxable amount for each group of investors. This is the part of the net amount that you need to pay tax on.

Finally, you need to calculate how much tax each investor in each group owes for every day of the time period you’re looking at. This helps make sure everyone pays the right amount of tax based on how long they’ve been invested and how much they’ve invested.

By following these steps, you can figure out exactly how much tax your PIE needs to pay.

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View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=DLM2888809.

Topics:
Money and consumer rights > Taxes
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HM 45: Voluntary payments, or

“Explaining when multi-rate PIEs can make voluntary tax payments for investors”

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HM 47: Calculation of tax liability or tax credit of multi-rate PIEs, or

“Working out how much tax a multi-rate PIE owes or is owed”

Part H Taxation of certain entities
Portfolio investment entities: Calculating and paying tax liability

HM 46Calculation process

  1. To calculate its tax liability, a multi-rate PIE must—

  2. determine the net amount for each investor class of the PIE:
    1. determine the taxable amount for each investor class of the PIE:
      1. calculate its tax liability for each investor in an investor class for each day of an attribution period.

        Compare
        • ss HL 19, HL 20
        Notes
        • Section HM 46: inserted, on (applying for the 2010–11 and later income years), by section 292(1) of the Taxation (International Taxation, Life Insurance, and Remedial Matters) Act 2009 (2009 No 34).