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New Zealand law explained for everyone

Income Tax Act 2007

Treatment of tax losses - Attributed controlled foreign company net losses and foreign investment fund net losses

IQ 1A: When this subpart applies

You could also call this:

“This explains when you can use overseas investment losses or income in your NZ tax”

This part of the law applies to you if you have certain types of losses or income related to overseas investments in a tax year. It covers two main situations:

You have a loss from a controlled foreign company (CFC) or foreign investment fund (FIF). This loss can be from the current tax year or carried forward from an earlier year.
You have income from a CFC or FIF that was calculated using special methods (called the branch equivalent method or attributable FIF income method). In this case, someone else can give you some of their CFC or FIF losses to use.

These rules are about how you can use these overseas losses and incomes in your New Zealand tax calculations.

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View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=DLM4037948.

Topics:

Money and consumer rights > Taxes

IP 7: Notices required, or

“Companies must notify the government about using tax losses by the tax return due date”

IQ 1: General treatment, or

“How to carry forward and use tax losses from CFCs and FIFs”

Part I Treatment of tax losses
Attributed controlled foreign company net losses and foreign investment fund net losses

IQ 1AWhen this subpart applies

This subpart applies when, for a country or territory and a tax year, a person has—
an amount of attributed CFC net loss or FIF net loss—
1. for the tax year:
2. carried forward from an earlier tax year:
an amount of attributed CFC income or FIF income calculated under the branch equivalent method or attributable FIF income method and another person makes available to the person an amount of attributed CFC net loss or FIF net loss.

Notes

Section IQ 1A: inserted (with effect on 1 April 2008), on 29 August 2011 (applying for the 2008–09 and later income years), by section 92(1) of the Taxation (Tax Administration and Remedial Matters) Act 2011 (2011 No 63).
Section IQ 1A(b): amended, on 24 February 2016, by section 197(1) of the Taxation (Annual Rates for 2015–16, Research and Development, and Remedial Matters) Act 2016 (2016 No 1).
Section IQ 1A(b): amended (with effect on 1 July 2011), on 29 August 2011, by section 92(2) of the Taxation (Tax Administration and Remedial Matters) Act 2011 (2011 No 63).
Section IQ 1A list of defined terms attributable FIF income method: inserted, on 24 February 2016, by section 197(2)(b) of the Taxation (Annual Rates for 2015–16, Research and Development, and Remedial Matters) Act 2016 (2016 No 1).
Section IQ 1A list of defined terms attributed CFC income: inserted, on 24 February 2016, by section 197(2)(b) of the Taxation (Annual Rates for 2015–16, Research and Development, and Remedial Matters) Act 2016 (2016 No 1).
Section IQ 1A list of defined terms attributed CFC net income: repealed, on 24 February 2016, by section 197(2)(a) of the Taxation (Annual Rates for 2015–16, Research and Development, and Remedial Matters) Act 2016 (2016 No 1).
Section IQ 1A list of defined terms attributed FIF income method: repealed, on 24 February 2016, by section 197(2)(a) of the Taxation (Annual Rates for 2015–16, Research and Development, and Remedial Matters) Act 2016 (2016 No 1).
Section IQ 1A list of defined terms group: repealed, on 24 February 2016, by section 197(2)(a) of the Taxation (Annual Rates for 2015–16, Research and Development, and Remedial Matters) Act 2016 (2016 No 1).