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Income Tax Act 2007

Memorandum accounts - Imputation credit accounts (ICA)

OB 84: When and how group company transferring tax loss makes election

You could also call this:

“How a company tells the government about sharing its tax loss with another company in its group”

If you’re a company that wants to share your tax loss with another company in your group, you need to tell the government about it. You do this by making an election. Here’s how it works:

You need to make the election when you’re making the tax loss available to the other company. You have to tell the tax office (called the Commissioner) about it using their approved electronic system. You need to do this by the same date that you would normally tell them about sharing your tax loss.

When you tell the tax office, you need to give them some important information. This includes:

  1. Your company’s name and tax number
  2. The name and tax number of the company getting your tax loss
  3. The name and tax number of the company that will be giving tax credits
  4. How much of the tax loss you’re sharing
  5. How much money the other company paid you for the tax loss

Remember, you can only do this with companies that are in the same group as yours. It’s important to follow these rules carefully to make sure everything is done correctly.

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View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=DLM7224188.

Topics:
Money and consumer rights > Taxes
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OB 83: Group companies transferring imputation credits with transfer of tax loss, or

“Companies can transfer tax credits when sharing tax losses with related companies”

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Part O Memorandum accounts
Imputation credit accounts (ICA)

OB 84When and how group company transferring tax loss makes election

  1. A company (the loss company) that makes an election under section OB 83(1) relating to a tax loss made available by the company to a member of the same group of companies (the profit company) must make the election when the tax loss is made available and give the notice required by subsection (2).

  2. The company must notify the Commissioner of the election by electronic means in a way acceptable to the Commissioner and by the due date under section IC 9 (Date for payment and notice to the Commissioner) for notifying the Commissioner of the election under section IC 5 (Company B using company A’s tax loss) to make the tax loss available.

  3. A notice required by subsection (2) must include—

  4. the name and tax file number of the loss company:
    1. the name and tax file number of the profit company:
      1. the name and tax file number of the company meeting the requirements of section OB 83(5) that the loss company elects to be a transferor of imputation credits to the profit company:
        1. the amount of tax loss that is subject to the election under section IC 5(2)(a) made by the loss company in favour of the profit company:
          1. the amount of the payments referred to in section IC 5(2)(b) made by the profit company to the loss company in relation to the tax loss.

            Notes
            • Section OB 84: inserted (with effect on 1 October 2016 and applying for the 2017–18 and later income years), on , by section 213(1) of the Taxation (Annual Rates for 2016–17, Closely Held Companies, and Remedial Matters) Act 2017 (2017 No 14).