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Income Tax Act 2007

Timing and quantifying rules - Terminating provisions - Entry to new life insurance regime: transitional and miscellaneous provisions

EZ 80: Refund of excess deposit in main income equalisation account as consequence of election under section EZ 4B

You could also call this:

“Refund for overpayment into income equalisation account due to Mycoplasma bovis cattle sale income spreading”

This section talks about what happens when you choose to spread your income from selling cattle because of Mycoplasma bovis. If you make this choice, you might have put too much money into your main income equalisation account for the year. If this happens, the Commissioner will give you back the extra money you put in.

The Commissioner will refund you as much as they can from the money you put in that year. They’ll do this as soon as possible after you make your choice. The refund will include any interest you earned on that extra money.

Sometimes, the Commissioner might not be able to refund all the extra money because some of it has already been given back to you for other reasons. In this case, they’ll treat the earliest refunds as if they weren’t given back before, so they can give you the full amount you should get.

The refund you get is split into two parts. The interest part is counted as income. The rest of the refund is not counted as income.

Interest on the extra money is worked out daily from when you put the money in until you make your choice to spread your income. The interest builds up until 31 March each year or until you make your choice, whichever comes first.

This section is more important than the usual rules about refunding extra deposits.

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View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=LMS484606.

Topics:
Money and consumer rights > Taxes
Environment and resources > Farming and fishing
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EZ 81: Refund of excess deposit in adverse event income equalisation account as consequence of election under section EZ 4B, or

“Refund of extra money in your special farming account after choosing to spread out cattle income”

Part E Timing and quantifying rules
Terminating provisions: Entry to new life insurance regime: transitional and miscellaneous provisions

EZ 80Refund of excess deposit in main income equalisation account as consequence of election under section EZ 4B

  1. This section applies when—

  2. a person makes an election under section EZ 4B(2) (Cattle destroyed because of Mycoplasma bovis: spreading); and
    1. as a consequence of the election, the person’s deposits for an accounting year, less the amount of any refund made to the person for the accounting year under section EH 8 (Refund of excess deposit), are more than their main maximum deposit for the accounting year.

      1. The Commissioner must refund the excess to the person from deposits the person made for the accounting year—

      2. to the extent to which, at the time the election is made, the person has sufficient deposits made for the accounting year in their main income equalisation account to enable the Commissioner to do so; and
        1. as soon as practicable after the election is made.

          1. The amount of the refund must include any interest payable under section EH 6 (Interest on deposits in main income equalisation account) on a deposit from which the excess must be refunded.

          2. Subsection (5) applies when the Commissioner is unable to refund the full amount of the excess to the person from deposits the person made for the accounting year because some or all of those deposits (the refunded deposits) have already been refunded to the person under section EH 13 or EH 15 (which relate to refunds from main income equalisation accounts).

          3. The earliest of the refunded deposits to have been refunded, to the extent necessary to make up the shortfall, are treated as—

          4. not having been refunded under section EH 13 or EH 15, as applicable; and
            1. having been refunded under this section.

              1. A refund under this section is,—

              2. to the extent to which the refund is interest payable under section EH 6, income under section CZ 37(1) (Income equalisation schemes); and
                1. to the extent to which the refund is not interest payable under section EH 6, excluded income under section CZ 37(2).

                  1. Section EH 6 applies to a deposit that forms all or part of the excess, other than a deposit that has been refunded before the election is made, with the following modifications:

                  2. interest is computed with daily rests from the date of acknowledgment of the receipt of the deposit until the date the election is made:
                    1. interest on the deposit accrues until the earlier of—
                      1. 31 March in each year; and
                        1. the date the election is made.

                        2. This section overrides section EH 8.

                        Notes
                        • Section EZ 80: inserted (with effect on 1 April 2017), on , by section 57(1) (and see section 57(2) for application) of the Taxation (Annual Rates for 2020–21, Feasibility Expenditure, and Remedial Matters) Act 2021 (2021 No 8).