Income Tax Act 2007

Recharacterisation of certain transactions - Terminating provisions

FZ 9: Transfers of trading stock to non-associates, donee organisations, or public authorities

You could also call this:

"Transferring trading stock to charities, government, or non-related people without using market value"

When you transfer trading stock to someone you are not associated with, or to a donee organisation or public authority, a certain rule does not apply. This rule is Section FC 2(1), which says you must transfer property at market value. The transfer must happen between 17 March 2020 and 31 March 2024, or during a period set by an Order in Council made under section 225ABA of the Tax Administration Act 1994. You are not associated with someone if you do not have a close relationship with them, like family or business partners. A donee organisation is a charity, and a public authority is a government organisation. If you transfer trading stock to one of these groups during the set period, the market value rule does not apply. The trading stock must belong to you, the person transferring it.

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View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=LMS484618.

This page was last updated on 29 January 2026 — View changes

Topics:

Money and consumer rights > TaxesBusiness > Industry rules

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Part FRecharacterisation of certain transactions
Terminating provisions

FZ 9Transfers of trading stock to non-associates, donee organisations, or public authorities

Section FC 2(1) (Transfer at market value) does not apply to a transfer of property if—
the property is trading stock of the transferor; and
the transferee—
1. is not associated with the transferor; or
2. is associated with the transferor, but is a donee organisation or a public authority; and
the transfer is made in—
1. the period that begins on 17 March 2020 and ends on 31 March 2024; or
2. a period specified by an Order in Council made under section 225ABA of the Tax Administration Act 1994.

Notes

Section FZ 9: inserted (with effect on 17 March 2020), on 30 March 2021, by section 74 of the Taxation (Annual Rates for 2020–21, Feasibility Expenditure, and Remedial Matters) Act 2021 (2021 No 8).
Section FZ 9(c)(i): amended, on 1 April 2023, by section 72 of the Taxation (Annual Rates for 2022–23, Platform Economy, and Remedial Matters) Act 2023 (2023 No 5).