32GEvidence of annual gross income and consequences of failure to meet threshold

1. This section applies when a person’s application for RWT-exempt status is based on their meeting the requirements in section 32E(2)(j).

2. The person must provide evidence to satisfy the Commissioner of their annual gross income for the accounting year. They must provide the evidence within the 3-month period after the end of the accounting year.

3. For the purposes of subsection (2), the Commissioner may require further evidence, and also for the purposes of section 32L.

4. If the person’s annual gross income for the tax year referred to in section 32E(2)(j) is less than $2,000,000, they are liable for late payment penalties in relation to an amount received or derived by them that would have been withheld under the RWT rules, had they not had RWT-exempt status. Section 139B applies to the person as if—

5. they had failed to withhold an amount of tax; and
6. the default occurred on each day on which they received or derived a payment from which RWT would otherwise have been withheld.

7. In the calculation of estimated annual gross income of a company that anticipates that it will be part of a group of companies for the tax year referred to in section 32E(2)(j), the estimated annual gross income of all other group companies is included.

8. Despite subsection (5), in the calculation of the annual gross income of a company for the purposes of this section, an amount of income derived by them or another company in the same group of companies from a transaction or series of related or connected transactions with another company in the group is excluded.

9. Despite subsections (2) and (4), the Commissioner may provide RWT-exempt status to, or allow RWT-exempt status to be retained by, a person who does not meet the requirements of section 32E(2)(j) if the Commissioner considers that the failure is solely a consequence of extraordinary circumstances that are—

10. beyond the person’s reasonable control; and
11. unlikely to be repeated in later accounting years.

12. For the purposes of subsection (6), the Commissioner may remit some or all of a late payment penalty if the Commissioner considers that the failure is solely a consequence of extraordinary circumstances that the person could not reasonably be expected to have foreseen.