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Tax Administration Act 1994

Interest - Specific provisions

120U: Bond provided for obligation to withhold or deduct amount of tax

You could also call this:

"Paying a bond to avoid withholding tax from payments"

Illustration for Tax Administration Act 1994

You give the Commissioner a bond or other security. This means you do not have to withhold or deduct tax from a payment to someone. If the Commissioner decides the payment should have had tax withheld or deducted, you will have to pay the tax. You will have to pay the tax by the date it would have been due if you had not given a bond or other security. The Commissioner will tell you when this date is. You must pay the tax by this date.

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View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=DLM355395.

Topics:
Money and consumer rights > Taxes
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"Interest added to tax you can pay later"

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Part 7Interest
Specific provisions

120UBond provided for obligation to withhold or deduct amount of tax

  1. If—

  2. under a tax law, a taxpayer provides the Commissioner with a bond or other security so that the taxpayer is not required to withhold or deduct an amount of tax from a payment made to any person; and
    1. the Commissioner subsequently determines that the payment was liable to have an amount of tax withheld or deducted,—
        1. the due date for the purpose of the definition of date interest starts for withholding or deducting the amount of tax is the date on which the amount withheld or deducted would have been payable to the Commissioner, if a bond or other security had not been provided.

      Notes
      • Section 120U: inserted, on , by section 36(1) of the Tax Administration Amendment Act (No 2) 1996 (1996 No 56).
      • Section 120U heading: amended, on (effective for 2008–09 income year and later income years, unless the context requires otherwise), by section ZA 2 of the Income Tax Act 2007 (2007 No 97).
      • Section 120U: amended, on (effective for 2008–09 income year and later income years, unless the context requires otherwise), by section ZA 2 of the Income Tax Act 2007 (2007 No 97).
      • Section 120U(a): amended, on (effective for 2008–09 income year and later income years, unless the context requires otherwise), by section ZA 2 of the Income Tax Act 2007 (2007 No 97).
      • Section 120U(b): amended, on (effective for 2008–09 income year and later income years, unless the context requires otherwise), by section ZA 2 of the Income Tax Act 2007 (2007 No 97).