Miscellaneous technical amendments

Taxable bonus issue definition

Section OB I of the Income Tax Act 1994

The definition of "taxable bonus issue" in the Income Tax Act 1994 has been amended to reflect changes to the definition of "taxable bonus issue" made in the Income Tax Act 2004 from 16 November 2004. The new definition recognises that taxable bonus issues that are exempt dividends in the hands of shareholders can be treated as taxable bonus issues, but only to the extent of the value of the reserves capitalised.

Application date

The amendment applied from 16 November 2004, the date when the equivalent changes were made in the 2004 Act.

Australian imputation account company eleigibility

The repeal of section ME 1(2)(a) in 2006 had the unintended consequence of restricting eligibility to be an Australian imputation credit account company. Former section ME 1(2)(a) - which provided that a non-resident company could not maintain an imputation credit account - was repealed because it was a redundant provision. Section ME 1A of the Income Tax Act 2004 and section OB 2 of the Income Tax Act 2007 have been amended to reinstate the previous ability of certain Australian-resident companies to elect to establish and maintain New Zealand imputation credit accounts.

Application date

This amendment applies for the 2005-06 and subsequent income years.