Vol 8 No 9
Issued
01 Nov 1996

TIB - November 1996

The Taxation (Core Provisions) Bill was introduced into Parliament on 7 December 1995. It was passed on 26 July 1996, and became the Taxation (Core Provisions) Act 1996 [No.67]. This Act amends the Income Tax Act 1994 and the Tax Administration Act 1994. It also makes consequential amendments to several other Acts.

Corrections

Amounts remitted to be gross income

Section CE 4(1) Income Tax Act 1994 states:

  1. Subject to section EZ 9(2), where the amount of any expenditure or loss incurred by a taxpayer has been allowed as a
    deduction for any income year, and subsequently the liability of the taxpayer in respect of that amount is remitted or cancelled in
    whole or in part, the amount so remitted or cancelled shall be deemed to be gross income for that income year.

The Commissioner is of the view that the words “that income year” refer to the income year in which the deduction was taken. This view is supported by section CE 4(3) which removes the time bar for amending an assessment when applying section CE 4.

This corrects the item in Tax Information Bulletin Vol 8, No 9 (November 1996)