Vol 31 No 3
Issued
01 Apr 2019

TIB - April 2019

New legislation

  • Life reinsurance
  • BEPS - Administrative measures
  • BEPS - Transfer pricing rules
  • BEPS - Permanent establishment anti-avoidance rules
  • BEPS - Hybrid and branch mismatching rules
  • BEPS - Interest limitation rules

Orders in council

  • Tax Administration (Direct Credit of Income Tax and Gaming Machine Duty Refunds) Order 2019
  • CRS reportable jurisdictions amendment regulations

Product ruling

BR Prd 19/01: Milldale Infrastructure LP

Interpretation statement

IS 19/01: Income tax – application of schedular payment rules to non-resident directors’ fees

Standard practice statement

SPS 19/01: Tax payments – when received in time

Operational position

Commissioner’s operational position on IS 19/01 – Income Tax – How schedular payment rules apply to non-resident directors’ fees

Legislation and determinations

  • 2019 International Tax Disclosure Exemption ITR30
  • Special Determination S61: Optional Convertible Notes with Discretionary Interest Payments
  • Special Determination S62: Spreading method to be applied by Landowners making Infrastructure Payments to fund bulk infrastructure under a Final Encumbrance
  • Participating jurisdictions for the CRS applied standard

Legal decisions – case notes

  • Taxation Review Authority confirms amounts received not loan repayments, but deemed dividends
  • High Court clarifies when payments made in support of overseas mission services qualify for tax credits
  • High Court clarifies the meaning of “year” for calculating “ongoing daily care” for the Child Support Act 1991
  • Taxation Review Authority considers whether it has the power to approve publication of a taxpayer’s affairs on application by the taxpayer

Corrections

The table published in the Hybrid mismatches item on page 42 (titled "Table 1: New Zealand's implementation of the OECD recommendations") is incorrect.

The second part of that table ("Specific rule recommendations") should have contained the following information:

 Section Rec.  Hybrid mismatch  Hybrid arrangement  Corresponding branch agreement  Counteraction  Scope 
 CW 9 2 D/NI Hybrid financial instruments – specific rules**   2.1 Payee country should turn off any exemption
2.2 Restrict foreign tax credits to hybrid arrangement
No limit
 Subpart EX 5 D/NI Reverse hybrids – specific rules***  Disregarded branch structure and diverted branch payments 5.1 Improve CFC and other offshore rules
5.2 Turn off transparency/non-taxation
5.3 Improved disclosure
Specific to NZ's domestic law