The Issues Log

Section / Provision Income Tax Act 2007

Section / Provision Income Tax Act 2004

Date Received

This submission set out what we view as an unintended legislative change in section FE 36 of the Income Tax Act 2007 ("2007 Act") arising from the redraft of section FG 8C, the equivalent provision in the Income Tax Act 2004 ('2004 Act").

The section in each Act sets out the rules for determining a registered bank's New Zealand banking group.  Under the 2004 Act this includes all resident entities operating in New Zealand that would be required to consolidate with the registered bank, or ultimate foreign parent of the registered bank, for the purposes of generally accepted accounting practice ("GAAP").  However, the 2007 Act appears to include such entitles in the New Zealand banking group only where they are also part of the same group of companies as the registered bank.