Income tax imposed by section BB 1 (Imposition of income tax) of the Income Tax Act 2007 must, for the 2022–23 tax year, be paid at the basic rates specified in schedule 1 of that Act.

This Part amends the Income Tax Act 2007.

In section AA 1(a), replace “net income” with “a net amount of income”.

In section AA 1, list of defined terms,—

After section CB 6A(1A), insert:

In section CB 6A(2B), replace “person.” with “person (see also: section FC 9 (Residential land transferred to executor, administrator, or beneficiary on death of person).”

In section CB 6A(5B), replace “acquired subsequent to” with “converted subsequent to”.

In section CB 6A(5B), replace “the date the joint tenancy was acquired” with “the same as prior to the conversion”.

In section CB 6A(5C), replace “acquired subsequent to” with “converted subsequent to”.

In section CB 6A(5C), replace “the date the tenancy in common in equal shares was acquired” with “the same as prior to the conversion”.

Replace section CB 6A(5D) with:

Replace section CB 6AB(1), (2), and (3) with:

After section CB 6AB(2)(b), insert:

In section CB 6AB(4), replace “If a person transfers the same land to themselves in a different capacity, and there is no intervening transfer to a third party,” with “If a person in 1 capacity transfers land to themselves in a different capacity,”.

In section CB 6AB(4), delete “, and must not be to or from a person in their capacity of settlor, beneficiary, or trustee”.

Repeal section CB 6AB(5)(a).

Replace section CB 6AB(5)(d) with:

After section CB 6AB(6)(a), insert:

Replace section CB 6AB(6)(c) with:

Replace section CB 6AC(1), (2), and (3) with:

Repeal section CB 6AC(4)(a).

In section CB 6AC(5), delete “, under section HF 2(3)(e)(i) (Who is eligible to be a Maori authority?)”.

Repeal section CB 16A(7).

After section CD 1(2), insert:

In section CD 1, list of defined terms, insert “company”, “double tax agreement”, “DRCD deferral date”, “New Zealand resident”, and “resident in New Zealand”.

In section CD 14(1), replace “(Treatment of emigrating companies and their shareholders)” with “or FL 3 (which relate to the treatment of emigrating companies and their shareholders)”.

In section CD 14(2), after “section FL 2”, insert “or FL 3, as applicable”.

In section CD 15(1)(a), after “dividend”, insert “subject to any limitation to the imputation credit made under section LE 5 where the person is a beneficiary”.

Subsection (1) applies for the 2008–09 and later income years.

In section CD 26(1)(b), replace “(Treatment of emigrating companies and their shareholders)” with “or FL 3 (which relate to the treatment of emigrating companies and their shareholders)”.

In section CD 36(2),—

After section CD 36(3), insert:

Subsection (1) applies for income years starting on or after 1 July 2014.

Subsection (2) applies for income years starting on or after 1 April 2023.

In section CD 43(16), replace “(Treatment of emigrating companies and their shareholders)” with “or FL 3 (which relate to the treatment of emigrating companies and their shareholders)”.

Replace section CE 1(3B), other than the heading, with:

In section CE 1, list of defined terms, insert “cross-border employee”.

After section CE 1E, insert:

After section CE 1F(3), insert:

In section CE 1F, list of defined terms, insert “double tax agreement”.

In section CQ 5(1)(c)(viii), delete “purchase”.

In section CQ 5, list of defined terms, insert “employee share scheme”.

In section CR 4(1)(a)(i), after “Appendix D”, insert “or IFRS 17”.

Replace section CR 4(3)(a)(ii) with:

In section CR 4, list of defined terms, insert “IFRS 17” and “present value (gross)”.

Subsections (1), (2), and (3) apply for income years starting on or after 1 January 2023.

In section CV 12, replace “section HC 8” with “section HC 8(2)”.

Subsection (1) applies for the 2022–23 and later income years.

After section CW 3, insert:

Replace the heading to section CW 10(1) with “Exempt income: dividends within wholly-owned groups”.

Replace section CW 10(1)(a) with:

In section CW 10(1)(e), replace “met.” with “met; and”.

After section CW 10(1)(e), insert:

After section CW 10(1), insert:

In section CW 10, list of defined terms, insert “amount”, “double tax agreement”, “fully imputed”, “New Zealand resident”, “New Zealand tax”, and “shareholder”.

After section CX 1, insert:

In section CX 9, after “employee”, insert “, unless section CX 19C or CX 19D applies”.

Subsection (1) applies to fringe benefits provided on or after 1 April 2023.

In section CX 10(2)(b), replace “a share purchase scheme” with “an exempt ESS”.

In section CX 10, list of defined terms,—

After section CX 19B, insert:

Subsection (1) applies to fringe benefits provided on or after 1 April 2023.

In section CX 26, insert—

In section CX 26, list of defined terms, insert “New Zealand” and “resident”.

In section CX 35(2)(b), replace “a share purchase scheme” with “an exempt ESS”.

In section CX 35, list of defined terms, insert “exempt ESS”.

In section CX 47(1)(a), replace “or a public authority” with “, a public authority, or a public purpose Crown-controlled company”.

In section CX 47, list of defined terms, insert “public purpose Crown-controlled company”.

In section CX 57B(1),—

After section CZ 23, insert:

Subsection (1) applies to payments made on or after the beginning of the relevant North Island flooding event.

After section CZ 24, insert:

Subsection (1) applies to payments made on or after the beginning of the relevant North Island flooding event.

After section CZ 29, insert:

After section CZ 39(1), insert:

In section CZ 39(5B), replace “acquired subsequent to” with “converted subsequent to”.

In section CZ 39(5B), replace “the joint tenancy was acquired” with “was the person’s bright-line acquisition date for the land prior to the conversion”.

In section CZ 39(5C), replace “acquired subsequent to” with “converted subsequent to”.

In section CZ 39(5C), replace “the tenancy in common was acquired” with “was the person’s bright-line acquisition date for the land prior to the conversion”.

In section CZ 39(7), replace “person.” with “person (see also: section FC 9 (Residential land transferred to executor, administrator, or beneficiary on death of person).”

Replace section CZ 39(5D) with:

After section DB 2(2), insert:

Replace section DB 53(1)(b) with:

In section DB 53, list of defined terms, insert “zero-rated investor”.

After section DB 67, insert:

Subsection (1) applies for the 2008–09 and later income years. However, subsection (1) does not apply for an income year before the 2024–25 income year if the person has—

Repeal section DD 11, definition of business premises.

In section DF 1(1)(a), replace “or a public authority” with “, a public authority, or a public purpose Crown-controlled company”.

In section DF 1(1B), replace “or public authority” with “authority, public authority, or public purpose Crown-controlled company”.

In section DF 1(3)(a), replace “or public authority” with “authority, public authority, or public purpose Crown-controlled company”.

In section DF 1, list of defined terms, insert “public purpose Crown-controlled company”.

After section DG 5(2)(c), insert:

In section DG 5, list of defined terms, insert “beneficiary”, “disallowed residential property”, and “interposed residential property holder”.

Replace section DG 11(1)(b) with:

In section DG 11, list of defined terms, delete “beneficiary”, “disallowed residential property”, and “interposed residential property holder”.

In section DH 6(2)(a)(i), replace “DH 4(1) to (3)” with “DH 4”.

Repeal section DH 6(2)(a)(ii).

In the heading to section DH 7(2), replace “balance” with “principal”.

Repeal section DH 9.

In section DH 10(6)(e), replace “under section DH 7(4) against the notional loan principal” with “under section DH 7(4), other than against the notional loan principal,”.

Replace the heading to section DH 12(2) with “Other property”.

In section DN 6(1)(c)(viii), delete “purchase”.

In section DN 6, list of defined terms, insert “employee share scheme”.

In section DW 4(1)(a)(i), after “Appendix D”, insert “, or IFRS 17”.

In section DW 4(4)(a)(i), after “year)”, insert “, if none of subparagraphs (ii), (iii), and (iv) applies”.

In section DW 4(4)(a)(ii), replace “insurer:” with “insurer; or”.

After section DW 4(4)(a)(ii), insert:

In section DW 4(4B), formula, replace “risk margin” with “risk adjustment”.

In section DW 4(4C)(c),—

In section DW 4, list of defined terms, insert “IFRS 17” and “present value (gross)”.

Subsections (1), (2), (3), (4), (5), (6), and (7) apply for income years starting on or after 1 January 2023.

After section EE 6(2), insert:

In section EE 6, list of defined terms, insert “utilities distribution asset”.

Subsections (1) and (2) apply for the 2008–09 and later income years. However, subsections (1) and (2) do not apply for an income year before the 2024–25 income year, if the person has—

Before section EE 7(g), insert:

In section EE 7, list of defined terms, insert “utilities distribution asset” and “utilities distribution network”.

Subsections (1) and (2) apply for the 2008–09 and later income years. However, subsections (1) and (2) do not apply for an income year before the 2024–25 income year if the person has—

In section EE 31(1), replace “(Treatment of emigrating companies and their shareholders)” with “or FL 3(2) (which relate to the treatment of emigrating companies and their shareholders)”.

After section EW 15B(4), insert:

In section EW 15B, list of defined terms, insert “Commissioner”, “expenditure”, “income year”, “life financial reinsurance”, “life insurer”, and “reinsurance contract”.

Subsections (1) and (2) apply for income years starting on or after 1 January 2023.

Replace section EW 15D(3)(a) with:

In section EW 24(3), replace “Section EW 26 sets out” with “Sections EW 26 and HM 35(8)(c) (Determining net amounts and taxable amounts) set out”.

Subsection (1) applies to the 2023–24 and later income years.

In section EW 46C(6), definition of nominal shares, replace “a share purchase scheme” with “an exempt ESS”.

In section EW 46C, list of defined terms, insert “exempt ESS”.

After section EW 46C, insert:

Replace section EX 20B(3)(c) with:

Subsection (1) applies for income years starting on or after 1 April 2023.

In section EX 20C(10)(b), after “of the CFC”, insert “, other than a deductible foreign equity distribution (the distribution) to the extent to which the distribution is funded directly or indirectly from an attributing interest that is an income interest in a FIF meeting the requirements of section EX 59(1),”.

Subsection (1) applies for income years starting on or after 1 April 2023.

In section EX 38(1)(f), replace “a employee share scheme” with “an employee share scheme”.

In section EX 46(10),—

Replace section EX 52(5), other than the heading, with:

Subsection (1) applies for income years starting on or after 1 July 2014.

Replace section EX 53(5), other than the heading, with:

Subsection (1) applies for income years starting on or after 1 July 2014.

In section EX 59(1B)(b), replace “(ii).” with “(ii); and”.

After section EX 59(1B)(b), insert:

Subsections (1) and (2) apply for income years starting on or after 1 July 2014.

In section EY 24(2)(a)(i), before “the amount”, insert “if subparagraphs (ii), (iii), and (iv) do not apply,”.

In section EY 24(2)(a)(ii), replace “IBNR liability” with “liability for claims incurred but not reported” in each place.

After section EY 24(2)(a)(ii), insert:

In section EY 24(3), formula,—

In section EY 24(4)(a), replace “life risk claims incurred” with “life risk claims incurred but not reported”.

In section EY 24(4)(c),—

After section EY 24(4), insert:

In section EY 24, list of defined terms, insert “GST”, “IFRS 17”, “life insurance policy”, “life reinsurance policy”, “outstanding claims reserve”, and “tax”.

Subsections (1), (2), (3), (4), (5), (6), (7), and (8) apply for income years starting on or after 1 January 2023.

In section FC 9(2), replace “administrator.” with “administrator (see also: sections CB 6A(2B) and CZ 39(7)).”

After section FC 9(3), insert:

Replace section FL 1(1), other than the heading, with: