Section CB 36 — Income Tax Act 2007: Disposal of emissions units

CB 36 Disposal of emissions units When this section applies (1) This section applies when a person disposes of an emissions unit. Income (2) The amount that the person derives on the disposal is income. Surrender of unit: deemed sale at given value (3) If the disposal is by surrender under the Climate Change Response Act 2002 , the person is treated as having sold the unit, at the time of the surrender, to an unrelated person for an amount equal to— (a) the unit's cost, if none of paragraphs (b) to (f) applies; or (b) the unit's value under section ED 1(7B) (Valuation of excepted financial arrangements), if that subsection applies and none of paragraphs (c) to (f) apply; or (c) zero, if subsection (4) applies; or (d) zero, if subsection (5) applies; or (e) the unit's market value, if subsection (6) applies; or (f) the unit's market value, if subsection (7) applies. Surrender of unit: emissions relating to post-1989 forest land (4) The person is treated as selling the unit for an amount of zero if the person surrenders the emissions unit for emissions in relation to post-1989 forest land. Surrender of unit: under forest sink covenant (4B) The person is treated as selling the unit for an amount of zero if the person transfers the emissions unit to the Crown under a forest sink covenant under section 67Y of the Forests Act 1949. Surrender of unit: deforestation of some pre-1990 forest land (5) The person is treated as selling the unit for an amount of zero if— (a) the person surrenders the emissions unit in relation to the deforestation of pre-1990 forest land; and (b) the person would derive income, other than exempt income or excluded income, from a disposal of the land without timber at the time of the surrender. Surrender of post-1989 forest land emissions unit or forest sink emissions unit: for other purposes (6) The person is treated as selling a post-1989 forest land emissions unit or forest sink emissions unit for an amount equal to the unit's market value if the person surrenders the emissions unit other than— (a) for emissions in relation to post-1989 forest land: (b) by a transfer to the Crown under a forest sink covenant under section 67Y of the Forests Act 1949. Surrender of unit: free unit other than forest land unit (7) The person is treated as selling a unit that is not a forest land emissions unit for an amount equal to the unit's market value if— (a) the person surrenders the unit when it has a value of zero; and (b) the unit was transferred to the person under Part 4, subpart 2 of the Climate Change Response Act 2002 at a price of zero. Converted unit treated as sold (8) If a person converts a New Zealand emissions unit, other than a forest land emissions unit, into a Kyoto unit as defined in section 4(1) of the Climate Change Response Act 2002, the person is treated as having sold the converted unit for an amount equal to— (a) the unit's value under section ED 1(7B) , if that subsection applies; or (b) the unit's cost, otherwise. Excluded income: pre-1990 forest land emissions unit (9) Section CX 51B (Disposal of pre-1990 forest land emissions units) applies to the disposal to another person of a pre-1990 forest land emissions unit. Excluded income: fishing quota emissions unit (10) Section CX 51C (Disposal of fishing quota emissions units) applies to the disposal to another person of a fishing quota emissions unit. Defined in this Act: amount , convert , emissions unit , fishing quota emissions unit , forest land emissions unit , forest sink emissions unit , Kyoto emissions unit, New Zealand emissions unit , pre-1990 forest land emissions unit , post-1989 forest land emissions unit , surrender Section CB 36: substituted (with effect on 1 January 2009), on 6 October 2009, by section 10 of the Taxation (International Taxation, Life Insurance, and Remedial Matters) Act 2009 (2009 No 34). Section CB 36(4B) heading: inserted (with effect on 1 January 2009), on 7 September 2010, by section 6(1) of the Taxation (Annual Rates, Trans-Tasman Savings Portability, KiwiSaver, and Remedial Matters) Act 2010 (2010 No 109). Section CB 36(4B): inserted (with effect on 1 January 2009), on 7 September 2010, by section 6(1) of the Taxation (Annual Rates, Trans-Tasman Savings Portability, KiwiSaver, and Remedial Matters) Act 2010 (2010 No 109). Section CB 36(6) heading: substituted (with effect on 1 January 2009), on 7 September 2010, by section 6(2) of the Taxation (Annual Rates, Trans-Tasman Savings Portability, KiwiSaver, and Remedial Matters) Act 2010 (2010 No 109). Section CB 36(6): substituted (with effect on 1 January 2009), on 7 September 2010, by section 6(2) of the Taxation (Annual Rates, Trans-Tasman Savings Portability, KiwiSaver, and Remedial Matters) Act 2010 (2010 No 109). Section CB 36(7): substituted (with effect on 1 July 2010), on 21 December 2010, by section 27 of the Taxation (GST and Remedial Matters) Act 2010 (2010 No 130). Section CB 36(9) heading: substituted (with effect on 1 January 2009), on 7 September 2010, by section 6(3) of the Taxation (Annual Rates, Trans-Tasman Savings Portability, KiwiSaver, and Remedial Matters) Act 2010 (2010 No 109). Section CB 36(10) heading: added (with effect on 1 July 2010), on 7 September 2010, by section 6(4) of the Taxation (Annual Rates, Trans-Tasman Savings Portability, KiwiSaver, and Remedial Matters) Act 2010 (2010 No 109). Section CB 36(10): added (with effect on 1 July 2010), on 7 September 2010, by section 6(4) of the Taxation (Annual Rates, Trans-Tasman Savings Portability, KiwiSaver, and Remedial Matters) Act 2010 (2010 No 109). Section CB 36 list of defined terms fishing quota emissions unit : inserted (with effect on 1 July 2010), on 7 September 2010, by section 6(5)(a) of the Taxation (Annual Rates, Trans-Tasman Savings Portability, KiwiSaver, and Remedial Matters) Act 2010 (2010 No 109). Section CB 36 list of defined terms forest sink emissions unit : inserted (with effect on 1 January 2009), on 7 September 2010, by section 6(5)(b) of the Taxation (Annual Rates, Trans-Tasman Savings Portability, KiwiSaver, and Remedial Matters) Act 2010 (2010 No 109).