Section CD 16 — Income Tax Act 2007: Certain dividends not increased by tax credits

CD 16 Certain dividends not increased by tax credits When this section applies (1) This section applies when a unit trust manager, in the ordinary course of their management activities for a unit trust,— (a) acquires units from unit holders under the terms on which the units were offered to potential unit holders; and (b) derives a dividend from the redemption or other cancellation of units in the unit trust. Credit not included (2) For the purposes of Parts B , C , E , and F , the dividend derived does not include an amount of imputation credit attached to it to the extent to which the dividend (exclusive of the imputation credit) recovers the price paid by the unit trust manager to acquire the units. Relationship with section FA 3 (3) To the extent to which subsection (2) applies, section FA 3 (Recharacterisation of certain dividends: recovery of cost of shares held on revenue account) does not apply. Some definitions (4) In this section,— imputation credit includes an FDP credit unit trust manager includes— (a) a person nominated by the unit trust manager; or (b) a trustee or a manager of a group investment fund that derives category A income; or (c) a person nominated by the trustee or the manager of the group investment fund. Defined in this Act: amount , cancellation , dividend , FDP credit , imputation credit , pay , tax , unit trust , unit trust manager Compare: 2004 No 35 s CD 10