Section CZ 7 — Income Tax Act 2007: Primary producer co-operative companies: 1987–88 income year

CZ 7 Primary producer co-operative companies: 1987–88 income year Income: sale of asset (1) If a primary producer co-operative company disposes of an asset for which the company was allowed a deduction under section 200 of the Income Tax Act 1976 for the 1987–88 income year or an earlier income year, the company is treated as deriving income in the income year of disposal of an amount equal to the lesser of— (a) the total of all deductions relating to the asset that were allowed under section 200; and (b) the amount that the company derived from the disposal of the asset. Income: payments to shareholders (2) If a primary producer co-operative company has been allowed a deduction under section 200 for the 1987–88 income year or an earlier income year, and a payment has been made to a shareholder of the company either on the surrender of any of their shares or on the liquidation of the company, part of the payment is treated as income of the shareholder. The part that is income is determined under subsection (3). Amounts attributable to deductions (3) The part of the payment that is treated as income is only such part as— (a) is more than the available subscribed capital per share calculated under the slice rule of the shares surrendered or held on liquidation by the shareholder; and (b) is attributable to an increase in the value of the company’s assets that was caused by the company applying or appropriating a deduction allowed under section 200. Some definitions (4) In this section,— primary producer co-operative company means a company that, at the end of the 1987–88 income year,— (a) was a primary producer co-operative company, as defined in section 200(1) and (9); and (b) could qualify for a deduction under section 200(4) section 200 means section 200 of the Income Tax Act 1976 as it was in force before it was repealed by section 41(1) of the Income Tax Amendment Act (No 5) 1988 (which, in general, allowed primary producer co-operative companies to claim a deduction for profits that were reinvested in certain defined primary produce activities and assets). Defined in this Act: amount , available subscribed capital , income , income year , liquidation , pay , primary producer co-operative company , section 200 , share , shareholder , slice rule , Compare: 2004 No 35 s CZ 7