Section EW 15I — Income Tax Act 2007: Mandatory use of yield to maturity method for some arrangements

EW 15I Mandatory use of yield to maturity method for some arrangements When this section applies (1) This section applies and section EW 15C(1) does not apply when— (a) a person is not required to use a method under section EW 15H for a financial arrangement; and (b) the financial arrangement— (i) includes in part an excepted financial arrangement; or (ii) is treated by the person or its issuer, all or in part, as an equity instrument under IFRSs; or (iib) is, under NZIAS 17 and in the person's financial statements, classified as an operating lease; or (iii) is an agreement for the sale and purchase of property or services. Methods (2) The person must use 1 of the following methods to allocate an amount to an income year if the method is available under its terms for the person to use: (a) the yield to maturity method: (b) Determination G26: Variable rate financial arrangements or a determination that succeeds it: (c) a determination made by the Commissioner under section 90AC(1)(bb) of the Tax Administration Act 1994: (d) a method other than those set out in paragraphs (a) to (c) if the alternative— (i) has regard to the purposes of the financial arrangements rules under section EW 1(3) ; and (ii) is for a financial arrangement similar to 1 to which the methods set out in paragraphs (a) to (c) may apply; and (iii) results in the allocation to each income year of amounts that are not materially different from those that would have been allocated using 1 of the methods set out in paragraphs (a) to (c). Meaning of equity instrument (3) For the purposes of this section, equity instrument has the same meaning as in NZIAS 32. Defined in this Act: agreement for the sale and purchase of property or services , amount , Commissioner , equity instrument , excepted financial arrangement , financial arrangement , financial arrangements rules , IFRS , income year , issue , NZIAS 17 , NZIAS 32 Compare: 2004 No 35 s EW 15B(4) Section EW 15I: inserted, on 1 April 2008, by section 366 of the Taxation (Business Taxation and Remedial Matters) Act 2007 (2007 No 109). Section EW 15I(1)(b)(iib): inserted (with effect on 1 April 2008), on 6 October 2009, by section 140(1) of the Taxation (International Taxation, Life Insurance, and Remedial Matters) Act 2009 (2009 No 34). Section EW 15I list of defined terms NZIAS 17 : added (with effect on 1 April 2008), on 6 October 2009, by section 140(2) of the Taxation (International Taxation, Life Insurance, and Remedial Matters) Act 2009 (2009 No 34). Section EW 15I list of defined terms NZIAS 32 : added (with effect on 1 April 2008), on 29 August 2011 (applying for the 2008–09 and later income years), by section 140(1) of the Taxation (Tax Administration and Remedial Matters) Act 2011 (2011 No 63).