Section EW 43 — Income Tax Act 2007: Consideration when debt sold at discount to associate of debtor

EW 43 Consideration when debt sold at discount to associate of debtor When this section applies (1) This section applies when a creditor sells a debt on or after 20 May 1999 to a person associated with the debtor and at a discount. At a discount (2) A creditor sells a debt at a discount if the creditor sells it for 80% or less of the market value of the debt. Market value (3) The market value of a debt affected by any of the following factors is determined as if its market value were not affected by the factor. The factors are— (a) the occurrence of an event reducing or cancelling the debtor’s obligations under the debt; or (b) the occurrence of 1 of the following between the date on which the debt was entered into and the date of the disposal: (i) a decline in the debtor’s creditworthiness; or (ii) an increase in the possibility that the debtor will not meet an obligation under the debt. Consideration (4) The debtor is treated as having paid the creditor the amount that the person associated with the debtor pays the creditor. Defined in this Act: amount , associated person , consideration , pay , Compare: 2004 No 35 s EW 45 Section EW 43(1): amended, on 1 April 2010, by section 21 of the Taxation (Consequential Rate Alignment and Remedial Matters) Act 2009 (2009 No 63). Section EW 43 list of defined terms 1988 version provisions : repealed, on 1 April 2010, by section 594 of the Taxation (International Taxation, Life Insurance, and Remedial Matters) Act 2009 (2009 No 34).