Section GB 17 — Income Tax Act 2007: Excessive amounts for film rights or production expenditure

GB 17 Excessive amounts for film rights or production expenditure When this section applies (1) This section applies when— (a) a person (the buyer ) is allowed a deduction under— (i) section DS 1 (Acquiring film rights) for expenditure incurred in acquiring a film right; or (ii) section DS 2 (Film production expenditure) for expenditure incurred in acquiring goods or services in relation to a film; and (b) the Commissioner considers that the buyer and the person from whom the film right, goods, or services were acquired (the seller ) were not dealing with each other at arm’s length; and (c) the amount of expenditure incurred by the buyer is more than the market value of the film right, goods, or services at the time they were acquired. Deduction reduced to market value (2) The deduction is reduced to an amount equal to the market value. Application to shares in film rights (3) If the buyer acquires only a share in a film right, this section applies only to the part of the total market value of the film right that is attributable to that share. Defined in this Act: Commissioner , deduction , film production expenditure , film right , Compare: 2004 No 35 ss GC 11A , GD 12 Section GB 17(1)(b): amended (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).