Section GB 26 — Income Tax Act 2007: Arrangements involving repatriation of commercial bills

GB 26 Arrangements involving repatriation of commercial bills When this section applies (1) This section applies when— (a) a commercial bill has been issued by— (i) a New Zealand resident who does not use the money lent in a business carried on through a fixed establishment outside New Zealand; or (ii) a non-resident who uses the money lent in a business carried on through a fixed establishment in New Zealand; and (b) a non-resident who holds the bill transfers it to another person (the New Zealand transferee ); and (c) the non-resident did not become a party to the bill for the purpose of carrying on a business through a fixed establishment in New Zealand; and (d) the New Zealand transferee is either— (i) a New Zealand resident; or (ii) a non-resident who becomes a party to the commercial bill for the purpose of carrying on a business through a fixed establishment in New Zealand; and (e) the transfer of the bill has the purpose of avoiding non-resident withholding tax (NRWT) or the approved issuer levy. Income (2) If the New Zealand transferee redeems the commercial bill, the redemption payment is income of the New Zealand transferee. New Zealand transferee treated as redeeming bill (3) For the purposes of this section, the New Zealand transferee is treated as redeeming the bill on the scheduled redemption date even if it is not redeemed. Defined in this Act: approved issuer , commercial bill , fixed establishment , income , money lent , New Zealand resident , non-resident , NRWT , redemption payment , Compare: 2004 No 35 s GC 14A