Section GC 1 — Income Tax Act 2007: Disposals of trading stock at below market value

GC 1 Disposals of trading stock at below market value When this section applies (1) This section applies when a person disposes of trading stock for— (a) no consideration: (b) an amount that is less than the market value of the trading stock at the time of disposal. Market value consideration (2) The person is treated as deriving an amount equal to the market value of the trading stock at the time of disposal. Market value expenditure (3) If the person disposes of the trading stock to another person, an amount equal to the market value of the trading stock at the time of disposal is treated as expenditure incurred by the other person in acquiring the trading stock. Shares in trading stock (4) In this section, trading stock includes an interest in trading stock. Exclusions (5) This section does not apply to a disposal of trading stock— (a) under a relationship agreement: (b) by the person to another person who is not associated with them, for use by the other person in a farming, agricultural, or fishing business that is affected by a self-assessed adverse event: (c) under a share-lending arrangement, by a share user to a share supplier or by a share supplier to a share user. Defined in this Act: amount , associated person , , business , relationship agreement , self-assessed adverse event , share , share-lending arrangement , share supplier , share user , , trading stock Compare: 2004 No 35 s GD 1(1), (3), (4) Section GC 1(4)(c): amended (with effect on 26 September 2008), on 6 October 2009, by section 243(1) of the Taxation (International Taxation, Life Insurance, and Remedial Matters) Act 2009 (2009 No 34). Section GC 1(4)(d): added (with effect on 26 September 2008), on 6 October 2009, by section 243(1) of the Taxation (International Taxation, Life Insurance, and Remedial Matters) Act 2009 (2009 No 34). Section GC 1 list of defined terms emissions unit : inserted (with effect on 26 September 2008), on 6 October 2009, by section 243(2)(b) of the Taxation (International Taxation, Life Insurance, and Remedial Matters) Act 2009 (2009 No 34). Section GC 1 list of defined terms qualifying event : repealed (with effect on 26 September 2008), on 6 October 2009, by section 243(2)(a) of the Taxation (International Taxation, Life Insurance, and Remedial Matters) Act 2009 (2009 No 34). Section GC 1 list of defined terms surrender : inserted (with effect on 26 September 2008), on 6 October 2009, by section 243(2)(b) of the Taxation (International Taxation, Life Insurance, and Remedial Matters) Act 2009 (2009 No 34). Section GC 1: substituted (with effect on 1 April 2008), on 7 September 2010, by section 54(1) of the Taxation (Annual Rates, Trans-Tasman Savings Portability, KiwiSaver, and Remedial Matters) Act 2010 (2010 No 109).