Section LJ 6 — Income Tax Act 2007: Taxable distributions and NRWT rules

LJ 6 Taxable distributions and NRWT rules When this section applies (1) This section applies when a person who is a beneficiary of a trust and resident in New Zealand derives a taxable distribution in their capacity as beneficiary of the trust. When credit not allowed (2) The person is not allowed a tax credit in relation to any foreign income tax paid on the taxable distribution unless the tax has substantially the same nature as non-resident withholding tax (NRWT). Amount of credit (3) The person’s tax credit is equal to an amount calculated using the formula— person's taxable distribution × foreign tax paid. total distribution Definition of items in formula (4) In the formula,— (a) person’s taxable distribution is the amount of the taxable distribution derived by the person in their capacity as beneficiary of the trust, including a payment of tax that meets the requirements of subsection (2): (b) total distribution is the total amount of the distribution derived by the person in their capacity as beneficiary of the trust, including a payment of tax that meets the requirements of subsection (2): (c) foreign tax paid is the payment of tax that meets the requirements of subsection (2). Defined in this Act: amount , distribution , foreign income tax , non-resident withholding tax , NRWT , NRWT rules , pay , resident in New Zealand , tax credit , taxable distribution , Compare: 2004 No 35 s LC 1(2)