Section OB 60 — Income Tax Act 2007: Imputation credits attached to dividends

OB 60 Imputation credits attached to dividends Attaching imputation credits (1) When an ICA company pays a dividend, it may attach an imputation credit to the dividend. Section OB 63 overrides this section. Retrospective attachment (2) The ICA company may determine that an imputation credit is retrospectively attached to a dividend in the circumstances described in section OB 62 . Imputation ratio for dividend (3) A dividend with an imputation credit attached has an imputation ratio calculated using the formula— credit attached net dividend paid. Definition of items in formula (4) In the formula in subsection (3),— (a) credit attached is the amount of the imputation credit attached to the dividend: (b) net dividend paid is the amount of the dividend paid, excluding the amount of the imputation credit and FDP credit attached. Maximum permitted ratio (5) A dividend with an imputation credit attached must not have an imputation ratio that is more than the maximum permitted ratio calculated under section OA 18(2) (Calculation of maximum permitted ratios). Conversion of AUD dividend (6) A dividend paid in Australian currency by an Australian ICA company must be converted into New Zealand currency, calculated using the formula— Australian dollar value × exchange rate. Definition of items in formula (7) In the formula in subsection (6),— (a) Australian dollar value is the amount of the dividend in Australian dollars: (b) exchange rate is the close of trading spot exchange rate for the Australian dollar on— (i) the day the dividend is declared if that day is no more than 3 months before the dividend is paid; or (ii) the day the dividend is paid if that day is more than 3 months after the dividend is declared. Defined in this Act: amount , Australian ICA company , close of trading spot exchange rate , dividend , FDP credit , ICA company , imputation credit , imputation ratio , income year , maximum permitted ratio , pay , tax year , Compare: 2004 No 35 ss ME 1B , ME 6 , ME 8(1), (2)