Section RC 3 — Income Tax Act 2007: Who is required to pay provisional tax?

RC 3 Who is required to pay provisional tax? Threshold or election (1) A person who is liable to pay provisional tax for a tax year is— (a) a person whose residual income tax for the tax year is more than $2,500; or (b) a person who chooses under section RC 4 to pay provisional tax. Exclusions (2) Despite subsection (1), the following persons do not pay provisional tax: (a) a company that does not have a fixed establishment in New Zealand and is not treated as resident in New Zealand: (b) a person referred to in section 33A(1) of the Tax Administration Act 1994: (c) a non-resident contractor who has not been given an exemption certificate by the Commissioner for the tax year: (d) a multi-rate PIE that does not choose to calculate and pay tax using the provisional tax calculation option under section HM 44 (Provisional tax calculation option). No obligation (3) A person has no obligation to pay provisional tax for a tax year if their residual income tax for the preceding tax year is $2,500 or less. Defined in this Act: Commissioner , company , exemption certificate , fixed establishment , multi-rate PIE , New Zealand , non-resident , non-resident contractor , pay , provisional tax , resident in New Zealand , residual income tax , tax year , Compare: 2004 No 35 ss MB 2 , OB 1 “ provisional taxpayer ” Section RC 3(2)(d): substituted, on 1 April 2010 (applying for the 2010–11 and later income years), by section 498(1) of the Taxation (International Taxation, Life Insurance, and Remedial Matters) Act 2009 (2009 No 34). Section RC 3 list of defined terms multi-rate PIE : inserted, on 1 April 2010, by section 498(2)(b) of the Taxation (International Taxation, Life Insurance, and Remedial Matters) Act 2009 (2009 No 34). Section RC 3 list of defined terms portfolio tax rate entity : repealed, on 1 April 2010, by section 498(2)(a) of the Taxation (International Taxation, Life Insurance, and Remedial Matters) Act 2009 (2009 No 34).