Section 786 — Income Tax Act 2007: Recovery of tax where consideration receivable by person not assessed

Recovery of tax where consideration receivable by person not assessed 786 1 This section applies if a person (“A”) is assessed to tax under this Chapter in respect of consideration receivable by another person (“B”).

2 Consideration is not regarded as having become receivable by B for this purpose until B can effectively enjoy or dispose of it.

3 A is entitled to recover from B any part of the tax which A has paid.

4 If any part of the tax remains unpaid at the end of the period of 6 months beginning with the date when it became due and payable, it is recoverable from B as if B were the person assessed.

5 Subsection (4) does not affect the right to recover the tax from A.

6 For the purposes of this section, any income which an individual is treated as having as a result of this Chapter (the “occupation income”) is treated as the highest part of the individual's total income.

7 But if in the tax year—

a more than one capital amount is treated as the individual's occupation income, or b the individual is also treated as having income as a result of Chapter 3 (transactions in land), only a just and reasonable proportion of each capital amount treated as occupation income is to be treated as the highest part of the individual's total income.

8 See section 1012 for the relationship between—

a the rules in subsections (6) and (7),

and b other rules requiring particular income to be treated as the highest part of a person's total income.