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Accrual determinations

The Commissioner may determine certain matters relating to financial arrangements. A taxpayer may wish to apply for a determination to ascertain the tax treatment of a particular financial arrangement.

Accrual determination fees

This sets out the application and processing fees for applications received on or after 1 October 1999.

Special Determination S56: Treatment of prepayments for services using IFRS

This determination applies in respect of prepayments received by LP from customers under customer contracts, and of prepayments made by LP to Subsidiaries under supporting contracts on back-to-back terms. Specifically, it relates to the value of the consideration for one of the customer contracts and its supporting contract, and the spreading of any interest income or expenditure for two of the customer contracts and their supporting contracts under the financial arrangements rules.

Special Determination S55: Valuation of Shares Issued by Bank on Conversion

Special Determination S55: Valuation of Shares Issued by Bank on Conversion. This Determination is signed on the 8th day of September 2017.

Special Determination S54: Application of financial arrangements rules to Investors in the Lifetime Income Fund

Special Determination S54: Application of financial arrangements rules to Investors in the Lifetime Income Fund.This Determination is signed on the 18th day of August 2017.

Special Determination S53: Application of the financial arrangements rules to a public-private partnership agreement

This determination relates to an arrangement involving the finance, design, construction and on-going provision of operational services in respect of the Facilities by a limited partnership under a public-private partnership agreement with the Crown.

Special Determination S52: Valuation of Shares Issued by Bank following a Non-Viability Trigger Event

This determination relates to a funding transaction involving the issue of Notes by the Bank to wholesale investors pursuant to a Deed Poll. The Notes will contain a conversion mechanism, whereby the Bank will immediately and irrevocably convert Notes into ordinary shares in Bank upon the occurrence of a Non-Viability Trigger Event, in order to allow them to be recognised as Tier 2 capital for the purposes of the Reserve Bank of New Zealand framework relating to the capital adequacy of banks.

Special Determination S51: Subordinated Convertible Note in respect of a Limited Partnership Interest in a Public–Private Partnership

This determination relates to the issue of subordinated convertible notes by a limited partnership to two of its limited partners. This determination prescribes the method for determining the amounts that are solely attributable to the excepted financial arrangement, as well as the method for spreading the income and expenditure under the financial arrangements rules.

Special Determination S50: Application of the financial arrangements rules to the D&C Phase of a Public-Private Partnership

This determination relates to payments received by a limited partnership for the design and construction of a Facility under a public-private partnership agreement with the Crown.

Special Determination S49: Application of the financial arrangements rules to a Public–Private Partnership

This determination relates to an arrangement involving the finance, design, construction and provision of ongoing asset management and maintenance services in respect of a Facility by a limited partnership under a public–private partnership agreement with the Crown.

Special Determination S48: Spreading Method to be applied by Bank, valuation of shares issued by Bank on Conversion and solely attributable

This determination relates to a funding transaction involving the issue of Notes by Bank to Parent pursuant to a Deed Poll. The Notes will contain a conversion mechanism to allow them to be recognised as Additional Tier 1 capital for the purposes of the Reserve Bank of New Zealand framework relating to the capital adequacy of banks.

Special Determination S47: Valuation of shares issued by Bank and HoldCo following a non-viability trigger event

This determination relates to a funding transaction involving the issue of Notes by the Bank to the public pursuant to a Deed Poll. The Notes will contain an exchange mechanism, to allow them to be recognised as Tier 2 capital for the purposes of the Reserve Bank of New Zealand and Australian Prudential Authority frameworks relating to the capital adequacy of banks. This determination applies where shares are issued by Bank and HoldCo following a non-viability trigger event, to determine the value of the shares for the purposes of the financial arrangements rules.

Special Determination S46: Valuation of shares issued by bank on conversion of notes

This determination relates to a funding transaction involving the issue of Notes by the Bank to the New Zealand branch of its Australian parent company. The Notes will contain a conversion mechanism, in order to allow them to be recognised as Additional Tier 1 capital for the purposes of the Reserve Bank of New Zealand framework relating to the capital adequacy of banks. This determination applies when shares are issued by Bank to the New Zealand branch of the Australian parent on conversion to determine the value of the shares for the purposes of the financial arrangements rules.

Special Determination S45: Spreading of income and expenditure under varied intra-group debt arrangements

This Special Determination S45 relates to spreading of income and expenditure under varied intra-group debt arrangements. This Determination is signed on the 21st day of December 2015.

Special Determination S44: Spreading of income and expenditure under varied participants' debt arrangements

This Special Determination S44 relates to spreading of income and expenditure under varied participants debt arrangements. This Determination is signed on 21st day of December 2015.

Special Determination S43: Valuation of shares issued by Bank and NZHoldCo following a non-viability trigger event

This determination relates to a funding transaction involving the issue of Notes by Bank to the public pursuant to a Deed Poll. The Notes will contain a conversion mechanism to allow them to be recognised as Tier 2 capital for the purposes of the Reserve Bank of New Zealand and Australian Prudential Regulation Authority frameworks relating to the capital adequacy of banks. This determination applies if shares are issued by Bank and NZHoldCo following a Non-Viability Trigger Event to determine the value of the shares for the purposes of the financial arrangements rules.

Special Determination S29A: Application of the financial arrangements rules to a public-private partnership

This determination varies and replaces Special Determination S29: Application of the financial arrangements rules to a public-private partnership following a change of partners in the limited partnership.

Special Determination S28A: Application of the financial arrangements rules to the D&C phase in a public-private partnership

This determination varies and replaces Special Determination S28: Application of the financial arrangements rules to the D&C Phase in a public-private partnership following a change of partners in the limited partnership.

Special Determination S27A: Convertible notes in respect of a limited partnership interest

Special Determination S27A: Convertible notes in respect of a limited partnership interest. This Determination is signed on the 8th September 2015.

Special Determination S42: Application of the financial arrangements rules to the D&C Phase of a public-private partnership agreement.

This determination relates to payments received by a limited partnership for the design and construction of a prison under a public-private partnership agreement with the Crown.

Special Determination S41: Application of the financial arrangements rules to a public-private partnership agreement

This determination relates to an arrangement involving the finance, design, construction and on-going provision of asset management and facilities maintenance services in respect of a prison by a limited partnership under a public-private partnership agreement with the Crown.

Special Determination S40: Spreading method to be used by Infrastructure Provider in respect of the Provision of Services Agreement and valuation of shares issued under that Agreement

This determination relates to a share incentive scheme established by a company under which a major customer commits to increase the volume of throughput which is processed by the company. If the customer achieves the growth targets the customer receives new shares in the company.

Special Determination S39: Valuation of shares issued by bank following a non-viability trigger event

This determination relates to a funding transaction involving the issue of Notes by Bank to Parent. The notes will contain a conversion mechanism, in order to allow them to be recognised as Tier 2 capital for the purposes of the Reserve Bank of New Zealand framework relating to the capital adequacy of banks. This determination applies in the situation that shares are issued by Bank to Parent following a Non-Viability Trigger Event, to determine the value of the shares for the purposes of the financial arrangement rules.

Special Determination S38: Application of financial arrangements rules to loans by NZ Dairy Farming Trusts to New Zealand resident farmers

This determination relates to loans from NZ Dairy Farming Trusts to New Zealand resident famers. Under the loans, farmers will pay an establishment fee, milk-priced interest, land-priced interest, and early repayment interest (if a loan is repaid before the agreed maturity date). This determination specifies that the milk-priced interest payable or accrued by a farmer in an income year together with a portion of the establishment fee and a portion of the estimated land-price interest is income for the trust in the income year and is expenditure for the farmer in the income year.

Special Determination S37: Application of the financial arrangements rules to the D&C Phase of a public-private partnership agreement

This determination relates to payments received by a limited partnership for the design and construction of Facilities under a public-private partnership agreement with the Crown.

Special Determination S36: Application of the financial arrangements rules to a public-private partnership agreement

This determination relates to an arrangement involving the finance, design, construction and on-going provision of operation and maintenance services in respect of the Facilities by a limited partnership under a public-private partnership agreement with the Crown.

Special Determination S35: Valuation of Shares issued by Bank following a conversion event.

This determination relates to a funding transaction involving the issue of Notes by Bank to Issuer. The Notes will contain a conversion mechanism, to allow them to be recognised as Additional Tier 1 capital for the purposes of the Reserve Bank of New Zealand frameworks relating to the capital adequacy of banks. This determination applies when shares are issued by Bank following a Trigger Event, to determine the value of the shares for the purposes of the financial arrangement rules.

Special Determination S34: Spreading Method to Be Used by Bank in Respect of the Notes and Valuation of Shares Issued by Bank and NZHoldCo On Conversion

This determination relates to a funding transaction involving the issue of Notes by the Bank to the public under a Notes Deed Poll. The Notes will contain an exchange mechanism, so they can be recognised as Additional Tier 1 capital for the purposes of the Reserve Bank of New Zealand and Australian Prudential Regulation Authority frameworks relating to the capital adequacy of banks.

Special Determination S33 : Application of the financial arrangements rules to the long term incentive plan established for senior executives of New Zealand Company Limited

This determination relates to a long-term incentive plan for senior executives of a company. Under the plan, amounts will be lent to the executives to enable them to acquire shares in the company. This determination prescribes amounts that are solely attributable to excepted financial arrangements.

Special Determination S32: Spreading method to be used by bank in respect of the notes and the value of shares issued by bank on conversion.

This determination relates to a funding transaction involving the issue of Notes by the Bank to its New Zealand branch of its Australian parent company. The Notes will contain a conversion mechanism, in order to allow them to be recognised as Additional Tier 1 capital for the purposes of the Reserve Bank of New Zealand frameworks relating to the capital adequacy of banks.

Special Determination S31: Application of financial arrangements rules to investors in the Lifetime Income Fund

The Arrangement is the Lifetime Income fund (the Fund), which is a retirement product members of the general public can invest their retirement savings in. The Fund will manage the investment in a similar manner to a KiwiSaver scheme through the Balanced Portfolio which will invest in low cost share and fixed interest index funds. The Fund will also manage distributions to provide income for the Investor over their retirement lifetime (from age 65 onwards). The Determination sets out that the Arrangement is a financial arrangement under s EW 3. The units in the Fund are excepted financial arrangements under s EW 5(13) and the annuity provided is an excepted financial arrangement under s EW 5(2).

Special Determination S30: Spreading method to be used by a company and growers for a share incentive scheme and valuation of shares issued under the scheme

This determination relates to a share incentive scheme established by a company, under which eligible produce growers commit to supplying produce for a three-year period in return for an entitlement to receive shares in the company at the end of each growing season.

Special Determination S29: Application of the financial arrangements rules to a public-private partnership

This determination relates to an arrangement involving the finance, design, construction and on-going provision of operation and maintenance services in respect of a facility by a limited partnership under a public-private partnership agreement (the Project Agreement) with the Crown. This determination was varied and replaced by Determination s29A on 8 September 2015. It therefore applies for the period from 25 July 2014 to 8 September 2015.

Special Determination S28: Application of the financial arrangements rules to the D&C Phase in a public-private partnership

This determination relates to a payment for the design and construction of a facility by a limited partnership under a public-private partnership agreement with the Crown. This determination was varied and replaced by Determination s28A on 8 September 2015. It therefore applies for the period from 25 July 2014 to 8 September 2015.

Special Determination S27: Convertible Notes in respect of a limited partnership interest

This determination relates to the subordinated convertible notes issued by the Holding Partnership to Limited Partner A. They are being issued to provide equity funding to the Holding Partnership as part of an arrangement involving the finance, design, construction and ongoing operation of the facility by the Partnership under a public-private partnership agreement with the Crown. This determination was varied and replaced by Determination s27A on 8 September 2015. It therefore applies for the period from 25 July 2014 to 8 September 2015.

Special Determination S26: Valuation of Shares Issued by Bank Following a Trigger Event

This determination relates to a funding transaction involving the issue of Notes by Bank to Issuer. The Notes will contain a conversion mechanism, in order to allow them to be recognised as Additional Tier 1 or Tier 2 capital for the purposes of the Reserve Bank of New Zealand frameworks relating to the capital adequacy of banks. This determination applies in the situation that shares are issued by Bank following a Non-Viability Trigger Event, to determine the value of the shares for the purposes of the financial arrangement rules.

Special Determination S25: Valuation of Shares Issued by Bank and HoldCo Following a Non-Viability Trigger Event

This determination relates to a funding transaction involving the issue of Notes by a Bank to the public pursuant to a Deed Poll. The Notes will contain an exchange mechanism, in order to allow them to be recognised as Tier 2 capital for the purposes of the Reserve Bank of New Zealand and Australian Prudential Regulation Authority frameworks relating to the capital adequacy of banks. This determination applies in the situation that shares are issued by Bank and HoldCo following a Non-Viability Trigger Event, to determine the value of the shares for the purposes of the financial arrangement rules.

Special Determination S24: Application of the financial arrangements rules to the sale of shares in Meridian by the Crown

This determination relates to the sale of up to 49% of the ordinary shares in Meridian Energy Limited by the Crown to New Zealand resident retail and institutional investors, pursuant to the terms contained in the combined Investment Statement and Prospectus.

Special Determination S23: Transfer of acquired bad debts by a certain New Zealand company to another New Zealand company in the same consolidated group and the utilisation of a profit emerging basis by the transferee company

This determination relates to the transfer of acquired bad debts from New Zealand Company Limited (NZC) to a newly incorporated company, New Zealand Company (2) Limited (NZC-2). NZC and NZC-2 are members of the same consolidated group at the time the acquired bad debts are transferred.

Special Determination S22: Application of the financial arrangements rules to a public-private partnership

This determination relates to an arrangement involving the design, construction and on-going provision of operation and maintenance services in respect of a prison by a certain company under a public-private partnership agreement with the Crown.

Special Determination S21: Spreading of acquisition cost of agreements for the sale and purchase of services

Special Determination S21: Spreading of acquisition cost of agreements for the sale and purchase of services. Signed on 3rd May 2012.

Special determination S20: Convertible redeemable notes and preference shares

This determination relates to convertible redeemable notes issued by a company (Company A, the Issuer) to another company (Company B, the Noteholder), and to preference shares issued by a third company (Company C).

Special Determination S19: Mandatory conversion convertible notes with consumer price index adjustments to face value

This determination relates to mandatory conversion convertible notes to be issued by a company (the issuer), as a wholly owned special purpose subsidiary of another company (the shareholder), to a third company (the noteholder).

Determination S18: Issue of perpetual non-cumulative shares by NZ Co, and related transactions

This determination relates to an arrangement involving the issue of perpetual non-cumulative shares by a New Zealand company to its parent company.

Special Determination S17: Utilisation of a profit emerging basis for purchased debt ledgers by a certain New Zealand Company Limited

This determination may be cited as Special Determination S17: “Utilisation of a profit emerging basis for acquired bad debts by a certain New Zealand Company Limited”.

Determination S16: Financial arrangement income or expenditure from certain retirement village arrangement

This Determination relates to an Occupation Right Agreement between the Operator and the Resident.

Determination S15: Issue of perpetual non-cumulative shares by BNZIS 2, and related transactions

This determination relates to an arrangement involving the issue of perpetual non-cumulative shares to the public and to National Equities Limited, and is fully described in product ruling BR Prd 09/12.

Cancellation of Determination G30

It should be noted that Determination G30 was withdrawn from use on 1 October 2009 as advised in the Gazette published on 8 October 2009.

Determination E12: Persons excused from complying with section EA 3 of the Income Tax Act 2007

This determination cancels and replaces Determination E11: Persons not required to comply with section EF 1 of the Income Tax Act 1994. This determination is made under section 91AAC of the Tax Administration Act 1994. It determines the extent to which a person is excused from complying with section EA 3 of the Income Tax Act 2007.

Determination S14: Issue of perpetual non-cumulative shares by BNZIS, and related transactions

This determination covers an arrangement involving the issue of perpetual non-cumulative shares by BNZ Income Securities Limited to the public and to National Equities Limited. The arrangement is fully described in product ruling BR Prd 09/02.

Determination G30: Debt securities, finance leases and hire purchase agreements denominated in New Zealand dollars

Determination G30 allows financial institutions that adopt International Financial Reporting Standards (IFRS) to continue to use the same methods of calculating income and expenditure for most financial arrangements as under the previous rules – in particular, where income and expenditure from those financial arrangements were returned under the alternative method to yield to maturity.