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Technical tax area
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Technical tax area: Interpretation guidelines and interpretation statements

Download interpretation guidelines and interpretation statements

  • Interpretation guidelines discuss the Commissioner's approach to the interpretation of a general area of law where there are also taxation implications. For example, IG009: Employee or independent contractor? assists taxpayers to determine their employment status for tax purposes.
     
  • Interpretation statements set out the Commissioner's view of the taxation laws in relation to a particular set of circumstances in cases when a binding public ruling cannot be issued or is considered to be inappropriate.

The table below lists interpretation guidelines and interpretation statements issued in 2017, other interpretations are sorted by the year in which they were issued.


IS 17/08 - IS 17/08: GST - Compulsory zero-rating of land rules (general application)

This Interpretation Statement provides a general overview of the compulsory zero-rating of land (CZR) rules, including practical examples of how the CZR rules work and a flowchart at the end. The statement’s focus is on helping vendors and purchasers get it right from the start, before a transaction including land settles.

Date of issue: 15 September 2017

IS 17/08 - PDF format (431kb | 31 pages)


IS 17/07 - Fringe benefit tax - motor vehicles

This interpretation statement aims to consolidate all the statements we have published on FBT and motor vehicles. A number of these statements related to earlier versions of legislation and use out-dated section references. This interpretation statement brings all the Inland Revenue statements together in one place in a user-friendly format. This should provide taxpayers with increased certainty in understanding their FBT obligations for motor vehicles and lead to better compliance.

Date of issue: 29 August 2017

IS 17/07 - PDF format (1mb | 57 pages)


IS 17/06 - Income tax - application of schedular payment rules to directors’ fees

This interpretation statement discusses how the schedular payment rules apply to payments of directors’ fees. In particular, it covers the situations in which tax must be withheld from directors’ fee payments, and when and how much tax must be withheld and paid to the Commissioner, if withholding is required. It does not discuss the withholding treatment of directors’ fees paid to non-residents.

Date of issue: 18 July 2017

IS 17/06 - PDF format (406kb | 22 pages)


IS 17/05 - Income tax - treatment of New Zealand patents

This interpretation statement considers the income tax treatment of New Zealand patent applications, New Zealand patents and New Zealand patent rights. It updates and replaces the 2006 Interpretation Statement (IS2215 - Income tax treatment of New Zealand patents). This statement updates legislative references to reflect changes to income tax and patents legislation since 2006. It also discusses legislative changes addressing "black hole" expenditure in the Taxation (Annual Rates for 2015-16, Research and Development, and Remedial Matters) Act 2016. Some of the Commissioner’s views have changed because of these legislative changes, and this is discussed in the statement.

Date of issue: 7 June 2017

IS 17/05 - PDF format (493kb | 46 pages)


IS 17/04 - Income tax – computer software acquired for use in a taxpayer’s business

This interpretation statement considers the income tax treatment of software for taxpayers who purchase, lease, licence, develop, or commission software for use in their business. It updates IS 16/01: ”Income tax – computer software acquired for use in a taxpayer’s business”, (published in May 2016) to take account of changes to the Commissioner’s position on the deductibility of feasibility expenditure following the Supreme Court decision in Trustpower Ltd v CIR [2016] NZSC 91.

Date of issue: 11 April 2017

IS 17/04 - PDF format (386kb | 30 pages)


IS 17/03 - Goods and Services Tax – single supply or multiple supplies

This interpretation statement explains how to determine whether the different elements contained in a transaction should be treated as a single composite supply or multiple separate supplies. The statement also considers some situations where specific deeming provisions apply to override the ordinary principles and specify how the supply must be treated.

Date of issue: 11 April 2017

IS 17/03 - PDF format (488kb | 30 pages)


IS 17/02 - Income tax – deductibility of farmhouse expenses

This Interpretation Statement explains that deductions for farmhouse expenses are available only to the extent that they are incurred in carrying on the farming business. This Interpretation Statement replaces a number of older items (some going back to the 1960’s) which allowed deductions which are no longer appropriate.

Where the compliance costs outweighs any likely deduction, the Interpretation Statement allows some sole traders and partners of partnerships to adopt a practical approach. This allows an automatic 20% deduction for farmhouse expenses and 100% deductions for rates and interest. These deductions are allowed when the value of the farmhouse is 20% or less than the total value of the farm.

Date of issue: 23 March 2017

IS 17/02 - PDF format (465kb | 29 pages)


IS 17/01 - Income tax - deductibility of feasibilty expenditure

This item considers the deductibility of feasibility expenditure. It updates and replaces "IS 08/02: Deductibility of feasibility expenditure" Tax Information Bulletin Vol 20, No 6 (July 2008): 12, to take account of the Supreme Court decision Trustpower Ltd v CIR [2016] NZSC 91.

Date of issue: 23 February 2017

IS 17/01 - PDF format (541kb | 41 pages)