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Interpretation statement IS 18/05: Income tax - donee organisations – meaning of wholly or mainly applying funds to specified purposes in New Zealand concerns donee organisations under s LD 3(2)(a) of the Income Tax Act 2007.

It applies to organisations applying funds to charitable, benevolent, philanthropic, or cultural purposes within New Zealand and to other purposes (for example, overseas purposes). It doesn't apply to organisations listed in schedule 32 of the Act.

The statement clarifies the interpretation of these requirements.

It also explains our "safe harbour" approach to administering this requirement. We will generally accept that an organisation meeting the minimum safe harbour percentage of 75% has met the requirement without asking you any more questions.

The statement is accompanied by IS 18/05 - fact sheet - applying the "safe harbour" approach. The fact sheet sets out the most important information from IS 18/05 without the legal details. It includes examples of when funds are considered to be applied to specified purposes within New Zealand, and an example of the safe harbour calculation.

Interpretation statements