✨ Tax Determinations
29 NOVEMBER 2012 NEW ZEALAND GAZETTE, No. 142 4165
- Schedule of expected assessable income from ABD for NZC at purchase date on 1 July 2009
| Taxable income | 2010 | 2011 | 2012 | 2013 | 2014 | 2015 | 2016 | Total |
|---|---|---|---|---|---|---|---|---|
| Original forecast cash (OF) | 1,068,000 | 582,000 | 274,000 | 58,000 | 18,000 | 0 | 0 | 2,000,000 |
| Actual cash (AC) | 1,106,000 | 600,000 | 293,000 | 88,000 | 20,800 | 6,800 | 500 | 2,115,100 |
| Actual cash (AC) | 1,106,000 | 600,000 | 293,000 | 88,000 | 20,800 | 6,800 | 500 | 2,115,100 |
| Less (PC x OF/TECC) | 534,000 | 291,000 | 137,000 | 29,000 | 9,000 | 0 | 0 | 1,000,000 |
| Equals assessable income (AI) | 572,000 | 309,000 | 156,000 | 59,000 | 11,800 | 6,800 | 500 | 1,115,100 |
- NZC and NZC-2 form consolidated group commencing 30 May 2012
Taxable income of NZC for pre-consolidation period 1 July 2011 to 29 May 2012 (inclusive)
AC = 267,383 (for this example the amount is based on 334 days divided by 366 days; NZC must use actual cash collected)
(PC x OF/TECC) x 334/366 days = 125,022
| Taxable income NZC | 2010 | 2011 | 2012 | 2013 | 2014 | 2015 | 2016 | Total |
|---|---|---|---|---|---|---|---|---|
| Original forecast cash (OF) | 1,068,000 | 582,000 | 274,000 | 58,000 | 18,000 | 0 | 0 | 2,000,000 |
| Actual cash (AC) | 1,106,000 | 600,000 | 267,383 | 0 | 0 | 0 | 0 | 1,973,383 |
| Actual cash (AC) | 1,106,000 | 600,000 | 267,383 | 0 | 0 | 0 | 0 | 1,973,383 |
| Less (PC x OF/TECC) | 534,000 | 291,000 | 125,022 | 0 | 0 | 0 | 0 | 950,022 |
| Equals assessable income (AI) | 572,000 | 309,000 | 142,361 | 0 | 0 | 0 | 0 | 1,023,361 |
- PDLs transferred from NZC to NZC-2 on 1 June 2012
Base price adjustment to be calculated by NZC on 1 June 2012 (for two days since consolidated group formed)
BPA = C – I + E + AR = (1,974,984 + 49,229 – 1,000,000) – 1,973,383 + 950,022 + 0
BPA = 852
Where:
AC = 1,601 (for this example the amount is based on 2/366 days; actual cash collected to be used by NZC)
(PC x OF/TECC) x 2/366 days = 749
Consideration for transfer = 1,000,000 – (825,000 + (137,000 x 336/366)) = 49,229
- Taxable income of NZC-2 from 1 June 2012
For 2012 income year ended 30 June 2012:
AC = 24,016 (for this example the amount is based on 30/366 days; actual cash collected to be used by NZC-2)
(PC x OF/TECC) x 30/366 days = 11,229
| Taxable income NZC-2 | 2010 | 2011 | 2012 | 2013 | 2014 | 2015 | 2016 | Total |
|---|---|---|---|---|---|---|---|---|
| Original forecast cash (OF) | 1,068,000 | 582,000 | 274,000 | 58,000 | 18,000 | 0 | 0 | 2,000,000 |
| Actual cash (AC) | 0 | 0 | 24,016 | 88,000 | 20,800 | 6,800 | 500 | 140,116 |
| Actual cash (AC) | 0 | 0 | 24,016 | 88,000 | 20,800 | 6,800 | 500 | 140,116 |
| Less (PC x OF/TECC) | 0 | 0 | 11,229 | 29,000 | 9,000 | 0 | 0 | 49,229 |
| Equals assessable income (AI) | 0 | 0 | 12,787 | 59,000 | 11,800 | 6,800 | 500 | 90,887 |
Summary
NZC 2012 assessable income = 142,361 (to be returned in separate tax return)
Consolidated Group 2012 assessable income = 13,639
= 852 (NZC) + 12,787 (NZC-2)
Reconciliation
Total assessable income for 2012 income year = 156,000
Total estimated assessable income for 2012 = 156,000 (originally forecast by NZC when ABDs acquired)
This determination is signed by me on the 9th day of November 2012.
HOWARD DAVIS, Director (Taxpayer Rulings).
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NZ Gazette 2012, No 142
✨ LLM interpretation of page content
💰
Special Determination S23: Transfer of Acquired Bad Debts
(continued from previous page)
💰 Finance & RevenueTax Administration, Bad Debts, Transfer, Consolidated Group, Income Tax Act 2007
- HOWARD DAVIS, Director (Taxpayer Rulings)