Remedial amendments: branch equivalent tax accounts of companies

(Clauses 99, 103, 112 and 116)

Summary of proposed amendment

Minor changes to the Income Tax Act 2007 are included in this Bill to ensure that branch equivalent tax accounts (BETAs) cannot go into credit.

Application date

Income years beginning on or after 1 July 2009.

Key features

Following the changes in the Taxation (International Taxation, Life Insurance, and Remedial Matters) Act 2009, all credit balances in branch equivalent tax accounts of companies (BETAs) were cancelled.

However, debit balances remained for a transitional period of two years. As these debit balances are used, credits are put into the account to cancel them out.

Minor changes to the rules are included in this Bill to ensure that BETAs cannot go back into an overall credit balance as a result of these credits.

Credits arising under sections OE 6, OE 9, OP 100 and OP 103 are now limited to the amount of an overall debit balance in the account at the time.