The long awaited Taxation (Annual Rates for 2016–17, Closely Held Companies, and Remedial Matters) Bill passed its third reading in Parliament this week.

This will be of some relief to those wishing to utilise the new provisions, which are quite wide ranging in their impacts.

As the name suggests the big ticket items include changes which apply to Closely Held Companies with a particular focus on LTC’s. However also look out for some of the smaller changes such as in relation to aircraft overhaul expenditure, and the changes to FBT and specified insurance premiums which could also have an impact going forward.

Other changes include:

  • Changes to the related-parties debt remission rules
  • Changes to NRWT
  • Simplifying the look-through company rules and the dividend rules as they apply to closely held companies
  • Adjustments to the tainted capital gains rules
  • Allowing loss grouping and imputation credit transfers
  • Other ‘taxpayer-friendly’ changes to the GST rules, such as enabling businesses to deduct GST associated with the costs of raising capital 

Special reports on changes to the NRWT rules, closely held companies, and GST services connected with land, will be published soon, while full coverage of the new legislation will be published in an upcoming Tax Information Bulletin.