Employee Income

Question 1

What section of the ITA governs visits by non-resident employees for 92 days or less?

Answer 1

CW 19

Question 2

What is the title for section CW 19 of the ITA?

Answer 2

Amounts derived during short term visits.

Question 3

What is the first requirement for income derived by a non-resident employee to be exempt income?

Answer 3

That the visit is for 92 days or less, counting the day or arrival and the day of departure as a whole day.

Question 4

What is the second requirement for income derived by a non-resident employee to be exempt income?

Answer 4

That the person is in New Zealand for 92 days or fewer in any 12-month period, including the period of the visit.

Question 5

What is the third requirement for income derived by a non-resident employee to be exempt income?

Answer 5

The services are performed for or on behalf of someone who is not resident in New Zealand.

Question 6

What is the fourth requirement for income derived by a non-resident employee to be exempt income?

Answer 6

That the amount derived from the personal or professional services is chargeable in the country or territory in which the person is resident with a tax that is substantially the same as that imposed by the ITA.

Question 7

What does the Commissioner require of non-resident companies with respect to non-resident employees?

Answer 7

That they deduct PAYE from their wages or salary irrespective of whether he or she spends 92 days working in New Zealand, until the employee’s right to relief can be established to the Commissioner’s satisfaction.

Question 8

What might the Commissioner accept as an alternative to the withholding of PAYE of a non-resident employee, from an employer or PAYE intermediary?

Answer 8

A bond or some other sort of security.

Question 9

What are (foreign employee) tax equalisation payments designed to reimburse?

Answer 9

The difference between the hypothetical home country tax on the total remuneration from employment and actual income tax payable calculated on home country equivalent remuneration “outside” income and taxable allowances.

Question 10

Foreign employee tax equalisation payments are designed to reimburse the difference between the _________ home country tax on the total remuneration from employment and actual income tax payable calculated on home country equivalent remuneration “outside” income and taxable allowances.

Answer 10

hypothetical

Question 11

Foreign employee tax equalisation payments are designed to reimburse the difference between the hypothetical ________ country tax on the total remuneration from employment and actual income tax payable calculated on home country equivalent remuneration “outside” income and taxable allowances.

Answer 11

home

Question 12

Foreign employee tax equalisation payments are designed to reimburse the difference between the hypothetical home country tax on the ________ remuneration from employment and actual income tax payable calculated on home country equivalent remuneration “outside” income and taxable allowances.

Answer 12

total

Question 13

Foreign employee tax equalisation payments are designed to reimburse the difference between the hypothetical home country tax on the total __________ from employment and actual income tax payable calculated on home country equivalent remuneration “outside” income and taxable allowances.

Answer 13

remuneration

Question 14

Foreign employee tax equalisation payments are designed to reimburse the difference between the hypothetical home country tax on the total remuneration from employment and ________ income tax payable calculated on home country equivalent remuneration “outside” income and taxable allowances.

Answer 14

actual

Question 15

What kind of accounts are most tax equalisation payments to non-resident employees operated through?

Answer 15

Accounts opened for each employee.

Question 16

How often are most (non-resident employee) instalments of credits (or payments in) to tax equalisation accounts made?

Answer 16

Monthly

Question 17

How much are the (non-resident employee) installments of credits (or payments in) to tax equalisation accounts?

Answer 17

The hypothetical figure in monthly installments.

Question 18

What is the name for the final adjustment payment to the tax equalisation accounts of non-resident employees.

Answer 18

Tax equalisation credit

Question 19

What are the payments out of the tax equalisation accounts of non-resident employees called?

Answer 19

New Zealand tax installments.

Question 20

When do non-resident employees receive the equalisation payments to which payments relate in their tax equalisation accounts?

Answer 20

The year after the year to which the payments relate.

Question 21

As the non-resident employees receive the equalisation payments to which payments relate in their tax equalisation accounts in the following year, when do the PAYE obligations with regards to those payments occur?

Answer 21

In the following year.

Question 22

What case relates to the equalisation payments to non-resident employees from tax equalisation accounts being taxable in the year they were made?

Answer 22

Dow Chemical Overseas Management Co v CIR [1994]

Question 23

What section of the ITA relates to bonds given by employers with respect to non-resident employees?

Answer 23

Section RD 23

Question 24

When does section RD 23 of the ITA apply?

Answer 24

When it cannot be reasonably determined at the time an employer or PAYE intermediary is required to withhold the amount of tax for a PAYE income payment, whether the amount will be exempt income under section CW 19 (Amounts derived during a short-term visit) or a double tax agreement.

Question 25

Section RD 23 applies when it cannot be reasonably determined at the time an employer or ______ is required to withhold the amount of tax for a PAYE income payment, whether the amount will be exempt income under section CW 19 (Amounts derived during a short-term visit) or a double tax agreement.

Answer 25

PAYE intermediary

Question 26

Section RD 23 applies when it cannot be reasonably determined at the time an employer or PAYE _________ is required to withhold the amount of tax for a PAYE income payment, whether the amount will be exempt income under section CW 19 (Amounts derived during a short-term visit) or a double tax agreement

Answer 26

Intermediaries

Question 27

Section RD 23 applies when it cannot be reasonably determined at the time an employer or PAYE intermediary is required to withhold the amount of tax for a _______ income payment, whether the amount will be exempt income under section CW 19 (Amounts derived during a short-term visit) or a double tax agreement.

Answer 27

PAYE

Question 28

Section RD 23 applies when it cannot be reasonably determined at the time an employer or PAYE intermediary is required to withhold the amount of tax for a PAYE income payment, whether the amount will be _______ income under section CW 19 (Amounts derived during a short-term visit) or a double tax agreement.

Answer 28

Exempt

Question 29

Section RD 23 applies when it cannot be reasonably determined at the time an employer or PAYE intermediary is required to withhold the amount of tax for a PAYE income payment, whether the amount will be exempt income under section _____ (Amounts derived during a short-term visit) or a double tax agreement.

Answer 29

CW 19

Question 30

Section RD 23 applies when it cannot be reasonably determined at the time an employer or PAYE intermediary is required to withhold the amount of tax for a PAYE income payment, whether the amount will be exempt income under section CW 19 (Amounts derived during a short-term visit) or a ______________.

Answer 30

double tax agreement

Question 31

What exemption is contained in section CW 19 of the ITA?

Answer 31

The 92-day rule.