Tax losses Flashcards
1
Q
What can we do with a tax loss?
A
Subtract from net income in the future year
Make available gto another company
2
Q
What do we need to carry forward tax loss?
A
SH continuity of >49%
3
Q
What is shareholder continuity?
A
Minimum voting rights >49%
4
Q
When is the continuity period?
A
Start of tax year loss incurred and end of tax year loss used
5
Q
What are voting rights?
A
Percentage SH decision-making rights person holds
6
Q
What if rights vary?
A
Use a weighted average
7
Q
What if a persons voting rights change?
A
Use the lowest voting right during continuity period
8
Q
What are the requirements to make a tax loss available to another company?
A
Common ownership >66%
Loss company Incorporated in NZ
Loss Company has continuity of ownership
Loss available < NI of profit company
