Tax avoidance and the interpretation of the general anti-avoidance provisions sections BG 1 and GA 1 of the Income Tax Act 2007
The statement explains the Commissioner’s view of the law on tax avoidance in Aotearoa New Zealand. It is based on and reflects the view of the Supreme Court as set out in Ben Nevis Forestry Ventures Ltd v Commissioner of Inland Revenue [2008] NZSC 115, and applied in Penny v CIR [2011] NZSC 95 and Frucor Suntory New Zealand Ltd v CIR [2022] NZSC 113.
The statement sets out the Commissioner’s approach to applying section BG 1. The statement also explains how the Commissioner, under section GA 1, may counteract any tax advantage that a person obtains from or under a tax avoidance arrangement.
The statement is also relevant to the general anti-avoidance provision in the Goods and Services Tax Act 1985 (section 76).
This item replaces IS 13/01: Tax avoidance and the interpretation of ss BG 1 and GA 1 of the Income Tax Act 2007.
Goods and Services Tax Act 1985, s 76
Interpretation Act 1999, ss 5(1)
Income Tax Act 1976, s 99
Income Tax Act 1994, ss BG 1, GB 1 , Sch 1
Income Tax Act 2004, ss BG 1, GB 1
Income Tax Act 2007, ss BG 1, BH 1(4), GA 1, YA 1, YA 2(4)
Land and Income Tax Act 1954, s 108
Land and Income Tax Amendment Act (No. 2) 1974, s 9
Legislation Act 2019, s 10(1)
Tax Administration Act 1994, s 113
A Taxpayer v CIR (1997) 18 NZTC 13,350 (CA)
Accent Management Ltd v CIR (2005) 22 NZTC 19,027 (HC)
Alesco New Zealand Ltd v CIR [2013] NZCA 40, [2013] 2 NZLR 175
AMP Life Ltd v CIR (2000) 19 NZTC 15,940 (HC)
Ashton v CIR [1975] 2 NZLR 717 (PC)
Aylwin; R v [2008] NZCA 154
Ben Nevis Forestry Ventures Ltd v CIR [2008] NZSC 115, [2009] 2 NZLR 289
BNZ Investments Ltd v CIR (2000) 19 NZTC 15,732 (HC) [BNZ Investments No 1 (HC)]
BNZ Investments Ltd; CIR v [2002] 1 NZLR 450 (CA) [BNZ Investments No 1 (CA)]
BNZ Investments Ltd v CIR (2009) 24 NZTC 23,582 (HC) [BNZ Investments No 2 (HC)]
Buckley & Young v CIR [1978] 2 NZLR 485 (CA)
Bunting v FCT 89 ATC 5,245 (FCAFC)
Case M72 (1990) 12 NZTC 2,419
Case S95 (1996) 17 NZTC 7,593
Case X1 (2005) 22 NZTC 12,001
Cecil Bros Pty Ltd v FCT (1964) 111 CLR 430 (HCA)
Ch’elle Properties (NZ) Ltd v CIR [2007] NZCA 256, [2008] 2 NZLR 342
Challenge Corporation Ltd v CIR [1986] 2 NZLR 513 (CA)
Challenge Corporation Ltd v CIR [1986] 2 NZLR 513 (PC)
Cullen Group Ltd v CIR [2019] NZHC 404
Dandelion Investments Ltd v CIR [2003] 1 NZLR 600 (CA)
Duke of Westminster; Inland Revenue Commissioners v [1936] AC 1 (HL)
Education Administration Ltd v CIR (2010) 24 NZTC 24,238 (HC)
Elmiger v CIR [1966] NZLR 683 (SC)
Erris Promotions Ltd v CIR (2003) 21 NZTC 18,330 (HC)
Europa Oil (NZ) Ltd; CIR v [1971] NZLR 641 (PC) [Europa No 1 (PC)]
Europa Oil (NZ) Ltd v CIR [1976] 1 NZLR 546 (PC) [Europa No 2 (PC)]
Finnigan v CIR (1995) 17 NZTC 12,170 (CA)
Fonterra Co operative Group Ltd; v Commerce Commission [2007] NZSC 36, [2007] 3 NZLR 767
Frucor Suntory New Zealand Ltd v CIR [2022] NZSC 113
Furniss (Inspector of Taxes) v Dawson [1984] AC 474 (HL)
Glenharrow Holdings Ltd v CIR [2008] NZSC 116, [2009] 2 NZLR 359
Gulland; FCT v (1985) 160 CLR 55 (HCA)
Hadlee v CIR [1989] 2 NZLR 447 (HC)
Hollyock v FCT (1971) 125 CLR 647 (HCA)
Krukziener v CIR (No 3) (2010) 24 NZTC 24,563 (HC)
MacNiven (HM Inspector of Taxes) v Westmoreland Investments Ltd [2001] UKHL 6, [2003] 1 AC 311
Mangin v CIR [1971] NZLR 591 (PC)
Marac Life Assurance Ltd v CIR [1986] 1 NZLR 694 (CA)
Marx v CIR [1970] NZLR 182 (CA)
Miller v CIR (No 1) (1997) 18 NZTC 13,001 (HC)
Miller v CIR [1999] 1 NZLR 275 (CA)
Miller v CIR [2001] 3 NZLR 316 (PC)
Mills v Dowdall [1983] NZLR 154 (CA)
Mullens v FCT (1976) 135 CLR 290 (HCA)
Newton v Commissioner of Taxation [1958] AC 450 (PC)
Northland Milk Vendors Association v Northern Milk Ltd [1988] 1 NZLR 530 (CA)
Penny; CIR v [2010] NZCA 231, [2010] 3 NZLR 360
Penny v CIR [2011] NZSC 95, [2012] 1 NZLR 433
Peterson v CIR (No 2) (2002) 20 NZTC 17,761 (HC)
Peterson v CIR [2005] UKPC 5, [2006] 3 NZLR 433 (PC)
Roberts; CIR v [2019] NZCA 654
Russell v CIR (No 2) (2010) 24 NZTC 24,463 (HC)
Russell v CIR [2012] NZCA 128, (2012) 25 NZTC 20–120
Sovereign Assurance Company Ltd v CIR [2012] NZHC 1760, (2012) 25 NZTC 20–138
Stiassny v CIR [2012] NZSC 106, [2013] 1 NZLR 453
Tayles v CIR [1982] 2 NZLR 726 (CA)
Terminals (NZ) Ltd v Comptroller of Customs [2013] NZSC 139, [2014] 1 NZLR 121
W T Ramsay Ltd v Inland Revenue Commissioners [1982] AC 300 (HL)
Westpac Banking Corporation v CIR (2009) 24 NZTC 23,834 (HC)
White v CIR (2010) NZTC 24,600
Wisheart, Macnab and Kidd v CIR [1972] NZLR 319 (CA)
WP Keighery Pty Ltd v FCT (1957) 100 CLR 66 (HCA)