Residence

Sections MC 5 and MD 7 of the Income Tax Act 2007

Sections MC 5(2)(a) and MD 7(2)(a), which relate to the residence requirements for Working for Families tax credits have been replaced to better reflect the policy intent of this requirement. The change makes it clearer when the requirement for tax residence applies in relation to Working for Families tax credits.
The test for residence is that the person has been:

• both a New Zealand resident (as defined in section MA 8) and present in New Zealand for a continuous period of 12 months at any time; and
• tax resident in New Zealand under section YD 1 (the tax residence test for a natural person) on the days for which a Working for Families tax credit arises.

Application date

The change applies from 1 April 2008.