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Technical tax area Ngā tūmomo whakataunga me ngā aratohu

Taxation (Canterbury Earthquake Measures) Act 2011

The Taxation (Canterbury Earthquake Measures) Bill was introduced into Parliament on 4 May 2011 and contained measures to deal with taxation issues arising from the earthquakes that occurred on 4 September 2010 and 22 February 2011 in the Canterbury region. The bill was passed under urgency on 19 May 2011, with the resulting Act receiving Royal assent on 24 May 2011.

The new Act amends the Income Tax Act 2007, Tax Administration Act 1994, Estate and Gift Duties Act 1968 and the Taxation (Budget Measures) Act 2010.

Tax relief for employers' welfare contributions to employees

Changes included in the Taxation (Canterbury Earthquake Measures) Act 2011 provide an exemption for certain welfare contributions made by an employer to employees as a result of the two major Canterbury earthquakes. The exemption may be applied to:

  • accommodation;
  • "sundry" fringe benefits when the employer cannot reasonably estimate which employees received which benefits; and
  • the first $3,200 per earthquake of monetary remuneration and fringe benefits of the kind where the employer can reasonably be expected to know which employees received which benefits.

Working for Families: family scheme income - "other payment" category

The "other payments"category in the definition of "family scheme income" has been amended to ensure payments given to support people affected by events such as the Canterbury earthquakes in September 2010 and February 2011, and other similar events in the future, are excluded from the definition of family scheme income for up to 12 months.

Extension of the redundancy tax credit

As a consequence of the 22 February 2011 earthquake, the cancellation of the redundancy tax credit has been further delayed so that it will now apply to redundancies after 30 September 2011. If the redundancy is on or before 30 September 2011, the tax credit will apply according to subpart ML.

Tax relief for donated trading stock

The new legislation provides tax relief for businesses that have made, or are contemplating making, donations (or supplies for less than market value) of trading stock for relief from the Canterbury earthquakes.