A focus on topical tax issues - October 2016
It’s feasible that feasibility expenditure may still be deductible… sometimes
Back in July we reported on the outcome of the Supreme Court decision in Trustpower v Commissioner of Inland Revenue  NZSC 91. A first read of the case left many feeling dread about how they were to prepare their tax returns, with the case throwing doubt on what feasibility expenditure might still be deductible.
Following the release of the Supreme Court judgment we were on record saying “All eyes now turn to the Inland Revenue to find out what its next step will be.” Late last month we saw Inland Revenue’s next step, with the Office of the Chief Tax Counsel releasing a draft revised interpretation statement on the deductibility of feasibility expenditure (available here) which seeks to provide practical guidance on how the judgment should be applied.