This interpretation statement considers the tax consequences for forestry activities registered in the Emissions Trading Scheme. The statement considers the tax consequences of receiving, selling and surrendering emissions units (NZUs), as well as the tax treatment of specific transactions involving NZUs.

CA ANZ had previously raised with Inland Revenue that there was a lack of guidance around the tax treatment of emissions units, particularly when transferred between taxpayers. The issue became more prominent with the introduction of the purchase price allocation regime. CA ANZ acknowledges and appreciates Inland Revenue’s efforts in dedicating resources to address this matter and believes that the guidance, once issued, will provide valuable clarity for taxpayers. To further enhance the document, CA ANZ suggests a few additional improvements.