HRS § 241-1.5 — Time of application of tax and other provisions


§241-1.5 Time of application of tax and
other provisions. (a) The tax imposed by this chapter applies to every
bank, building and loan association, development company, financial
corporation, financial services loan company, trust company, mortgage loan
company, financial holding company, small business investment company, or
subsidiary as defined in section 241-1:
(1) Which is in business at the commencement of a
calendar year, as of January 1 of that year;
(2) Which begins business after the commencement of a
calendar year, as of the commencement of business.
(b) The measure of the tax for the year in
which the taxpayer begins business is an estimate of the net income of the
taxpayer for that year or for the part of that year in which it is in business.
The tax for the year in which the taxpayer
begins business shall be at the tax rate provided in section 241-4.
The estimate shall be made on forms provided by
the department and shall be subject to adjustment by the filing of an amended
return as provided in subsection (e). The tax shall be paid on or before the
twentieth day of the third month after the month in which the taxpayer begins
business. Payment of the tax shall accompany the return unless time for the
payment is extended by the director of taxation. The extension may be granted
by the director in order to provide for payment of the tax in installments
during the remainder of the calendar year.
(c) The measure of the tax for the year
following the year in which the taxpayer began business is an estimate,
utilizing the average monthly net income of the first taxable year of doing
business multiplied by twelve. The tax shall be at the rate provided by
section 241-4. A return shall be made and the tax returned and paid on or
before the twentieth day of the fourth month following the close of the first
taxable year of doing business and shall be subject to adjustment by the filing
of an amended return as provided in subsection (e).
(d) If the taxpayer is in business at the
commencement of the calendar year, and was in business during the whole of the
preceding year and prior thereto, the tax shall be returned and paid as
provided in section 241-4.
(e) An amended return shall be filed after the
close of the applicable taxable year for each year for which an estimated tax
return was filed under subsection (b) or (c).
If subsection (b) or (c) applies, any variance
between the estimate and the actual net income for that year shall be adjusted
and a credit or refund made, or payment of additional tax due, depending upon
whether the estimate was in excess of, or less than, the actual net income of
the taxpayer for the year.
The amended return shall be made and filed and
any additional tax due paid on or before the twentieth day of the fourth month
following the close of the taxable year in which the taxpayer commenced
business.
The adjustment of the tax imposed under this
chapter and the making of an amended return as provided under this section
shall apply only to the first and second taxable years of doing business.
(f) Whenever any taxpayer subject for any year
to the tax imposed by this chapter shall have acquired by purchase or otherwise
during the preceding year the business or any part thereof of another taxpayer
liable to tax under this chapter for such preceding year but not liable for the
year following such sale or disposition, and the acquiring taxpayer continues
the operation of the business so acquired, the net income to be reported by the
acquiring taxpayer for the purpose of determining the amount of its tax under
this chapter for the year following the year in which the business was so
acquired shall include, in addition to the net income of the acquiring taxpayer
during the year ending December 31 or fiscal year preceding, whichever is
applicable, the net income of the business or part thereof so acquired for such
portion of such preceding year as such business was not operated by the
acquiring company.
This subsection shall not apply to any taxpayer
whose tax for the year involved is measured under subsection (b) by an estimate
of gross income for such year subject to adjustment after the close of the
year.
If the first paragraph of this subsection
applies but the tax of the acquiring taxpayer for the year is governed by
subsection (c) and adjusted under subsection (e), then in determining the
average monthly net income for that purpose there shall be included in addition
to the net income of the acquiring taxpayer for the period involved in the
determination of the average, the net income of the business or part thereof
acquired by the taxpayer for the portion of that period in which the business
was not operated by the acquiring taxpayer.
(g) Whenever there is a consolidation or
merger of taxpayers subject to the tax imposed by this chapter, the tax shall
attach to the taxpayer thus formed and the net income which shall be used for
measuring the tax of the taxpayer thus formed shall include the net income of
the taxpayers which were consolidated or merged.
(h) If a taxpayer subject to the tax imposed
by this chapter terminates business operations during the calendar or fiscal
year and other than in an acquisition by another company, or merger, or
consolidation, the tax shall apply to the actual net income for the taxable
year or part of the taxable year the taxpayer continued business operations.
If a taxpayer subject to the tax imposed by
this chapter terminates business operations during the taxable year:
(1) Before the tax return is filed as required under
section 241-5, a short year return shall be made and filed and the tax shall
apply to the actual net income for the taxable year or part of the taxable year
during which the taxpayer continued business operations; or
(2) After the return has been made and filed as
provided in section 241-5, an amended return shall be made and filed to show
the actual net income for the taxable year or part of the taxable year during
which the taxpayer continued business operations. Any variance between the tax
computed and paid on the basis of the entire net income of the preceding
calendar or fiscal year and the actual net income for the final year or part of
a year of business operations shall be adjusted and a credit or refund made, or
the payment of additional tax shall be made.
The return made under paragraph (1) or (2)
shall be filed and the tax imposed by this chapter shall be paid on or before
the twentieth day of the fourth month following the month business operations
ceased or the close of the taxable year, whichever is earlier.
The tax computed under this subsection shall
not be duplicated with respect to the tax of an acquiring taxpayer as
determined under subsection (f) or (g).