The Business Advisory Blog

The Business Advisory Blog

Insight, news and updates from Alliott NZ Chartered Accountants, Auckland New Zealand. The views expressed here are the views of the author and should be discussed in further detail should an article be relevant to your individual circumstances.

While every effort has been made to provide valuable, useful information in this publication, this firm and any related suppliers or associated companies accept no responsibility or any form of liability from reliance upon or use of its contents. Any suggestions should be considered carefully within your own particular circumstances, as they are intended as general information only.

Anthony McIlroy
Published on

There have been webinars and newsletters galore about the new rules for taxing residential property sold within two years of acquisition.

light bulb-956The new Act doesn’t apply if:

  • The property was the client’s “main home”
  • A transfer under a relationship property agreement
  • Sale of inherited property

But note the following:

  1. The period is not what you would usually think of as two years. The start and end dates apply differently. The period starts on the last day when the person acquires the property; usually the date on which the title is registered. It generally finishes on the date the client enters into an agreement to sell.
  2. Losses are ring fenced. But, if you were trading in property and made a loss on sale, it wouldn’t be ring-fenced.
  3. Profit on property bought and sold outside the two-year period may still be taxable under ordinary rules.
  4. The start date for sale “off the plan” is “Contract to purchase”.
  5. The “main home” exclusion cannot be used if it has been used twice in the last two years.
  6. The test applies to agreements to buy property (date of S & P) after 30 September 2015.
If you have any questions about the new rules or would like to discuss your particular circumstances, please contact Alliott NZ in Auckland today on 09 520 9200.

Topics: property Property sale residential tax