Hon Louise Upston
Minister for Land Information
10 September 2015
Property rules strengthened by Taxation Bill
Revenue Minister Todd McClay and Land Information Minister Louise Upston say people buying and selling property for profit will now be unable to avoid paying their fair share of tax.
Provisions introduced in the Taxation (Land Information and Offshore Persons Information) Bill passed the Third Reading in Parliament today.
The resulting measures amend the Land Transfer Act and Tax Administration Act 2015, and will see Land Information New Zealand (LINZ) collect additional information when property is bought and sold, and pass this information to Inland Revenue.
“Under this legislation, buyers and sellers will have to provide their IRD number and other details when transferring property – unless it is, or will be, their main home,” Mr McClay says.
“Those who are tax resident elsewhere must provide their IRD number from that country – and offshore persons need a working New Zealand bank account to get a New Zealand IRD number.”
The requirements apply to contracts entered into on, or after, 1 October. From 1 April 2016, all additional information must be provided regardless of when the contract was entered into. The main home exemption does not apply to offshore persons or trusts.
“Most people do the right thing and pay their taxes, but there has been some concern that compliance with taxes on certain property transactions – particularly by non-residents – may be relatively low,” Ms Upston says.
“The additional information will help us better understand the housing market, and help Inland Revenue follow up on those people who have tax obligations.
“New Zealanders have a right to know that everyone is paying their fair share of tax. This new legislation will ensure that happens, without affecting New Zealanders who have worked hard and saved to buy their family home.”
Lesley Hamilton (Minister McClay) 027 490 1345
Libby O’Brien (Minister Upston) 0220 749 670