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Inland Revenue

Tax Policy

Other
Published 28 September 2021

Interest limitation information sheets

The interest limitation proposals released by the Government on 28 September 2021 are part of its overall efforts to address New Zealand’s housing affordability issues. The aim of the proposed measures is to reduce investor demand for residential property.

In summary, residential investment properties capable of being used for long term accommodation would be subject to the proposed rules. However, the following exclusions and exemptions are proposed:

  • an exclusion for the main family home
  • exclusions for several types of residential property, and
  • exemptions for new builds and for property development.

The following information sheets provide general information about how the proposed rules are intended to work:

  1. Interest deductibility proposals at a glance
  2. Properties not affected by the interest deductibility proposals
  3. How the rules work for certain entities
  4. Exemptions for property development and new builds
  5. How interest deductions are affected
  6. Changes to the bright-line property rule