IRD is consulting on a draft of interpretation statement PUB00478: INCOME TAX – BUSINESS ACTIVITY. Deadline for comment is 5 September 2025. Background: The interpretation statement gives guidance on whether a taxpayer is carrying on a business for income tax purposes. Knowing whether an activity is a business is crucial as that gives rise to income being… Continue reading Are You Carrying on a Business?
Upon a person’s death, their property vests in the executor or administrator of their estate. The transfer of assets to a beneficiary, such as the widow, is legally a distribution from the deceased’s estate. For GST purposes, this distribution is a “supply”. Can GST Neutrality be achieved?There are two primary ways to ensure the transfer… Continue reading Transfer of Business Assets Upon Death & GST
Questions often arise whether a sum of money or property received from overseas is taxable in New Zealand? In many cases, these payments arise from inheritances or family trusts based offshore. While the assumption is often that such transfers are tax-free, the reality can be quite different—especially when the distribution is deemed at law to… Continue reading Foreign Trusts & Inheritances: What You Need to Know
Due to the decentralised nature of the crypto, the common misconception is that crypto transactions enjoy anonymity and cannot be traced. In 2024 IRD has identified 227,000 unique cryptoasset users in New Zealand undertaking around 7 million transactions with a value of $7.8 billion. IRD has made it clear on a few occasions: that crypto… Continue reading Crypto Assets
We are often faced with questions around the choice of FIF calculation method that taxpayers can choose. Whilst it is a common knowledge that Fair Dividend Rate (FDR) or Comparative Value (CV) methods can be used where market value is readily available, there are limitations on the choice of method used. In case of a… Continue reading Foreign Investment Fund (FIF) Investments
Before the introduction of the interest limitation rules the largest proportion of deductions for residential property investors was the interest component. However, the Government has decided that residential property investors have an advantage over other occupiers because they can deduct their interest. This conveniently overlooks the fact that the deductions are being made against rental income. However, not… Continue reading Interest Limitation on Residential Land & Brightline Test
KILOMETRE RATE 2022 YEAR VARIATION TO TAX POOLING TRANSFERS COV22/15 Amendment has been made to clarify that the last date upon which a taxpayer can make a transfer request is 30 Sept 2022. See TIB Vol 34, No 4, May 22. DEEMED RATE OF RETURN For the 21/22 year has been set at 6.01% for purposes of… Continue reading Interest Rates Effective 01 July 2022
HOUSING POLICY MEASURES CLARIFIED The Government has released Supplementary Order paper no 64 (SOP) to the Taxation (Annual Rates for 2021–22, GST, and Remedial Matters)…
Last week IRD released its discussion document on the application of the new interest deduction limitation. Whilst this is a discussion document only it gives good indication where the Government is heading. The Government is blindsided by the illusion that these draconian rules will somehow reduce the upward pressure on housing prices. Whilst these rules… Continue reading Residential Rental Properties & Interest Deduction Limitation & Additional Brightline Rules
