New rules for selling

[skid]

One thing for sure --The guns are out.

disc-I believe that when prices increase like they have over the last year in Auck.-Its like providing rope to hang ourselves with.---a little slower,but steady would be better.

[PTILoveYou]

So are you going to report to IRD re your neighbours?

If IRD pays me, maybe.

[Courham]

The gov't needs to set up an 0800 number- dob in a tax dodging property trader.

Gov'ts have been more than happy to do so for beneficiaries "ripping off the system" but the money not being paid in taxes over the past decade by people not declaring income made in property to IRD, or IRD not catching them would far outweigh that. More fun to bash the most vulnerable rather than potential national voters though.

They aren't just ripping off IRD, they are ripping off me and you- via less money collected to spend on hospitals, education, roads etc. We are all losers in this.

Craig

[elguapo]

If IRD pays me, maybe.

A reliable moral compass as usual!

[elguapo]

The gov't needs to set up an 0800 number- dob in a tax dodging property trader.

0800 225 610

[donthatetheplayer]

Two years... What a waste of time. JK's a smart operator. He will appease the uninformed masses and meanwhile it's business as usual. Most professional traders flipping in under two years will be paying tax already. Most others will not be flipping in under two years... Should have made it five years if they wanted it to actually be meaningful.

[PTILoveYou]

Two years... What a waste of time. JK's a smart operator. He will appease the uninformed masses and meanwhile it's business as usual. Most professional traders flipping in under two years will be paying tax already. Most others will not be flipping in under two years... Should have made it five years if they wanted it to actually be meaningful.

Those who flip after two years can still be caught by IRD anyways.

If IRD is any good at catching tax dodgers then they don't need to implement this new rule at all.

[Rosco]

Why should personal homes be excluded?

And what about shares and other investments? If you buy and sell them within 2 years, shouldn't the gains be taxed too?

What about farms? Will they get away with it because they live there?

I see this rule as picking on property investors and believe that other investments and asset owners should be taxed the same. Otherwise it just leads to loop holes!

I also believe 2 years is a bit short!

Ross

[donthatetheplayer]

Why should personal homes be excluded?

And what about shares and other investments? If you buy and sell them within 2 years, shouldn't the gains be taxed too?

What about farms? Will they get away with it because they live there?

I see this rule as picking on property investors and believe that other investments and asset owners should be taxed the same. Otherwise it just leads to loop holes!

I also believe 2 years is a bit short!

Ross

Spot on Ross. Shares are a major one that needs to be looked at too! Who's honestly bought Xero for the dividend income?

[jimO]

what if you sell before 2 years is up and make a loss, do you get a rebate

[flyernzl]

Questions questions:

If you buy, renovate and sell, are the costs of the renovation included in the 'buy' price?

If you happen to buy in Patea or Galatea and the price goes down (ie you sell at a loss) is this income tax deductable?

If I am a smart trader, buy a 600K house for 700k (and the seller then kicks me back the extra 100K), and then sell again for 700K how will that be tracked?

I have a friend who wants to move towns.He has just found a house he likes in the town he likes, and has had his offer accepted. He has yet to sell his existing residence, so is letting the tenant in the new house continue on until he has sold his old property. If he does move in, finds he doesn't like it after all, and then sells his new house within two years does that fall within the IP rules?

[Bob Kane]

Why should personal homes be excluded?

And what about shares and other investments? If you buy and sell them within 2 years, shouldn't the gains be taxed too?

What about farms? Will they get away with it because they live there?

I see this rule as picking on property investors and believe that other investments and asset owners should be taxed the same. Otherwise it just leads to loop holes!

I also believe 2 years is a bit short!

Ross

Good questions, Rosco.
But I think these new rules are deliberately written this way to calm down the media and the socialists like Bernard Hickey while giving enough loopholes for everyone to dodge them.
So it's a win to the media (see, we're now taxing these property investors) and a win to the property investors (hold for two years or move into the house and then sell it) and a win to the National Party (how can Labour attack us when we've brought in a CGT?)
Pretty clever of John Key, aye?

[PTILoveYou]

what if you sell before 2 years is up and make a loss, do you get a rebate

Income loss, yes you can claim tax return

[PTILoveYou]

Questions questions:

If you buy, renovate and sell, are the costs of the renovation included in the 'buy' price?

If you happen to buy in Patea or Galatea and the price goes down (ie you sell at a loss) is this income tax deductable?

If I am a smart trader, buy a 600K house for 700k (and the seller then kicks me back the extra 100K), and then sell again for 700K how will that be tracked?

I have a friend who wants to move towns.He has just found a house he likes in the town he likes, and has had his offer accepted. He has yet to sell his existing residence, so is letting the tenant in the new house continue on until he has sold his old property. If he does move in, finds he doesn't like it after all, and then sells his new house within two years does that fall within the IP rules?

Tax is claimed at the profit, so reno cost is deducted from the sale price minus purchase price etc.

If you make a loss, yes you can claim the loss against your income. This is not capital loss but income loss.

IRD will have some ways to find out how that $100k changes hands.

He will have to justify this to IRD.

Then again I'm no accountant nor IRD so who knows.

[elguapo]

And what about shares and other investments? If you buy and sell them within 2 years, shouldn't the gains be taxed too?

International shares are covered by FIF rules, I'd gladly swap that for this 2 year rule!