Is it worth for Non tax resident to have LTC?

[Palmtree]

If my property make a loss and there is no other income to offset the loss. You don't get refund for the loss when you fill the IR3NR. I have searched throught tax forum here and still very confussed. Spaceman said the loss will be seating there when you return, but how? It doesn't show any where.

Rosco, and other expats or anyone's advice would be appreciated

[Minz]

I really have no idea other than to say that as a long term expat we have a trust that owns my investment property company which is a LTC. The trust has our mortgage free family home in it and the LTC has my investment properties. Any losses in the LTC off set the profit in our trust. Unfortunately this won't really help you as our trust is a NZ tax resident!

[Anthonyacat]

To clarify, this question (and my answer below) has nothing to do with having an LTC. The question and answer would be the same whether the property was owned in your personal names, or a partnership structure. Or in fact even in a (regular) company or trust, but the losses would then carry forward in the name of that entity, not yourselves personally.

Also, there's little difference between residents and non-residents on this issue. Regardless of your residency, if your property makes a loss and you have no other income, there will be no refund, and losses carry forward to future years. The difference is that most residents have other income to offset it with. But many don't.

Box 25 on the 2015 IR3NR allows you to enter Losses Carried Forward from prior years. That's where it shows. There is a similar box on the IR3 forms.

After you file your 2015 IR3NR (or, for residents, the IR3), the IRD will send you a letter confirming your losses carried forward to the next year. You keep this letter, and enter this number on your 2016 form.

If you have more losses the next year, the number will get higher year on year. If you start having positive net income, the number will get lower. Once it reaches zero, you need to start paying tax on your income again.

[Palmtree]

Thanks, Anthonyacat!

I will need to find out where our letter went last year and make sure we have a letter from IRD this year.

We are filling online and this year is the first year that we have total loss without other income to offset the loss.