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  • #16
    The information comes from IRD responding to a request under the Official Information Act

    https://fyi.org.nz./request/14381/re...20Jan.pdf.html


    For the tax year ending 31 March 2019 approximately 290,000 taxpayers were identified as having been involved in residential rental property

    https://fyi.org.nz./request/14105/re...livan.pdf.html

    In the previous year 300,000 taxpayers were identified as being involved, i.e. a 10,000 YoY reduction.

    It will be interesting to see 2020 data when it becomes available.

    We don’t know whether the decline in tax payers being involved in rental business translates into a decline in rental property availability.

    Comment


    • #17
      Originally posted by McDuck View Post

      Ha, that made me laugh.
      Yes, it can go both ways.

      The main imbalance here, is that the the wages of the renter are taxed.
      In contrast, with the right structure, the Income of the landlord is not.

      Also, the savings of the renter are given a miserable return by the bank,
      whereas the landlord is getting about 20% capital gain on at least a million dollars ...

      So really, a little bad press should be soothed by the huge financial gain..
      Don't you think.

      Traditionally a group with a poor public image donates to charity or pays for some public work..
      So that's your best path.
      Umm too many assumptions about who renters are IMHO

      Not all renters are employed and are therefore taxed at source. Not all renters would just have savings in the bank getting a low ROI.

      There are renters who would do 'tax planning' in much the same way LLs do and they would pay less or no tax on their income. Plus there are renters who 'choose' to rent for various reasons and they are likely to have other investments.

      Just thought I should post this - as there would be a good percentage of very savvy renters who have just made other choices than be a LL.

      cheers,

      Donna
      SEARCH PropertyTalk, About PropertyTalk

      BusinessBlogs - the best business articles are found here

      Comment


      • #18
        Originally posted by donna View Post

        Umm too many assumptions about who renters are IMHO ..

        Just thought I should post this - as there would be a good percentage of very savvy renters who have just made other choices than be a LL.

        cheers,

        Donna
        Ha.

        I'm with you Donna.
        It's possible, but it must be a very small percentage.
        I've honestly never met any. Ever.

        And certainty no one recently who is renting by choice.
        Most just work hard and can't get a foothold.

        One guy is on 100K and more, but with a young family and student loan.

        Comment


        • #19
          Originally posted by McDuck View Post

          [...]

          The main imbalance here, is that the the wages of the renter are taxed.
          In contrast, with the right structure, the Income of the landlord is not.


          The "wages" of a landlord are equally taxed.

          The "income" of a landlord, if there is profit, is also taxed.

          So the landlord earns a dollar from wages which is taxed.

          He takes what's left of the dollar (after tax) and invests in property.

          If the property makes money he pays tax again on the profit, often at a higher tax rate.

          What am I missing?



          Comment


          • #20
            McClucky logic.
            Want a great looking concrete swimming pool in Hawke's Bay? Designer Pools will do the job for you!

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            • #21
              Originally posted by Sanya View Post

              What am I missing?
              Good question.
              An eye?



              Comment


              • #22
                Originally posted by McDuck View Post
                [...]
                The main imbalance here, is that the the wages of the renter are taxed.
                In contrast, with the right structure, the Income of the landlord is not.
                Originally posted by Sanya View Post
                The "wages" of a landlord are equally taxed.
                The "income" of a landlord, if there is profit, is also taxed.
                So the landlord earns a dollar from wages which is taxed.
                He takes what's left of the dollar (after tax) and invests in property.
                If the property makes money he pays tax again on the profit, often at a higher tax rate.
                What am I missing?
                Originally posted by McDuck View Post
                Good question.
                An eye?
                As I expected, that’s not an answer.

                To add, from April 1st 2021 some landlords will be paying a new higher income tax rate of 39 cents in the dollar. This arises because landlords need to pay tax on residential rental income on top of tax they pay for salary or wages.

                In contrast many renters effectively pay no income tax. This arises because those households receive more in transfers than they pay in tax. In other words, they are net recipients rather than payers under our tax system.

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