• Login:
Welcome, Register Here
follow PropertyTalk on facebook follow PropertyTalk on twitter Newsletter follow PropertyTalk on LinkedIn follow PropertyTalk on facebook
Page 1 of 2 1 2 LastLast
Results 1 to 10 of 13
  1. #1

    Question Capital gains tax

    I have a family trust with some properties I am looking to hold for the long term.What I am interested in is wether, if I can afford it is to buy a house for 6 months to a year, pay the excess off every month and then sell it paying the Capital gains tax and hopefully make a profit...?

    Any ideas or personal experiences along this line?

    Cheers,


    PH

  2. #2
    Join Date
    May 2004
    Location
    Bay Of Plenty, NZ
    Posts
    3,604

    Default Capital gains tax

    We don't have a capital gains tax in New Zealand.

    What we have is a tax on profit. And if you're making a profit, why wouldn't you want to pay tax??
    Patience is a virtue.

  3. #3
    Join Date
    Jun 2005
    Location
    Auckland
    Posts
    5,084

    Default

    Hi propertyhunter,

    In the current flat, or downward, market, what plans do you have that make this a good idea. If you can get the property significantly under RV/FMV, why not sell it on straight away (before the market/and or inflation and/or holding costs eat away at your margins)?

    Essence is right - there is not capital gains tax, but there is company tax (if you structured as a company) or income tax.

    Also, be wary to not let this trading activity near your long term holds - you don't want to taint them and have to pay tax on the profit and, worse, GST on the sale price, if or when you sell.

    cube
    DFTBA

  4. #4

    Default

    Is the situation really that bad or is it still speculation?
    I thought I had to pay capital gains tax on it if it was blatently obvious my reason for selling a property was just for profit?

    Thanks


    PH

  5. #5
    Join Date
    Dec 2003
    Location
    Wellington
    Posts
    606

    Default

    Warning I am not a professional accountant - sounds like you need 1. I do know that if you get tainted as a trader than not only the property you sell but also any other properties you may sell in the future will be assessed for CGT including, I think your family home.

  6. #6
    Join Date
    Feb 2004
    Location
    Wellington
    Posts
    2,776

    Default Yet again....

    Quote Originally Posted by Propertyhunter View Post
    Is the situation really that bad or is it still speculation?
    I thought I had to pay capital gains tax on it if it was blatently obvious my reason for selling a property was just for profit?

    Thanks


    PH
    There is no capital gains tax in NZ!!!!!.....maybe third time's the charm

    If your intent at purchase was later resale at a profit, then that profit is treated as income.......you pay tax on income.

    What do you mean is the situation that bad???.....what's bad about paying tax on any profit you make.....it's part of your civic duty.....sure you should aim to pay the least tax possible, but that doesn't include lying and stealing

    Cube's/Lissie's warning about tainting only applies to any properties you purchase after you start buying and selling for a profit.

    Cheers
    Spaceman
    Delightfully in need of some Tender Loving Care
    Blessed are those who can give without remembering and take without forgetting
    Some things are not as they seem, nor are they otherwise

  7. #7

    Default

    yeah thats sort of the lines along what I thought, but being that I have a Trust that holds my other properties I thought if I traded privately under my personal name (or a company if it is better) I would be able to pay the tax and move on to the next...?

    I am concerned about the current state of afairs and can only base it on what I have read...

    Cheers

    PH

  8. #8

    Default

    Quote Originally Posted by spaceman View Post
    If your intent at purchase was later resale at a profit, then that profit is treated as income.......you pay tax on income.
    Cheers spaceman,
    How do you go about making it your intent though?

    PH

  9. #9
    Join Date
    Apr 2005
    Posts
    2,698

    Default

    They will ask the simple question..."why did you get involved in a situation that you knew you would make a loss from"?

    (Negative gearing)

    If you have a good answer, then you are half way home.

    You see,
    the tax hole is only there so long as it lets the govt pass on the job of rental housing into private hands.

    Speculation on housing has an inflationary effect,
    and threrefore works against their main idea of reasonable cost housing... for everyone ( without them having to manage it).

    Basically, speculators stuff up the whole system for them.

    They seriously want to kick your behind .

  10. #10
    Join Date
    Apr 2005
    Posts
    2,698

    Default

    that reminds me.

    Do you suppose that the free market mantra of "supply and demand" still work if you include speculators and advertising?

    ( Because both speculation and advertising create a demand ratio out of phase with need ).


 

Thread Information

Users Browsing this Thread

There are currently 1 users browsing this thread. (0 members and 1 guests)

Similar Threads

  1. Capital Gains taxed (trading bent) - What about Capital Loss ??
    By Bluekiwi in forum Finance, legal and tax (NZ)
    Replies: 26
    Last Post: 14-12-2012, 03:44 PM
  2. Paying NZ capital gains in OZ
    By tarn in forum Australia
    Replies: 5
    Last Post: 26-06-2012, 03:13 AM
  3. Capital Gains vs Cashflow
    By yesindeed in forum Property Investment (NZ)
    Replies: 4
    Last Post: 18-05-2009, 11:29 AM
  4. Capital gains
    By caligpierson in forum Property Investment (NZ)
    Replies: 3
    Last Post: 08-06-2008, 10:38 PM
  5. GST, Capital Gains, Tainting.
    By BamBam in forum Finance, legal and tax (NZ)
    Replies: 13
    Last Post: 25-10-2007, 08:17 PM
  6. Capital Gains Tax By Another Name??
    By Walter in forum Finance, legal and tax (NZ)
    Replies: 0
    Last Post: 08-05-2007, 01:14 PM
  7. clawback & capital gains
    By casacamo in forum Finance, legal and tax (NZ)
    Replies: 7
    Last Post: 14-06-2006, 11:05 PM
  8. Capital Gains Tax
    By Walter in forum Finance, legal and tax (Oz)
    Replies: 0
    Last Post: 11-04-2006, 12:13 PM
  9. Capital Gains Tax & LAQC
    By carolvw in forum Finance, legal and tax (NZ)
    Replies: 1
    Last Post: 04-10-2005, 08:57 PM
  10. Exemptions to Capital Gains Tax (CGT):
    By muppet in forum Property Investment (UK)
    Replies: 0
    Last Post: 24-09-2005, 10:59 PM

Posting Permissions

  • You may not post new threads
  • You may not post replies
  • You may not post attachments
  • You may not edit your posts
  •