CLOSE X

Register - if you don't have an account

Yes! Sign me up for Global Property Guide's fortnightly email newsletter.


Login - for registered users

Forgot Password?
Explore destinations
continent map couldn't be loaded Pacific Europe & Russia North America Latin America Asia Africa Middle East Caribbean

 


Financial Overview

Directory

Property Search

Global Statistics

Regional Statistics






May 04, 2016

Rental income tax is
high in New Zealand


INDIVIDUAL TAXATION

Nonresident individuals are liable to pay tax on their income from sources in New Zealand. Married couples are separately assessed and taxed on their income.

The tax period in New Zealand is from 01 April of the current year up to 31 March of the succeeding year. The tax year 2015-2016 is from 01 April 2015 to 31 March 2016. The tax year 2016-2017 is from 01 April 2016 to 31 March 2017.

INCOME TAX

Taxable income is computed by deducting income-generating expenses, tax credits and tax rebates from the gross income. Income is then taxed at progressive rates.

INCOME TAX (APRIL 2015 – MARCH 2016)

TAXABLE INCOME, NZD (US$)
TAX RATE
Up to 14,000 (US$9,333) 10.50%
14,000 - 48,000 (US$32,000) 17.50% on band over US$9,333
48,000 – 70,000 (US$46,667) 30% on band over US$32,000
Over 70,000 (US$46,667) 33% on all income over US$46,667
Source: Global Property Guide

RENTAL INCOME
Various expenses can be deducted from gross rental income, such as: rates (municipal land tax) and insurance; interest payments on mortgage to finance the rental property; agent’s fees for maintenance, collection of rent, and search of tenants; repairs and maintenance that is not considered as capital improvements on the rental property; motor vehicle expenses; legal fees incurred in arranging mortgage and drawing up a tenancy agreements (legal fees related to the buying and selling of the property are not deductible); accountant’s fee for the preparation of accounts; depreciation allowance to cover the cost of wear and tear and general ageing of the building and its contents.

new zealand taxes

Assets include buildings, capital improvements and chattels (furnishings, etc), which can be depreciated through either diminishing or straight scale. Buildings can either be depreciated by 4% (diminishing line) or 3% (straight line). Assets can be depreciated individually or in a group (pooled). Pooled assets can only be depreciated using the diminishing method, using the lowest depreciation rate in the group.

CAPITAL GAINS
Gains resulting from the sale of real property are not normally taxed in New Zealand.

They are taxed at normal income tax rates only under the following circumstances: the business of the taxpayer consists of dealing in such property, the property was acquired for the purpose of selling the property and the profits or gains were derived from the carrying out of an undertaking scheme for the purpose of making a profit.

PROPERTY TAX


There are no real estate taxes in New Zealand.

CORPORATE TAXATION

INCOME TAX

Income and capital gains earned by companies is subject to corporate income tax at a flat rate of 28%. Income-generating expenses are deductible when calculating taxable income.

  





Comments

#1 STEVE GUY | May 11, 2010

Okay, so there are no taxes levied on the sale of real-property in New Zealand. What I want to know is what are the yearly property tax rates in New Zealand.

#2 HENRYPOOLE | March 14, 2014

Foreclosing your home is the saddest part since you find your self homeless. One of the bad effect of economic crisis is that you cannot pay for your taxes and other debt obligations. A cash advance can help you pay for your lien against your property.

Login or Register to submit a comment!

In order to promote open and spam-free conversations, Global Property Guide moderates commetns on all articles. You can expect that your comment will be published within 24 hours.



Compare Countries



Free Newsletter

Fortnightly updates from the global property arena directly to your inbox.


Email Address:





Connect to professional advice in New Zealand





PROPERTY RECOMMENDATIONS

 
Download free property reports from international research houses

Our Newsletter

 
Fortnightly updates from the global property arena directly to your inbox.

Manage subscriptions