That's a good question. (See this article if you’re wondering what an LTC is)
IRD says yes, under certain circumstances (NB: this is not the only way to get into rental investment property. Contact us for advice). Anyway, IRD recently wrote in TIB Vol. 24 No. 7: QUESTION
http://www.ird.govt.nz/technical-tax/questions/questions-general/qwba-1211-it-ltc-rental-prop-avoidance.html Key Points Key points to note are 1. The home must be rented “at arm’s length.” It means that each party to a transaction is independent and on an equal footing, despite any family relationship. 2. The sale is at market value. There should be no “mate’s rates” here. (If you are renting to a family member, contact us for advice on best practice) Questions? Contact us at EpsomTax.com or on 0800 890 132.
2 Comments
8/1/2023 01:57:39 am
Selling your property fast is not always an easy task. You need to deal with inspectors, showings, requested repairs by buyers, staging the house, keeping the house clean and paying commissions, closing costs, and other fees involved. We understand that selling a property in the traditional way is not for everyone, and this is why we came up with our service.
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8/30/2023 10:12:45 pm
Your clear explanation of the tax implications regarding selling a family home to an LTC helped me understand the concept better. Thanks for breaking down a complex topic into easily understandable insights.
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