New legislation - 2010: Orders in Council (2010)
KiwiSaver first home subsidy
The KiwiSaver first home deposit subsidy has been made a social assistance suspensory loan in recognition of its social policy objective. This ensures that recipients of this subsidy are not subject to income tax when the obligation to repay the loan is released.
The KiwiSaver first home deposit subsidy was designed to help first home buyers and previous home owners (who are in a similar financial position to first home buyers), who would be able to sustain a commercial mortgage but face difficulties saving for a deposit. KiwiSavers may be eligible for the deposit subsidy after three years of contributing to the scheme. The subsidy is $1,000 for each year of contribution, up to a maximum of $5,000, and is available from 1 July 2010.
The deposit subsidy is provided as a suspensory loan from Housing New Zealand Corporation to the recipient. For the purposes of the deposit subsidy, a recipient must live in the home for at least six months. After this time there is no longer a requirement to repay the loan. Normally, when a debt is forgiven, the amount becomes "income" for the purposes of the Income Tax Act 2007.
The amending regulations come into force on 1 July 2010.
Income Tax (Social Assistance Suspensory Loans) Amendment Order 2010 (SR 2010/99)
Other pages in: Orders in Council (2010)
- Use-of-money interest rates change
- Minimum family tax credit income amount increased
- Remission of use-of-money interest for Canterbury earthquake victims
- FBT rate for low-interest loans
- FIF deemed rate of return set for 2009-10
- Rise in FBT rate for low-interest loans
- Parental leave and employment protection - changes to advisor status
- Student loan scheme - volunteer exemption
Date published: 11 Jun 2010
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