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Technical tax area
Ngā tūmomo whakataunga me ngā aratohu

QB 17/02: Income tax - date of acquisition of land, and start date for 2-year bright-line test

This Question We’ve Been Asked deals with the issue of when land is acquired under s CB 15B. It concludes that what is relevant is when the first interest in the land (ie, the particular estate) that is being disposed of was acquired. In a typical land purchase this will be when a binding contract to purchase the land is formed (even if some conditions still need to be met). The item also looks at when the 2-year period for the bright-line test starts, which is generally not the same date as the date land is acquired under s CB 15B. Since the item was consulted on, the Commissioner has reached a different view on the application of the bright-line test to nomination situations from that in the draft item. As a result of submissions received and further consideration of the issue, the item concludes that in a nomination situation the bright-line test will not apply because there is no disposal by the nominator.

Date of issue: 30 March 2017

QB 17/02 - PDF format (318kb | 24 pages)

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