Before you pay the income tax you owe on your property sale, you’ll need to complete an income tax return.
You’ll generally include the amount of property income you’ve earned in the 'property income' box or for older returns the 'other income' box.
You’ll also complete a Bright-line property sale information - IR833 and submit this along with your income tax return if the bright-line property rule applies to the sale.
Once your income tax return is filed with us, you’ll need to pay your income tax by the due date.
Selling residential property at a loss
If you sell a residential property subject to the bright-line rule at a loss, the loss will be ring-fenced against other property income.
This means you can only claim the loss when you have a future gain on other land sales that are taxable.
You cannot claim the loss against other types of income such as self-employed income, rental or salary and wages. residential property deduction rules
Residential property deduction rules
Work out the net profit or loss on a taxable property sale.Go to this tool