You may be able to get an exemption from paying the residential land withholding tax. This means your withholder will not deduct RLWT from your residential property sale.
Who can get the RLWT exemption
You may get a residential land withholding tax exemption if you're a developer and have:
You may also get an exemption if you're:
- an individual or trust
- selling a property eligible for the main home exclusion as per the bright-line property rule, which means you'll be exempt from paying tax on the sale.
Applying for an RLWT exemption
If you can get the RLWT exemption, you'll need to apply before the settlement.
Applying for a RLWT exemption for subdivisions
Applying for a RLWT exemption for subdivisions is different. If you've subdivided or you're going to, you apply for each individual piece of subdivided land. You can do this by either using:
- one IR1103 outlining all pieces of land the exemption applies to
- separate IR1103 forms for each piece of land.
For each piece of subdivided land, it will need its own Record of Title. If you do not have this, you'll need to include a copy of:
- the subdivision plan, eg, master, sale or survey plan
- any other supporting documents outlined on the IR1103.
In your application, you'll need to include the subdivision plan or other supporting documents outlined above. These should outline the allocated number or letter of the individual piece(s) of land. These are the ones the exemption is being applied for.