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If you're a withholder you'll deduct residential land withholding tax (RLWT) for the offshore RLWT person.

Your role within the process is done when the RLWT is paid to us.

Check if RLWT should be deducted from the property sale

You'll need to deduct RLWT for the property sale if:

  • the seller purchased the property on or after 1 October 2015 through to 28 March 2018 inclusive and owned it for less than two years 
  • the seller purchased the property on or after 29 March 2018 and owned it for less than five years
  • the property disposed of is New Zealand residential land 
  • the seller is an offshore RLWT person.

How to check if RLWT needs deducting

You cannot deduct RLWT with a signed residential land withholding tax declaration - IR1101 and supporting documents from the seller. You'll need the same for companies, trusts and limited partnerships.

When the seller does not give an IR1101 form

If the seller does not give you an IR1101 or it's incomplete, assume they're an offshore RLWT person. They'll need to meet other withholding requirements.

This means you deduct RLWT from the residential land purchase amount. This will ensure you avoid any penalties as the withholder.

Deduct RLWT before any other payments

You'll need to calculate, deduct and pay RLWT to us before any other payments are made. The only exceptions are payments to cover:

  • any mortgage or other security with a New Zealand-registered bank or licensed non-bank deposit taker against the property
  • outstanding local authority rates.