When you're an offshore RLWT person selling a New Zealand residential property, RLWT is deducted when:
- a purchase amount is paid or payable (excluding deposits or part payments that total less than 50% of the sale amount) on or after 1 July 2016
- the property sold is in New Zealand and is residential land
- the bright-line property rule applies because you acquired and sold the property within the bright-line period.
The bright-line period is:
- 10 years for property acquired on or after 27 March 2021 or 5 years if the entire property qualifies as a ‘new build’.
- 5 years for property acquired as a result of an offer made on or before 23 March 2021 and that offer was not able to be revoked or withdrawn before 27 March 2021.
- 5 years if you acquired the property between 29 March 2018 and 26 March 2021.
- 2 years if you acquired the property between 1 October 2015 and 28 March 2018.
For properties acquired on or after 27 March 2021, where the residential land has a new build and a non-new build on the same legal title, RLWT applies to the full sale price if it is sold within 10 years
Your conveyancer deducts RLWT
Your conveyancer, such as your lawyer or law firm you use to process the sale, is your withholder and deducts RLWT for you.
If you do not have a conveyancer then the purchaser's conveyancer deducts RLWT for you.
If the purchaser does not have a conveyancer then the purchaser must withhold the RLWT for you. Before they can, you'll need to give them:
- a residential land withholding tax declaration form - IR1101
- supporting documents as stated on the form.
If you do not give them these, you may be committing an offence under the Tax Administration Act 1994.
When RLWT is not deducted
The withholder will not need to deduct RLWT from offshore RLWT persons in the following situations.
- A sale or disposal of an inherited property or relationship property settlement.
- The property transfer is from a deceased person to the executor or administrator of the estate.
- The property transfer is by an estate on the death of a person.
- The seller is a beneficiary of an estate selling/disposing of an inherited property.
- The seller holds a valid certificate of exemption.
Joint ownership and RLWT
RLWT is deducted differently for a jointly owned property. An offshore RLWT person will only have RLWT deducted from their share of the property sale profit.
Your withholder can use our RLWT calculator to work out how much to deduct.
This tool will help a withholder work out the RLWT to deduct and pay to us.Go to this tool
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