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Dates of purchase and sale
For bright-line and residential land withholding tax
Use these dates to work out if your residential property sale falls within the five year bright-line purchase and sale period (two years for property purchased on or after 1 October 2015 through to 28 March 2018 inclusive).
These dates are also used to work out the purchase and sale period for residential land withholding tax (RLWT) purposes.
These dates do not determine the date when the liability to deduct RLWT occurs, see sale amount date.
Purchase/acquisition of property
Use the table below to work out the date to use depending on the situation in which your property was purchased/acquired:
|Type of purchase/acquisition||Date to use|
|Purchase of property||Date of registration with Land Information New Zealand (LINZ) If the property is in another country, it's the date the transfer was registered under that country's laws.|
|Purchase where no registration occurs prior to the sale/disposal date||Latest date that you acquired an interest in the property|
|Acquiring property by way of subdivision where registration of the undivided property has occurred prior to the sale/disposal date||The original date of registration for the undivided property|
|Acquiring property by way of subdivision of property where no registration of the undivided property occurs prior to the sale/disposal date||The latest date you acquired an interest in the undivided land|
|Land acquired as the result of the completion of a land development or subdivision where acquisition was contingent upon completion||The date you acquired an interest in the property|
|Freehold estate converted from a lease with a perpetual right of renewal||The date the leasehold estate was granted|
Sale/disposal of property
Use the table below to work out the date you need to use depending on the situation in which your property was sold/disposed of.
|Type of sale/disposal||Date to use|
|Sale, transfer or disposal of property under an agreement||Date you entered into an agreement for sale, transfer or disposal|
|Gifting of property||Date the gift was made|
|Compulsory acquisition by the Crown, a local authority or a public authority||Date of compulsory acquisition|
|Mortgagee sale||Date the property is disposed of, by, or for the mortgagee as a result of the mortgagor's default|
|Disposals not covered above||Date you disposed of the property|
|Note: if more than one type of sale/disposal applies, use the earliest date|
Change in the bright-line period from two years to five years
On 29 March 2018 the bright-line purchase and sale period changed from two years to five years. Properties purchased on or after 1 October 2015 through to 28 March 2018 inclusive, will have a bright-line period of two years. Properties purchased on and after 29 March 2018 will have a bright-line period of five years.
This change applies to properties when an agreement to purchase was entered into on or after 29 March 2018. This is not necessarily the same as the start date for the bright-line sale and purchase period, see the examples below.
If you purchased or entered into an agreement to purchase a property around this date, it is important that you work out the correct purchase date to determine the bright-line purchase and sale period that applies to you.
This change also applies to the purchase and sale period for RLWT purposes.
Helen has been watching the rental market closely lately and has decided to purchase a residential property as a rental investment. She finds a suitable property and signs a sale and purchase agreement on 28 February 2018. The purchase is completed and registered with LINZ on 1 April 2018.
As the date Helen acquired an interest in the property is before 29 March 2018 (date that she signed the sale and purchase agreement with the seller), the bright-line test will apply to the sale of this property if it is sold within two years from when the transfer of title was registered with LINZ (1 April 2018).
Siobhan has also found a residential property she is interested in purchasing as a residential rental investment. Siobhan enters into an agreement to purchase the property subject to a builders report, and signs a sale and purchase agreement on 1 April 2018. The purchase of the property is registered with LINZ on 28 April 2018.
As Siobhan acquired an interest in the land after 29 March 2018 (date the sale and purchase agreement was entered into), the bright-line test will apply to the sale of this property if it is sold within five years. The start date for the five year period in Siobhan’s case is the 28 April 2018 (date the purchase of the property is registered with LINZ).