The Government has released a Supplementary Order Paper (SOP) which proposes changes to the ability of residential property investors to deduct the cost of their loan interest when it comes time to file a tax return.
Supplementary Order Paper No 64 - New Zealand Legislation
The Government wants to stimulate the supply of housing, so the proposals also exempt property development and new builds from the interest limitation rules.
The proposals will be considered by Parliament and may change.
These information sheets have more details about the proposed rule changes:
Interest deductibility proposals at a glance
Properties not affected by the interest deductibility proposals
How the rules work for certain entities
Exemptions for property development and new builds
How interest deductions are affected
Changes to the bright-line property rule
The Finance and Expenditure Committee will consider the proposals contained in the SOP and will call for submissions on the proposals.