Current Category: Taxation
Depreciation - Not All is Lost
How to take full advantage of the new taxation system post Budget 2010:
Given some of the media coverage of the recent 2010 Budget you may understandably think property depreciation is dead in the water. But this is not so. Far from it!
Investors who write-off all depreciation next financial year will be missing some significant claim opportunities. If you haven't bothered with a split purchase depreciation schedule in the past - it is now time to give it serious consideration based on th...
posted in: Chattels valuation, Inland Revenue Department , Budget 2010, Depreciation, Taxation
IRD: Deductions you can and can't claim
What you can claim
The following expenses can be deducted from your rental income:
rates and insurance
interest paid on money borrowed to finance your property
agents fees and commission relating to the rental of the property
repairs and maintenance (except if they substantially improve the property)
motor vehicle and travel expenses
legal fees for arranging the mortgage or finance to buy the property
from the 2010 income year and beyond legal fees for buying and selling a property c...
posted in: Inland Revenue Department , Property Investment Basics, Accounting, Taxation
IRD: If you are not clear on your intentions for buying a property
Make sure you read the IRD guide on Building and selling residential property.
If you are buying and selling property other than a private family home, we recommend you get advice from a tax advisor with expertise in this area.
posted in: Investor, Speculator or Dealer?, Property Dealing vs Property Investing , Inland Revenue Department , Tax status , Taxation
IRD: Factors to consider when determining your tax status
Three main factors can determine your status as a property buyer for tax purposes:
Your intention when you buy a property;
The patterns of your previous property transactions; and
Your association to a builder, property dealer or developer. The category you fall into isn't determined by what the property is called or how the activity is described. For example, it may be marketed as "rental investment" with strong "capital gain" potential, but your firm intention or prior pattern is the fa...
posted in: Investor, Speculator or Dealer?, Property Dealing vs Property Investing , Capital Gains Tax , Capital Gain, Inland Revenue Department , Governmental & Regulatory, Tax status , Depreciation, Taxation
IRD: What is an investor, a speculator and a dealer?
INVESTOR
If you are an investor you buy a property to use it to generate ongoing rental income and not with any firm intent of resale. The property is a capital asset and any later profit or loss from selling the property is capital and is not taxable (apart from clawing back any depreciation, which is now recoverable).
Property investors sometimes refer to a "buy and hold" strategy. This approach is most likely to mean you are a property investor for tax purposes.
Investors will inve...
posted in: Investor, Speculator or Dealer?, Property Dealing vs Property Investing , Capital Gains Tax , Capital Gain, Inland Revenue Department , Governmental & Regulatory, Tax status , Taxation
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