EXTENSION TO BRIGHT LINE TEST ON THE WAY
Legislation which will extend the bright line test on residential property sales from two years to five years is about to enter Parliament.
Revenue Minister Stuart Nash today confirmed he is introducing a Supplementary Order Paper to the Taxation (Annual Rates for 2017-18, Employment and Investment Income, and Remedial Matters) Bill to give effect to the changes.
The previous National government introduced the bright line test which requires income tax to be paid on any gains from residential property sold within two years of acquisition, with some exceptions.
Nash says the extension means that profits from residential investment properties which are bought and sold within five years will generally be taxable.
The changes, which were signalled by the Labour Party prior to last year’s election, will help dampen property speculation and make homes more affordable, he says.
"It will ensure that property speculators pay income tax on their gains and makes property speculation less attractive.
“We need investment which grows the economy and creates jobs, not the sort of investment which distorts the residential housing market.”
Not only will the measure bring fairness back into the tax system, but reducing speculative demand will help improve housing affordability for owner-occupiers, Nash says.
Current exemptions from the bright line test will remain. They include the sale of an owner-occupier’s main home, inherited property, or the transfer of property in a relationship settlement.
The extension to the bright-line test will apply to residential investment properties purchased from the date on which the bill receives the Royal Assent, which is expected in March.
Nash adds that the passage of the bill will also enable the Tax Working Group to factor the change into any consideration of a comprehensive capital gains tax.
Auckland Property Investors Association president Andrew Bruce has previously said that the changes will impact on property speculators rather than long-term investors.
"The majority of property investors are in it for the longer than five years and are unlikely to feel massive levels of pain with the extension of the bright line test."
Poll: Would you rather: Christmas in summer forever or winter forever?
Just a bit of a fun poll to get you thinking.
If you had to live out your Christmas days, would you prefer it was a summer Christmas or a winter Christmas?
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63.1% Summer
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35.6% Winter
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1.3% Other - I'll share below
Share your summer photos! 📷
Taken some beautiful snaps lately? Whether it's rainbows, sunsets or a beautiful summer's day, we'd love you to share the joy with us.
Share a photo in the comments below
⚠️ DOGS DIE IN HOT CARS. If you love them, don't leave them. ⚠️
It's a message we share time and time again, and this year, we're calling on you to help us spread that message further.
Did you know that calls to SPCA about dogs left inside hot cars made up a whopping 11% of all welfare calls last summer? This is a completely preventable issue, and one which is causing hundreds of dogs (often loved pets) to suffer.
Here are some quick facts to share with the dog owners in your life:
👉 The temperature inside a car can heat to over 50°C in less than 15 minutes.
👉 Parking in the shade and cracking windows does little to help on a warm day. Dogs rely on panting to keep cool, which they can't do in a hot car.
👉 This puts dogs at a high risk of heatstroke - a serious condition for dogs, with a mortality rate between 39%-50%.
👉 It is an offence under the Animal Welfare Act to leave a dog in a hot vehicle if they are showing signs of heat stress. You can be fined, and prosecuted.
SPCA has created downloadable resources to help you spread the message even further. Posters, a flyer, and a social media tile can be downloaded from our website here: www.spca.nz...
We encourage you to use these - and ask your local businesses to display the posters if they can. Flyers can be kept in your car and handed out as needed.
This is a community problem, and one we cannot solve alone. Help us to prevent more tragedies this summer by sharing this post.
On behalf of the animals - thank you ❤️
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