The Government has confirmed that new builds will be exempt from the planned changes to the tax treatment of residential investment property. The intention to limit the deductibility of interest on residential investment property will not apply to new builds. At the time of writing, no legislation had been drafted, however indications are that new builds would be classed as a self-contained dwelling with its own kitchen and bathroom and has a code compliance certificate. Other residential property proposed to be excluded from the planned changes are employee accommodation, farmland, commercial accommodation, retirement villages/rest homes and the family/main home.
The KiwiSaver year runs from 1st July to 30th June. To claim the full amount of the member tax credit $521.43 you must have contributed $1,042.86 for the year ended 30 June 2021 (the $1,042.86 does not include employer contributions). If you have a salary of at least $34,800 and contribute at 3% then you will automatically have contributed the required $1,042.86, but you can also make voluntary contributions to get to the total of $1,042.86 if necessary. To be eligible for the member tax credit a person must be over 18, live mainly in New Zealand and are not yet eligible to withdraw from KiwiSaver (which typically occurs when reaching the age of 65 years).
Self-employed people and other individuals who received a Covid-19 wage subsidy or leave support payment must account for this income in their income tax returns if the payments did not pass through the PAYE system. This includes anyone who received a subsidy payment without tax deducted at source such as partners, trustees, students, owners of look-through companies, and home-based childcare providers. These payments are not subject to GST or ACC and should not be included in a GST return. However, GST must be accounted for on Resurgence Support payments.
The IRD is now issuing bright-line campaign letters as they become aware of potential bright-line transactions. This is usually within a month of the transaction and is posted in the myIR portal.
The IRD is also issuing real estate agent campaign letters to ensure that real estate agents claim only appropriate amounts of valid expenditures in their tax returns.