ozharp,
if that's want you really want , then go for it..! there's nothing wrong with your decision for new zealand is a nice place to live in..
i have some info here..hope it can help you
New Zealand's Tax Regime for Property Investment.
New Zealand has no sales tax on property or mortgage transactions. The only direct property taxes are property rates which are levied by local Councils to provide Council services such as roads, water, rubbish collection and community services such as libraries. Rates are based on the value of the property and would vary between NZ$1500 and NZ$3000 per annum for a typical median value house.
New Zealand allows unlimited deductiblity of property losses against other New Zealand income, obviously including rental income. This includes depreciation of buildings and fittings. If there is no other New Zealand income to off-set the loss then losses are carried forward.
Other deductions typically made by New Zealand property investors are:
- mortgage interest, not capital repayments
- insurance of the property
- property management fees repairs and maintenance; but not improvements, these have to be capitalised and depreciated.
- accountancy fees
- valuation fees
- bank fees
- property rates
- lawyer fees associated with financing, not purchase of the property
- relevant magazines, books at fees for Property Investment courses
- reasonable travel and expenses for managing property portfolio – your next New Zealand holiday could become a tax deduction!
Which banks in New Zealand are everyone dealing with? Are there any that you should stay clear of?
Thanks
Banks are generally looking for 30% deposit from Aussies and 20% from Kiwis who already own investment properties. Investors are REALLY struggling to get finance here at the moment and your best bet is to use a broker who will target specific lending institutions based on your situation.
If you would like a broker recommendation, I am happy to hook you up with broker who specializes in funding investors. PM me for details.
Vicky.
henry13auckland wrote:About income tax and capital gain tax issue regarding property in NZ:
I have a house in Auckland which is my home before I move to Australia in 08. I could not sell it for more than one year as at that time people stopped buying properties. I rent it out and am incurring the loss every month.
I did not claim any loss from my OZ income until I saw this post. So I can claim the loss from my OZ income!? How about capital gain tax? I intend to sell it in the next 2 years if there is small booom there. I hear it is still hard to sell at this moment. Need I pay tax to ATO here if there is capital gain there?Any reliable resouce I could find out more about NZ properties owned by people in Australia?
Henry
The short answer is yes, you can claim any loss on your foreign income against Australian income. Prior to 1 July 08, you could only offset the losses against foreign income of the same class (ie until you made a gain on your rental property in NZ). If you have a loss in the 2009 year of under 10k, claim the entire amount against your oz income. If the loss exceeds 10k you can only claim part. If you fall into this category. Get an oz accountant to do your return. Im a Chartered Accountant and still find international tax a complex area.http://ato.gov.au/individuals/content.asp?doc=/content/00107951.htm&page=6&H6
re Capital gains tax on your NZ property – as an Australian tax resident (assuming you are?), you will be taxed on your capital gain at whatever your Australian marginal rate is. So while NZ has no cap gains tax, this is irrelevant to you as an Australian tax resient. You'll still be assesed here. Note, if youve held the property for more than a year you are entitled to claim the 50% CGT discount. ie your capital gain will only be half of the actual gain. This doesnt apply to losses.
Hope this helps.
Josh
urbanedge wrote:ozharp,if that's want you really want , then go for it..! there's nothing wrong with your decision for new zealand is a nice place to live in..
i have some info here..hope it can help you
New Zealand's Tax Regime for Property Investment.
New Zealand has no sales tax on property or mortgage transactions. The only direct property taxes are property rates which are levied by local Councils to provide Council services such as roads, water, rubbish collection and community services such as libraries. Rates are based on the value of the property and would vary between NZ$1500 and NZ$3000 per annum for a typical median value house.
New Zealand allows unlimited deductiblity of property losses against other New Zealand income, obviously including rental income. This includes depreciation of buildings and fittings. If there is no other New Zealand income to off-set the loss then losses are carried forward.
Other deductions typically made by New Zealand property investors are:
- mortgage interest, not capital repayments
- insurance of the property
- property management fees repairs and maintenance; but not improvements, these have to be capitalised and depreciated.
- accountancy fees
- valuation fees
- bank fees
- property rates
- lawyer fees associated with financing, not purchase of the property
- relevant magazines, books at fees for Property Investment courses
- reasonable travel and expenses for managing property portfolio – your next New Zealand holiday could become a tax deduction!
Parts of your info above are not correct, particually with the changes anounced in the May 2010 NZ budget.
Please see our recent 'post budget' blog post to see some of the changes, around depreciation, and ability to claim losses etc
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