Property Taxation – New Registration Requirements, Oct 2015
The Government has recently passed new legislation that from 1 October 2015 all persons selling or purchasing residential land are required to complete a tax statement as part of the transaction.
The statement will include the persons IRD number and in certain circumstances further information. There are some transactions which will be exempt, principally those which are transferring or acquiring a residential property that was used or is to be used as that persons main home.
The Legislation is called the Taxation (Land Information and Offshore Persons Information) Act 2015.
The most important change is that no transfer can be signed off and registered until the tax statement is completed. This requirement relates to all agreements that were entered into from 1 October 2015 onwards. It does not apply to any agreements signed before 1 October 2015 provided registration of the transaction is completed by 1 April 2016.
The one transaction where the requirement to have an IRD number has change for a residential sale or purchase is that involving a family trust. To be able to complete either a sale or a purchase on behalf of a trust where the agreement was entered into after 1 October 2015 the trust will need to have an IRD number. All trustees will be required to sign a tax statement.
If your trust is planning to sell or purchase a residential property and does not have an IRD number, we recommend you apply immediately for a trust IRD number.
If you would like more information on the new registration requirements, please contact either John Stirling or Mike Newdick.
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