The Minister of Finance, Hon Grant Robertson, has announced proposed changes for residential property acquired on or after 27 March 2021. The proposed changes include:
Some of these are huge proposals, especially for property investors, the standout part of this for me it the removal of being able to claim mortgage interest as an expense against the rental income, that is massive.
I don’t feel the bright line extension will make that much difference as those that are “flipping” properties usually do this within 6-12 months, so this one looks a bit empty unless I am missing something.
And the “tax to be paid on gains made for periods the property is not used as the owner’s main home” that’s going to be interesting from a compliance perspective.
Thoughts on this?