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  1. #31
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    Quote Originally Posted by fungus pudding View Post
    I've never heard of that and don't understand it. On a sale tax is paid on depreciation that has been claimed, but then recovered; so it's hard to imagine how any tax could be calculated when no claim was made and therefore nothing recovered. I think you've got something a bit haywire there.
    I have heard of this and it is stated in various IRD publications, but have never heard of an example of the IRD enforcing the point where no 'application not to depreciate' has been filed.
    Death will be reality, Life is just an illusion.

  2. #32
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    Quote Originally Posted by fungus pudding View Post
    Not that simple. Being a landlord is ]NOT[/U] a business in the eyes of the IRD.
    That's correct, the IRD 'expectation' is that you have multiple properties in order to be in the 'business'. Having a single property is not deemed to be 'in business'...
    Death will be reality, Life is just an illusion.

  3. #33
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    Quote Originally Posted by Steve View Post
    That's correct, the IRD 'expectation' is that you have multiple properties in order to be in the 'business'. Having a single property is not deemed to be 'in business'...
    That still doesn't qualify. The IRD do not recognise renting residential property as being in business.

  4. #34
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    Default re: definition of in business

    well it depends on the circumstances..it can never be one size fits all. the act is not clear on the definition of business so it is subject to case law. the IRD will apply whats known as the business reality test which holds legal precedent in NZ, which is defined in the case of [Grieve v Comissioner of Inland Revenue] for anyone that is interested...but for the purpose of deductions all that is needed is a nexus between income and expenditure which exists in rental properties.

    this was the concept as understood by Craig Eliffe who is the Professor of Tax at the University of Auckland, former partner KPMG and a current partner of Chapman Tripp, hope this helps.

  5. #35
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    Default Apologies to Dubdee.

    Quote Originally Posted by fungus pudding View Post
    I've never heard of that and don't understand it. On a sale tax is paid on depreciation that has been claimed, but then recovered; so it's hard to imagine how any tax could be calculated when no claim was made and therefore nothing recovered. I think you've got something a bit haywire there.
    Just had a look through IRD rules, and you are right - I'm wrong :o Been a long time since I've been involved in residential rentals, preferring commercial stuff these days, but it looks like a few policies heve changed. I presume thesame applies to commercial/industrial, although I can't imagine anyone with commecial investments waving their depreciation claim. Seems an illogical ruling, but it's there alright.

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