New Zealand Property Investors' Federation

The NZPIF is the umbrella body for 20 local Property Investors' Associations throughout New Zealand.

(027) 357 9243

www@nzpif.org.nz

 

Background information

On 23 March, the Government announced that deductions for interest expenses on rental properties will be restricted from 1 October 2021. The Ministers of Finance and Revenue today released a public consultation document seeking feedback on a range of design issues for implementing that proposal, including:

  • Interest on a mortgage on a residential investment property (acquired before 27 March 2021) will be gradually phased out between 1 October 2021 and 31 March 2025. Other interest would immediately cease to be deductible from 1 October 2021.
  • Land outside New Zealand would be excluded from the new rule as would a number of other types of properties.
  • Exemptions are proposed for property developers and for owners of new builds. In addition, initial or early owners of new builds would be subject to a five year bright-line test, rather than the ten year test.

The proposals do not affect a person's main home. For more information, see:

Also available are summary sheets briefly outlining specific topics covered in the discussion document:

 

 

How to write a submssion

Property investors are encouraged to provide feedback on the removal of mortgage interest as a deductibility expense and the extension of the bright line.  Some guidance is provided here