Between 2013 and 2018, during NZ’s property boom 14,588 houses were bought then sold less than 12 months later, according to OneRoof’s numbers. Flippers, or those who buy and sell property quickly for profit, made up the majority of this number.

Do you flip property for profit? Are you a property investor? The IRD is about to rejig the current rules to track property investors like you more closely. It’s vital that you ensure you’re filing your tax return correctly.

The IRD is watching property flippers

In the past, up to to one third of land transfers were made without a record of buyer or seller IRD number. The IRD’s recent rule changes have closed that loophole and now requires every buyer or seller to provide their numbers on land transfer documentation.

Revenue Minister Stuart Nash commented on the motivation behind the law change in a recent IRD media release:

“Inland Revenue needs a complete picture of property transactions to determine if tax rules are being manipulated. The requirement for nearly all land transfers to include an IRD number is a small change but improves the overall integrity of the system.”

New changes indicates that the IRD may be keeping a closer eye on investors.

What does this mean for you? 

This change (and the motivation behind it) indicates that the IRD may scrutinise all investor activity closer in future, particularly those who buy and sell quickly. This makes it even more important to ensure your return is 100% complete and accurate when tax time comes around.

If you need help getting yours done, get in touch with the team of investment property tax specialists here at Property Tax Returns.