[suebeenz]

I haven't taken ownership of the house yet, but it did recently go unconditional. Now there's another buyer lined up who is very serious about buying it from me (a bit annoying after humming and hawwing for so long about the 'perfect house'). :)

I was planning on holding for many years, but the offer is somewhat tempting. Think I could get away from taxation on the gains since it wasn't my original 'intent' (I don't know how you really prove your 'intent' to the gov)

[Super_BQ]

When you see your lawyer that facilitates the land deal, that is when you declare the reason for buying the property which goes on IRD's record.

NZ is pretty harsh in respect to taxing capital gains. Every $1 of gain is taxed as a dollar of earned income.

I suppose it depends on how good of a lawyer you have that can play turkey? Most lawyers in NZ will not bend the rules. What I would look at is asking how soon does this person want your house?

You know i've heard of cases (in Canada) where a new home owner had moved out within a few weeks because the neighbors didn't like him. The reason? because he was chinese and the neighbors did not like asians - feared for his life. When the tax dept. followed up, the auditor completely understood the situation. Of course it helps if you have a police complaint file to go with that reason.

Can something like this happen in your case? Perhaps so if you and your neighbors are good Hollywood actors. Being a visable minority is a pre-requisite

BQ

[willowshouse]

Tricky one, because from what I can tell it could go either way.

Everyone is entitled to change their mind and sell a house fairly quickly after they bought it but if you sell it for a lot more money then there probably will be questions asked. Probably different if you held onto it for a few months before you decided you didn't want to live there - then the increase could just be explained as you bought well and sold well. Even if they believe that your initial intention was to live in the property, you have effectively changed your intention before you even own the property. I'm no expert but if I were in your shoes I would bank on having to pay the tax and then if you don't have to you'll be happy.

Good luck,
Dawn

[eternalkiwi]

Officially intention is the key fact. Though it is also your responsibility to prove intent to IRD.

As this is a one-off event you are not likely to be considered in business, so you most likely would be safe, but if you did this semi-regularly then you would be likely to pay tax on your gain.

[suebeenz]

Thanks everyone for the responses. Followed up with a solicitor and he assured me that I wouldn't have to pay capitals gains. I think as suggested above, think it comes down to intent lodged with solicitor. However, I'm sure if IRD suspects otherwise, they can do whatever they want.

Now, selling privately is the next question :-)