Forum Archive Index - January 2000

["Mike Hudson" <mikehudson@clear.net.nz>]

New Zealand is a bit of an oddball in this area. We do not have a capital
gians tax and therefore the individual investor will not be taxed on share
market dealings unless the Inland Revenue classes you as a "trader"  The
question is what is the difference between an investor and a trader?

The key criteria would appear to be;
1. What was the purpose of the investment? If you bought the shares to sell
and clear a quick profit e.g. in a stagging situation you could be classed
as a trader.

2. if you buy and sell on a regular basis you could also be classed as a
trader. The Rangitira case would suggest that over five trades a year could
constitute trading.

Having said that under the current regime a small player would be
exceedingly unlucky to come to the attention of Her Majesty's Tax
Inspectors.

There is pf course the other side of the coin: in a falling market it may be
advantageous to be classified as a trader as losses would be tax deductible.

I hope this helps. This is a layman's perspective, if you really want the
"good oil" you need to speak to a tax accountant

Mike H












-----Original Message-----
From: Barney <cafe@enternet.co.nz>
To: sharechat@sharechat.co.nz <sharechat@sharechat.co.nz>
Date: Wednesday, 12 January 2000 7:22 AM
Subject: [sharechat] <no subject>


>I am new to the sharemarket, is someone able to tell me, do we have to pay
>tax on profits from sharemarket trading ?
>Also like ghj, I'm interested to know where information can be found on the
>unlisted securities market ?
>
>Thanks for your help
>
>BH
>
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