Forum Archive Index - July 2001

["tennyson@caverock.net.nz" <tennyson@caverock.net.nz>]

> 
> Sorry to get of the subject of shares but I have just
> received a query from a mate in Aust who owns a house
> there and is looking at renting it while he comes back
> to NZ for work.
> 
> I am presuming that
> he will have to pay tax in Aust on any net income 
> (paid at non resident rates) while he is in NZ
> 
> Anybody know any more?
> 
>
I think the answer to this question depends on how long the mate in 
Australia is coming back to New Zealand for.   This will determine 
whether he is classed as an Australian or New Zealander for tax 
purposes.

Once he knows which country he will be classified for tax purposes as 
living in, then he pays tax in that country according to 'home 
rules'. NZ and Australia have certain reciprical taxation 
arrangements.

I am not sure what witholding tax regulations as regards rental 
property rent payments exist in Australia.   But if any such 
regulations do exist, you paint it as though your mate will be paying 
tax twice, once in NZ and once in Australia.   I am fairly sure this 
is not the case with rent for a private dwelling.  Any tax paid in 
Australia on income will be able to be deducted from that due to the 
New Zealand authorities.

If he wants to eventually sell the house though, he had better go 
back to Australia and live in it for a while.  Otherwise capital 
gains tax will be taken out of any profit on the sale.  And there is 
no offset available in the New Zealand tax system to account for 
that! SNOOPY

(disclaimer:  this answer is an amateurs understanding of the 
position, and is offered becasue no one else has.  While it is given 
in good faith, I would strongly suggest contacting an tax accountant 
in the appropriate country to clarify the position.)


---------------------------------
Message sent by Snoopy 
e-mail  tennyson@caverock.net.nz
on Pegasus Mail version 2.55
----------------------------------
"You can tell me I'm wrong twice, 
but that still only makes me wrong once."


----------------------------------------------------------------------------
http://www.sharechat.co.nz/          New Zealand's home for market investors
----------------------------------------------------------------------------
To remove yourself from this list, please use the form at
http://www.sharechat.co.nz/forum.shtml.