Misleading talk will lead to bad tax decisions

NZPIF says deputy commissioner of Inland Revenue Robin Oliver confirmed back in 2007 that rental property does not have a tax advantage over other investments or businesses.  

When asked by a government select committee if there were some tax advantages for investments in rental housing, Oliver replied that "the short answer is there is none".

"Rules about expenses for deducting costs such as interest, upkeep and maintenance, as well as paying tax on income were the same for investments in shares or anything else. In fact under the housing case, the capital gains boundary is brought back a bit. There are tighter rules to what is a capital gain."

Many businesses make a loss during the first few years while getting established and rental property is no different. The rental market is extremely competitive and tenants enjoy lower rents because of this, helping them to save for a deposit on their own home.