Property problems: Tax law on property transactions complex

le? Will I be taxable on any (capital) gain on the eventual resale of any of the long-term rental properties?

A. As the IRD's October media release states, the tax law on property transactions is complex and people need to seek professional advice.

At its simplest, where real property is bought to resell, any profit realised on sale is subject to tax.

Conversely, if such a property is sold at a loss, that loss is deductible (although documentary evidence that the property was bought for the purpose or intention of resale may be required to support the deduction). Incidentally, this is also the case if it is personal property, not land which is bought and sold.

Even if a particular piece of land was not purchased for resale but for a long-term hold (say, to rent), and the property is resold within 10 years, any gain on the sale (over cost) may be taxed.

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