Tax/GST/LTC Expert

Ask Mark Withers, director of Withers Tsang & Co questions relating to Tax and Asset Structures

Mark Withers and his team at Withers Tsang & Co specialise in advising on property related transactions, valuation and restructure services and tax planning.

Rental transfer to LC

David asks:

I have seen the various answers with respect to transferring rentals to LTC, but I would like to ask it from a different approach.

My wife and I have a couple of rental properties acquired a number of years ago, and did not at the time set up a company for them. (This was about 20 years ago, and we were both overseas). Now we are back in the country and we are looking the possibility of moving the rental properties to a Limited Company (not a LTC).

The aim of this is to make tax reporting easier, to clarify the tax structure, and to provide a future platform for more investment purchases in the future. But would the IRD see this as tax avoidance, as we are not looking at the LTC setup to pass losses (if there are any) on to our own income?

We would be selling them to the company at the value that would cover the current mortgages on them and to cover the historical deprecation on those properties

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Lack of IRD knowledge

Fern asks:

I have a rental property and I have only just discovered that I should be declaring this income with IRD. I never classed it as an income as it has cost me money every year. I have investigated everything and I have fully completed my own tax returns for the last six years. What advice can you give me on how I approach the IRD about this? Do I need to write a letter explaining my lack of knowledge? What is the best approach?

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Tax deductibility for rental

Kylie asks:

I have been renting out my property while I have been travelling around NZ.

I know my rental will make a loss this year.

Am I able to off-set these losses again any personal NZ income that I have earned in 2015 to receive a tax refund?

I haven't set up a company for rental property as I only have the one property.

However, it is being privately managed by an rental agent.

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