Property tax law bill introduced

  • 24/08/2015
Property tax law bill introduced

The Government has introduced a bill designed to make sure people who buy and sell property pay tax on their gains.

Current tax law says they should but it's been difficult to enforce.

The Government has previously announced its intention to tighten the rules.

The new bill will set up a "bright-line" test, which makes it clear all property buyers, including overseas buyers, who buy and sell a residential property within two years will be taxed on their gains.

Revenue Minister Todd McClay says exceptions include the sale of an owner's main home, inherited property or the transfer of property in a relationship settlement.

The Bill also has an anti-avoidance rule to stop companies or trusts being used to circumvent the test.

It defines certain terms to make it easier for people to understand their responsibilities when selling a property.

The Taxation (Bright-line Test for Residential Land) Bill will go on Parliament's agenda for a first reading.