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Income Tax Act 2007

Income - Income from business or trade-like activities - Exclusions for residential land

CB 17: Residential exclusion from sections CB 12 and CB 13

You could also call this:

“Exceptions for work done on your residential land”

You don’t have to follow sections CB 12 and CB 13 if you’re doing work on your land to make it better for you to live there. This includes if you’re making changes or improvements to the land, or dividing it into smaller parts. It applies to you and your family members who live with you.

You also don’t have to follow these sections if you’ve split a piece of land that you own into two or more smaller pieces. This is only if the original piece of land was 4,500 square metres or less, and you or your family were mainly using it as a place to live before you divided it.

In both cases, these rules are meant to protect you if you’re making changes to your own residential land, rather than doing it as a business.

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View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=DLM1512446.

Topics:
Money and consumer rights > Taxes
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CB 16: Residential exclusion from sections CB 6 to CB 11, or

“Exemption from tax when selling your main home”

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CB 18: Residential exclusion from section CB 14, or

“Exemption for selling land bought for personal living to another person for the same purpose”

Part C Income
Income from business or trade-like activities: Exclusions for residential land

CB 17Residential exclusion from sections CB 12 and CB 13

  1. Sections CB 12 and CB 13 do not apply if—

  2. the work involved in the undertaking or scheme is to create or effect a development, division, or improvement; and
    1. the development, division, or improvement is for use in, and for the purposes of, the residing on the land of,—
      1. the person:
        1. if members of the person’s family live with them, the person and members of the person’s family living with them.

        2. Sections CB 12 and CB 13 do not apply if—

        3. the land is a lot that came out of a larger area of land that the person divided into 2 or more lots; and
          1. the larger area of land was 4,500 square metres or less immediately before it was divided and was occupied mainly as residential land for,—
            1. the person:
              1. if members of the person’s family live with them, the person and members of their family living with them.

              Compare
              Notes
              • Section CB 17(1): amended, on , by section 310 of the Taxation (Business Taxation and Remedial Matters) Act 2007 (2007 No 109).
              • Section CB 17(1)(b): replaced (with effect on 1 April 2008), on , by section 124(1) (and see section 124(3) for application) of the Taxation (Annual Rates for 2018–19, Modernising Tax Administration, and Remedial Matters) Act 2019 (2019 No 5).
              • Section CB 17(2)(b): replaced (with effect on 1 April 2008), on , by section 124(2) (and see section 124(3) for application) of the Taxation (Annual Rates for 2018–19, Modernising Tax Administration, and Remedial Matters) Act 2019 (2019 No 5).