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Income Tax Act 2007

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

CB 22: Farm land exclusion from section CB 14

You could also call this:

“Farm land sold for farming is exempt from certain tax rules”

You don’t have to worry about section CB 14 if you bought some farm land and used it (or planned to use it) mainly for farming or agriculture. This applies to you, your spouse, civil union partner, or de facto partner, or both of you together.

If you sell this land to someone else who plans to keep using it mainly for farming or agriculture, section CB 14 doesn’t apply either.

When figuring out if the person buying the land (let’s call them person B) plans to use it for farming, you can look at what happens after you sell it and other relevant information. But you can’t use the same factors mentioned in section CB 14(1) to decide this.

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View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=DLM1512460.

Topics:
Money and consumer rights > Taxes
Environment and resources > Farming and fishing
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“ Farm land sales: when you don't have to pay tax on profits ”

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CB 23: Investment exclusion from sections CB 12 and CB 13, or

“Exclusion for land improvements made to earn income”

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

CB 22Farm land exclusion from section CB 14

  1. Section CB 14 does not apply if—

  2. the person (person A) acquired the land, and they, their spouse, civil union partner or de facto partner, or both of them used or intended to use the land mainly for the purposes of a farming or agricultural business carried on by them, their spouse, civil union partner, or de facto partner, or both of them; and
    1. they disposed of the land to another person (person B) mainly for the purposes of the continuing use of the land in a farming or agricultural business.

      1. For the purposes of subsection (1)(b), person B’s purposes in acquiring the land are ascertained from circumstances of the disposal arising after person A acquired the land and other relevant matters, not including the factors described in section CB 14(1).

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