Plain language law

New Zealand law explained for everyone

Income Tax Act 2007

Income - Income from holding property (excluding equity)

CC 1: Land

You could also call this:

“Income you can earn from owning land”

If you own land, you can earn income from it in different ways. You can get money from someone who wants to use your land. This can happen if you let them lease the land, give them a licence to use it, or allow them an easement (which is a right to cross or use part of your land). You can also earn money by letting someone take profits from your land.

The money you can earn from your land includes rent, fines, premiums, payments for the goodwill of a business, payments for the benefit of a licence or privilege granted by the government, and other types of income.

However, some amounts of money you get from using your assets are not counted as rent or income from your land. These special cases are described in section CW 8B.

If you lease your property to someone you’re related to and charge them less rent than you should, there are special rules about this. These rules are explained in section GC 5.

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View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=DLM1512507.

Topics:
Money and consumer rights > Taxes
Housing and property > Land use
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Part C Income
Income from holding property (excluding equity)

CC 1Land

  1. An amount described in subsection (2) is income of the owner of land if they derive the amount from—

  2. a lease, licence, or easement affecting the land; or
    1. the grant of a right to take the profits of the land.

      1. The amounts are—

      2. rent:
        1. a fine:
          1. a premium:
            1. a payment for the goodwill of a business:
              1. a payment for the benefit of a statutory licence:
                1. a payment for the benefit of a statutory privilege:
                  1. other revenues.

                    1. Despite subsections (1) and (2), an amount referred to in section CW 8B (Certain amounts derived from use of assets) is not a payment of rent or another amount for the purposes of this section.

                    2. Repealed

                    3. The treatment of leases of property to related parties for less than an adequate rent is dealt with in section GC 5 (Leases for inadequate rent).

                    Compare
                    Notes
                    • Section CC 1(2B) heading: inserted (with effect on 1 April 2013 and applying for the 2013–14 and later income years), on , by section 6(1) of the Taxation (Livestock Valuation, Assets Expenditure, and Remedial Matters) Act 2013 (2013 No 52).
                    • Section CC 1(2B): inserted (with effect on 1 April 2013 and applying for the 2013–14 and later income years), on , by section 6(1) of the Taxation (Livestock Valuation, Assets Expenditure, and Remedial Matters) Act 2013 (2013 No 52).
                    • Section CC1(2C) heading: repealed (with effect on 1 April 2015), on , pursuant to section 85 of the Taxation (KiwiSaver, Student Loans, and Remedial Matters) Act 2020 (2020 No 5).
                    • Section CC1(2C): repealed (with effect on 1 April 2015), on , by section 85 of the Taxation (KiwiSaver, Student Loans, and Remedial Matters) Act 2020 (2020 No 5).