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DB 18AB: Deduction cap: disposal of residential land within 5 years to associated persons
or “Removed rule about tax deductions when selling houses to people you know”
You could also call this:

“You can claim deductions for costs of preparing and registering leases”

You can claim a deduction for the money you spend on preparing and registering a new lease for property, or renewing an existing one. This rule applies even though these costs might normally be considered capital expenses. However, you still need to meet the general rules for claiming deductions, and other limitations may apply.

When you’re dealing with leases for property, it’s important to know that you can get some money back for the costs involved in setting them up or renewing them. This includes things like paying someone to write up the lease or paying fees to register it officially. Even though these might seem like big, one-off expenses, the law says you can claim them as deductions.

Remember, while this rule lets you claim these specific lease-related costs, you still need to follow the other rules about claiming deductions. Make sure your claim fits with the general permission rules and doesn’t break any other limitations set out in the tax laws.

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Next up: DB 19: Expenses in application for resource consent

or “Tax deductions for unused resource consent application costs”
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Part D Deductions
Specific rules for expenditure types

DB 18Transaction costs: leases

  1. A person is allowed a deduction for expenditure that they incur for the preparation and registration, or the renewal, of a lease of property.

  2. This section overrides the capital limitation. The general permission must still be satisfied and the other general limitations still apply.

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