Plain language law

New Zealand law explained for everyone

Income Tax Act 2007

Deductions - Specific rules for expenditure types

DB 29: Apportionment when land acquired with other property

You could also call this:

“How to calculate land cost when bought with other property”

If you sell land and make money from it, you need to know how much the land cost you. Sometimes, you might have bought the land along with other things. In this case, you need to figure out how much of the total cost was for the land itself.

This rule applies when you earn money from selling land in certain situations. These situations are described in other parts of the law, which you can find in sections CB 6A to CB 14.

When you bought the land with other property, you must split the total cost between the land and the other things you bought. This helps you work out the actual cost of the land, which is important for calculating how much money you made when you sold it.

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View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=DLM1513645.

Topics:
Money and consumer rights > Taxes
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“Money from selling land affected by change can be deducted if not already counted as income”

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Part D Deductions
Specific rules for expenditure types

DB 29Apportionment when land acquired with other property

  1. If a person derives income under any of sections CB 6A to CB 14 (which relate to the disposal of land) from the disposal of land, and the land is acquired together with other property, the cost of acquisition must be apportioned between the land and the other property.

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Notes
  • Section DB 29: amended, on , by section 127 of the Taxation (Annual Rates for 2023–24, Multinational Tax, and Remedial Matters) Act 2024 (2024 No 11).
  • Section DB 29: amended (with effect on 27 March 2021), on , by section 29 of the Taxation (Annual Rates for 2020–21, Feasibility Expenditure, and Remedial Matters) Act 2021 (2021 No 8).