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Income Tax Act 2007

Recharacterisation of certain transactions - Transfers of relationship property

FB 2: Personal property

You could also call this:

"Tax rules for personal property in relationship settlements"

Illustration for Income Tax Act 2007

When you transfer personal property as part of a relationship settlement, it affects your taxes. You treat the transfer as if you sold the property and the other person bought it for its original cost. If the person who gets the property then sells it, they are considered to be in the business of selling that type of property.

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View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=DLM1516331.

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Topics:
Money and consumer rights > TaxesFamily and relationships > Marriage and partnerships
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FB 1C: Obligations for periods before and from transfer of property, or

"Tax responsibilities when property is transferred during a relationship settlement"

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FB 3A: Residential land, or

"Transferring your home to someone as part of a relationship split"

Part FRecharacterisation of certain transactions
Transfers of relationship property

FB 2Personal property

  1. This section applies for the purposes of sections CB 4 (Personal property acquired for purpose of disposal) and CB 5 (Business of dealing in personal property) when personal property, or an interest in personal property, is transferred on a settlement of relationship property.

  2. The transfer is treated as a disposal and acquisition of the property for an amount that equals the cost of the property or, as applicable, the interest in the property, to the transferor.

  3. If, after the transfer, the transferee disposes of the property, they are treated in relation to the disposal as carrying on a business of dealing in the property.

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