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Income Tax Act 2007

Recharacterisation of certain transactions - Transfers of relationship property

FB 7: Land with standing timber

You could also call this:

"Selling land with trees as part of a relationship settlement"

Illustration for Income Tax Act 2007

You have land with standing timber that you are transferring as part of a relationship property settlement. The standing timber is not just ornamental or incidental trees, and you have a certificate to prove this under section 44C of the Tax Administration Act 1994. This transfer is treated like a sale, where you are selling the land and the buyer is buying it. You are considered to have sold the land for a price equal to what the timber was worth to you on the day of the transfer. This is important for tax purposes, as explained in section CB 25 (Disposal of land with standing timber). The transfer is like a normal sale, with a buyer and a seller, and a price that is the value of the timber.

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View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=DLM1516341.

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Topics:
Money and consumer rights > TaxesHousing and property > Buying and selling homesFamily and relationships > Marriage and partnerships
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"Transferring timber or the right to cut it down in a relationship settlement"

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Part FRecharacterisation of certain transactions
Transfers of relationship property

FB 7Land with standing timber

  1. This section applies for the purposes of section CB 25 (Disposal of land with standing timber) when—

  2. land with standing timber on it is transferred on a settlement of relationship property; and
    1. the standing timber does not consist of ornamental or incidental trees, as evidenced by a certificate given under section 44C of the Tax Administration Act 1994.

      1. The transfer is treated as if—

      2. it were a disposal and acquisition for consideration; and
        1. the amount of consideration were equal to the total cost of timber to the transferor at the date of transfer.

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