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Income Tax Act 2007

Recharacterisation of certain transactions - Transfers of relationship property

FB 1C: Obligations for periods before and from transfer of property

You could also call this:

"Tax responsibilities when getting a property from someone else"

Illustration for Income Tax Act 2007

You are responsible for tax obligations for a property before it is transferred to you. When a property is transferred to you as part of a relationship property settlement, you are treated as if you bought it for the same price the other person paid. You are also treated as if you owned it from the date they bought it and for the same reasons they had 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=DLM6759417.

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Part FRecharacterisation of certain transactions
Transfers of relationship property

FB 1CObligations for periods before and from transfer of property

  1. A transferor of property on a settlement of relationship property remains responsible for all tax obligations relating to the property and the period ending immediately before the transfer.

  2. In determining the tax obligations relating to property transferred on a settlement of relationship property and the period beginning with the transfer,—

  3. the transferee is treated as—
    1. acquiring the property at the cost of the property to the transferor; and
      1. acquiring the property on the date on which the transferor acquired the property; and
        1. acquiring and holding the property with the status, intention, and purpose of the transferor in relation to the property:
        2. the transferor is treated as having not owned the property.

          1. Sections FB 2 to FB 21 override this section.

          Notes
          • Section FB 1C: inserted (with effect on 1 April 2008 and applying for the 2008–09 and later income years), on , by section 165(1) of the Taxation (Annual Rates for 2015–16, Research and Development, and Remedial Matters) Act 2016 (2016 No 1).