FIRSTMATE BLOG: CAPTAINS LOG

New Tax Rules for Holiday Homes5.08.2013

Inland Revenue has just released a factsheet setting out the new tax rules that apply to “mixed-use” asset holiday homes from the 2013/14 income year.

A holiday home will be a mixed use asset if the property is used both for private use and income-earning use, and it’s also unoccupied for 62 days or more.

Note that the new rules do not apply to residential properties used for long-term rental, or a home office and where the expense claim is based on floor area.

The factsheet details the two exemptions: income from income-earing use is less than $4,000 per year, or the property makes a loss and the income from the income-earning use is less than 2% of the rateable value of the property.

The factsheet contains a useful worked example of the new calculations required for a mixed-use holiday home.

Refer to IRD’s factsheet

Posted: August 5, 2013
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