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Tax on property rental income
A transcript of the "Tax on property rental income" video.

Visual:

Inland Revenue's logo is seen against a teal background. A grey strip moves across the screen.

Audio:

"Do you receive rental income?"


Visual:

A house flips up with the title 'Rental Income' above it. The title fades and a form labelled 'Income tax return' pops up out of the roof of the house, stops, and then flies up out of the screen to show it being filed.

A bubble with a picture of a landlord, a person with a key, appears. A tick indicates the landlord is doing the right thing.

The bubble fades and a question mark appears above the house, asking whether or not you know about temporary rental arrangements.

A tenant walks into the rental property.

Audio:

"Almost all rental income is taxable, including income you receive from renting out:

  • a residential property
  • your own home
  • a room in your home to boarders or flatmates
  • a sleepout or caravan."

Visual:

A white strip flows from right to left containing a grey pie chart with a large part of it highlighted in green. The pie division changes so a small part is now highlighted green, showing you have to pay tax on long and short term rentals.

The pie divisions disappear and a 'Rental contract' is shown in the circle. A second circle showing a handshake agreement appears next to the formal rental contract.

The circles disappear, replaced by the web address for the Inland Revenue property website, http://www.ird.govt.nz/property.

Audio:

"Whether long-term or short-term.  And whether you have a formal agreement in place or not, everything you need to know is on Inland Revenue's residential property web page."


Visual:

A grey strip scrolls across the screen and a house flips up. The tenant walks back into the rental property. An orange circle with an 'equals' symbol (=) appears. The symbol is replaced with a 'less than' (<) symbol.

The words 'Weekly standard cost' appear above the house.

The 'less than' symbol is replaced with the words 'Income tax return', then a cross appears through it, indicating you won't need to file a tax return under the circumstances described.

The circle disappears and an Income tax return appears pops up out of the house. A balance sheet appears showing how to calculate your net income. The words 'Income – Expenses' give the balance of net income, shown by the dollar ($) symbol.

The balance sheet slides to the right and a calendar showing '31 March' appears, to show the end of the tax year. The date fades.

Audio:

"You won't need to pay tax on income from private boarders if the rent is equal to or below a certain amount (called the weekly standard cost). You won't need to file an income tax return if this is your only income."

"If your income is taxable, you'll need to keep a record of all your income and expenses so you can calculate your profit at the end of the tax year (that's the 31st of March for most people)."


Visual

An orange circle appears containing a shield, representing insurance. The shield is replaced by a dollar symbol to represent rates, then some work tools to represent repairs and maintenance.

The tools fade and a form and dollar symbol appear, showing how tax agents can help with the paperwork.

The circle fades and a dollar symbol appears, showing you can claim your accounting fees as an expense. The dollar symbol fades.

Audio:

"Examples of deductible expenses might be:

  • property insurance
  • rates or
  • repairs and maintenance."

"Many people ask a tax agent to help with the paperwork.  You can even claim your accounting fees as an expense."


Visual:

A room in the house is highlighted orange, then fades back to white. The income tax return moves upwards indicating it has been filed.

A teal-coloured calendar with the date '7 Jul' appears to show that is the date Inland Revenue requires most people to file their tax returns by.

Audio:

"If you're renting out a room, you can only claim a proportion of your household expenses."

"Once you've worked out your profit, file your income tax return with Inland Revenue by the due date.  This is normally the 7th of July."


Visual:

The screen fades to teal and the Inland Revenue logo appears. After a short time the web address www.ird.govt.nz/property appears under the Inland Revenue logo.

A short white strip slides up from the bottom of the screen and the New Zealand Government logo appears against the white background.

Audio:

"Our taxes help pay for essential important public services like hospitals and important social services - including the Canterbury rebuild. Please check our webpage, www.ird.govt.nz/property, to make sure you're paying your fair share."