The sale or purchase of all land in New Zealand is now caught by new legislation as of 1 October, 2015.  In most cases, sellers and buyers must provide their lawyer with a completed and signed tax statement before possession of the land can be legally transferred.  

The completion of the tax statement requires the buyer and seller to provide a New Zealand IRD number which will create problems for those who do not have one and do not apply for one in time to meet the settlement date of the contract.  Most New Zealand residents will have a New Zealand IRD number but difficulties may arise where the buyer or seller is a trust, company, partnership, charitable trust or an “offshore person”.  Application for a New Zealand IRD number could cause delays to settlement, which in most cases, will result in costly penalties.  

Furthermore, for an “offshore person” to obtain a New Zealand IRD number, they must have a New Zealand bank account.  Obtaining a New Zealand bank account can be a lengthy process and this timing also needs to be taken into account when agreeing upon a settlement date for transfer of the property.  Due to the unpredictability of this time frame it is advisable that a New Zealand bank account and IRD number are secured in advance of a decision to purchase or sell property.  Be aware that “offshore persons” include New Zealand citizens who have not been living in New Zealand within the last 3 years and New Zealand residents who have not been living in New Zealand within the last 12 months.  Tax residents outside New Zealand will need to also provide their Tax Identification Number (TIN) from their country of residence.  Where overseas countries do not have TIN numbers, further time delays will need to be factored into the process to establish an acceptable TIN equivalent with New Zealand authorities. 

Which contracts are caught under this new legislation? 

This legislation applies to all property sale and purchase contracts including commercial property entered into on or after 1 October, 2015.  It also applies to all property sale and purchase contracts which settle on or after 1 April, 2016 (regardless of when the contract was entered into). 

Are there any exemptions? 

An individual purchasing or selling their main home is exempt from supplying their IRD number.  The main home exemption cannot be used for trusts, companies, partnerships, charitable trusts, “offshore persons” or persons selling their main home for the third time in a two year period.  

What will be required before settlement can occur? 

To enable settlement to proceed smoothly, advise your lawyer as soon as possible:

  •  If you are nominating another person or entity to complete the purchase (also advise your bank early who the nominees are if you require finance)
  • If you think there isn’t sufficient time between the unconditional date and the settlement date to set up a New Zealand bank account or produce a TIN (if applicable)
  • If you intend to instruct someone else (ie. your accountant or lawyer) to set up a New Zealand bank account and/or to obtain an IRD number
  • If you, the settlor, any of the trustees, beneficiaries, directors, shareholders or partners are based “offshore”
  • If you have sold your main home twice since 1 October 2015 


This article was prepared by Bryce Town, Partner, JB Morrison, Auckland.  If you require advice on this issue or any other property related matters please contact Bryce on 09 415 5475 or

This article provides an overview of the new legislation and should not be relied upon.  For advice specific to your situation please speak to someone in the property team at JB Morrison.