Does your Family Trust have an IRD number?

If you have a family home in a trust, changes proposed under the Taxation (Land Information and Offshore Persons Information) Bill will more than likely require your family trust to register for an IRD number.

From 1 October 2015, anyone buying or selling property will need an IRD number. This includes non-income generating family trusts that own the main family home. Resident IRD applications must be posted to the IRD and the IRD has advised an 8 – 10 day processing time. However, the processing time may well increase as the volume of applications grow?

Therefore anyone considering buying or selling a property through a trust is advised to apply for an IRD number well in advance of the transaction taking place. If the IRD number is not available at the time of settlement, interest and penalties could be imposed under the sale and purchase agreement.

Non-residents who own property in New Zealand will also be required to have an IRD number. Whilst a non-resident application can be emailed to the IRD, there is a further requirement to have a New Zealand bank account included in the application and the time taken to open an account and satisfy anti-money laundering requirements can take several weeks.

We therefore strongly advise trustees of family trusts and non-resident property owners whom are considering a property purchase or sale to apply for an IRD number after 1 October 2015.

Please call your GECA adviser on 0800 758 766 if you would like us to file an IRD number application on your behalf or if you would like further advice in regard to your personal circumstances.