Bright-line test
New Zealand tax rule that treats profit from selling residential property within a set holding period as taxable income. The period is 2 years for properties acquired on or after 1 July 2024.
The bright-line test is how Inland Revenue taxes short-term residential property gains in New Zealand. If you sell a residential property within the bright-line period that applies to your acquisition date, the profit is taxed as income at your marginal rate.
The period has changed several times: 10 years for properties acquired between 27 March 2021 and 30 June 2024 (5 years for new builds), and 2 years for properties acquired on or after 1 July 2024. The main home is generally excluded, and rollover relief can apply for some family transfers.
Bright-line is separate from the general land sale rules — a sale can still be taxable under those rules even if it falls outside the bright-line period.
Primary source
Inland Revenue (IRD) — Bright-line property rule →Last reviewed 15 April 2026. Rates, thresholds, and deadlines change — always verify against the primary source before making decisions.