Residential land withholding tax (RLWT)
New Zealand tax deducted from some residential property sales, paid by offshore RLWT persons who sell residential land where the bright-line test applies. The conveyancer or lawyer generally deducts it at settlement unless a valid certificate of exemption is held.
Residential land withholding tax (RLWT) is a withholding deducted from certain New Zealand residential property sales. It applies when an offshore RLWT person sells residential land and the sale falls within the bright-line period. The buyer’s payer — usually the seller’s conveyancer or lawyer — deducts the RLWT at the time of sale and pays it to Inland Revenue, unless the seller holds a valid certificate of exemption.
Inland Revenue treats a person as an offshore RLWT person under specific tests, broadly covering New Zealand citizens overseas continuously for three or more years, residence-visa holders overseas continuously for 12 or more months, and people without New Zealand citizenship or a residence-class visa. A company can be caught where more than 25% is offshore-owned or controlled, and a trust is tested on its settlors, trustees, and beneficiaries.
RLWT is a withholding rather than a final tax — it is credited against the income tax payable on the sale. The gain-based rate is 39% for individuals (from 1 April 2021), with the deducted amount capped relative to the sale price, so it interacts with the bright-line test, the main-home exclusion, and any carried-forward ring-fenced rental losses when modelling the tax on a sale.
Primary source
Inland Revenue (IRD) — Residential land withholding tax (RLWT) →Last reviewed 3 June 2026. Rates, thresholds, and deadlines change — always verify against the primary source before making decisions.
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