Buying guide
Interest deductibility on rental property explained
The laws are changing so we’ve got up to date answers to make life easier.
AI summary
The NZ government is reintroducing interest deductibility for rental properties, reversing the previous phase-out policy. This allows landlords to deduct mortgage interest costs from their rental income.
The change is being phased in:
- 2023/24: 60% deductible
- 2024/25: 80% deductible
- 2025/26: 100% deductible
Additionally, the bright-line test has been shortened to two years. Landlords should consult a tax accountant to navigate these updates and ensure they are compliant with the new rules.
But first, what is interest deductibility on rental property?
Current rules — what's deductible now?
There are tax advantages to owning a new build property.
Other changes for investors to note
Should I be doing anything now?
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