New Zealand


  • Service: Tax
  • Type: Business and industry issue
  • Date: 19/08/2011


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Taxmail - Mixed-use assets; herd scheme elections 

Issue 1, August 2011


Inland Revenue yesterday released issues papers on the tax treatment of mixed-use assets and herd scheme elections. 

The issues papers were announced in the Government’s 2011 Budget and the options proposed are aimed at “ensuring fairness in the tax system”.  They are available at

Mixed-use assets

The mixed-use assets proposals are targeted at holiday homes (and other assets, such as yachts, launches and aircraft) that are used both for income-producing and private activities. 


The suggested options would limit deductions for private use and periods the assets are unused.  The thresholds for full deductibility of expenditure have been set reasonably high. 

Herd scheme

The herd scheme proposal is in response to perceived unintended use of these rules.  The rules are seen as too flexible in allowing switching between livestock valuation methods.


Submissions on both issues papers are due by 30 September.  As always, there will be devil in the detail, which KPMG will be working through in the coming weeks.

Taxmail - Comment on topical tax issues from KPMG NZ Tax. 

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