The Government this week pushed on with legislation requiring the disclosure of IRD numbers of property sellers unless exemptions are made.
The legislation is scheduled to come into effect from October 1.
Deloitte Dunedin tax partner Peter Truman said yesterday the focus of the Bill introduced to Parliament this week was on overseas buyers and sellers, New Zealanders who were undertaking property transactions where the property was not their main home and New Zealanders who had made at least two prior property transactions regarding their main home in the past two years.
Overseas buyers and sellers would not be able to buy or sell property unless they had a New Zealand IRD number, he said.
The changes were announced before last month's Budget as the Government tried to dampen the Auckland housing market.
To be issued a New Zealand IRD number, overseas buyers would also need to have a New Zealand bank account, Mr Truman said.
''This will ensure overseas parties are inside the New Zealand tax system so that rental income is taxed and the taxable gains on the sale of the property can be policed.''
There was also provision for the Inland Revenue commissioner to share the information collected with overseas tax authorities.
Anecdotal evidence suggested the IRD registration and information-sharing provisions was deterring some overseas investors from buying property in New Zealand, he said.
''This will serve to reduce some demand in the Auckland residential property market.''
The disclosure by New Zealanders of their details when undertaking property transactions would enable IRD to more easily scrutinise transactions which might be taxable under current legislation. Property traders should expect IRD to be more active in the future, Mr Truman said.
The Government was still consulting on the other property tax measures proposed in its pre-Budget announcement.
There were several key design features still needing to be determined for the property sales within the two-year bright-line test and also the withholding tax for non-residents.
Mr Truman expected an issues paper to be released in July and legislation for those matters to be introduced to Parliament in late August.
Revenue Minister Todd McClay said the new rules would not unfairly affect New Zealanders but would help enforce the ''reasonable expectation'' that anyone who was obliged to pay tax in relation to their property paid that tax.
