be available taxpayer’s to both buyer final income and seller, as tax liability - well as their particularly as respective the bright-line conveyancing test (and thus agents the RLWT) is thereby targeted at reducing short-term compliance speculation. costs. Where the seller has made a loss on the sales price, RLWT would be withheld even though there is no tax liability. Would require more refunds to be issued. Recommendation: not recommended. The amount There may be withheld instances would be where the more in seller’s with the acquisition taxpayer’s price is not final income available, in tax liability. which case, Relatively 33% x seller’s simple to gain becomes calculate - 33% x total seller’s sales price and 33% of acquisition there would be seller’s gain price over-taxation. generally Over-taxation sales price available would also - seller’s from occur where acquisition Quotable the seller has a price) Value. No number of RLWT to be deductions withheld available (for when the example, seller has where the made a loss seller has made on the sales a number of price. capital improvements) Recommendation: not recommended. The amount There would withheld still be some would be instances of more in line over-taxation “Lower with the where the of” taxpayer’s seller has a approach final income number of tax liability, deductions but there is a available. back stop
be available to both buyer and seller, as well as their respective conveyancing agents thereby reducing compliance costs. taxpayer’s final income tax liability - particularly as the bright-line test (and thus the RLWT) is targeted at short-term speculation. Where the seller has made a loss on the sales price, RLWT would be withheld even though there is no tax liability. Would require more refunds to be issued. Recommendation: not recommended. 33% of seller’s gain sales price - seller’s acquisition price) The amount withheld would be more in with the taxpayer’s final income tax liability. Relatively simple to calculate - seller’s acquisition price generally available from Quotable Value. No RLWT to be withheld when the seller has made a loss on the sales price. There may be instances where the seller’s acquisition price is not available, in which case, 33% x seller’s gain becomes 33% x total sales price and there would be over-taxation. Over-taxation would also occur where the seller has a number of deductions available (for example, where the seller has made a number of capital improvements) Recommendation: not recommended. “Lower of” approach The amount withheld would be more in line with the taxpayer’s final income tax liability, but there is a back stop There would still be some instances of over-taxation where the seller has a number of deductions available.
2015-ris-rlwtgstossl-bill-3.docx