The Brightline property rule applies to properties purchased after 1 October 2015. It looks into what period the property was acquired and when it is being sold. If the property is sold after owning it for less than ten years, you may be obliged to pay income tax. The date that the land of the purchased property is transferred to you is the date the brightline period begins, and this date determines whether the 2, 5 or 10 year brightline period applies, which subsequently determines which rules you are subject to. The brightline period ends the day you enter into a binding sale and purchase agreement to sell the property. The exclusions to this rule are property considered to be your main home, inherited property or if you are the executor or administrator of a deceased estate. Roll over relief is applicable to relationship property settlements and amalgamations, with full relief for transfers on death. The recently enforced rollover relief allows for the owners of a property to change how the property is held, without triggering the brightline property rule. This also applies to certain transfers to family trusts and transfers to or from look-through companies and partnerships, Māori authorities and as part of a settlement claim under the Treaty of Waitangi. Rollover relief will only apply if the amount received on transfer equates to or is less than the original acquisition cost to the owner. Where a larger amount is received, no relief will be awarded, however the original owner will be taxed based on this amount if this differs to the market value of the property. The rollover relief rules apply to property that is sold on or after 1 April 2022, regardless of whether the original date of the property being acquired was before the introduction of the brightline property rule. It is important to note that the rollover relief does not provide an exemption to the brightline property rule. Essentially it is relief of income tax when a property is transferred, as it is ignored. In this instance, taxation is deferred until later disposal. Once the property is sold or disposed of later on, the date that the original owner acquired the property will be used as the beginning date for the brightline period, which will help determine which brightline period to apply. Rollover relief is now in action as of 1 April 2022.