Bright-line dates: which date counts when you buy and sell

A property deal has four dates, and each does a different job. The bright-line period starts when title is registered to you, usually your settlement day. It ends when you sign a binding agreement to sell, even a conditional one. The date you signed to buy matters only for older sales and the intention test, and settlement of your sale decides which tax year the profit goes in. Sign a sale agreement on the second anniversary itself and you are in territory the guides do not settle, so the cautious date is the day after.

The four dates in a property deal

Rules checked 10 November 2026. This is a guide, not tax advice; check with your accountant for your situation.

Inland Revenue's guide IR1229 sets out a standard purchase and sale as four events. Here is what each one does for tax:

For a sale agreed on or after 1 July 2024, the test is whether the end date is "within 2 years of" the start date, in the words of section CB 6A(1) of the Income Tax Act 2007. The acquisition date drops out of the period itself. The bright-line test explained covers the rule as a whole.

The start date: title registration, with exceptions

For a standard purchase, IR1229 says the bright-line period "starts from the date the transfer of the property's legal title is registered to you under the Land Transfer Act 2017 (usually the settlement date)." It is not the day you signed, the day the agreement went unconditional, or the day you got the keys, unless those happen to coincide with registration. Your lawyer's settlement statement and the title record show the date.

Some acquisitions use a different start date. IR1229's table, which follows section CB 6A(2):

Off the plans is the one that surprises buyers: the clock can start years before you own a finished home. Subdividing is the reverse: a new section keeps the start date of the land it came from. See our guides to new builds, subdividing land and rollover relief.

The end date: the sale agreement, not settlement

For a standard sale, IR1229 says the period ends "when you enter into a binding sale and purchase agreement to sell the property (even if some conditions like getting finance or a building report still need to be met)." A conditional agreement counts from the day it is signed. Settlement weeks later does not move it.

Other disposals have their own end dates. If more than one applies, the law says to use the earliest:

Gifts are treated as made at market value. IRD's example is Helen: title registered to her on 1 May 2025 at a cost of $400,000, and she registers a gift of the land to Ian on 1 February 2027, when it is worth $450,000. The end date is the registration of the gift, inside her 2 years, and $50,000 is taxable even though she received nothing.

Worked timeline: one purchase, four possible sale dates

Say you sign to buy a rental on 20 February 2025 and title is registered to you on 14 March 2025. Your start date is 14 March 2025, so the second anniversary is 14 March 2027. Here is what this site's engine says for four different sale agreement dates:

Two common mistakes show up in this example:

• Counting from the purchase agreement. Two years from 20 February 2025 is 20 February 2027. A seller who counts that way and signs on, say, 1 March 2027 thinks they are clear, but they are still inside the period that runs from title registration.
• Counting to settlement. A seller who signs on 1 March 2027 and settles in April may think the later date gets them out. It does not: the agreement date is what counts.

Our bright-line end date finder does this for your own start date and gives the first clear day.

The anniversary-day edge case

What if you sign the sale agreement exactly two years after title registration, on the anniversary itself? The honest answer is that we could not find it settled:

• Section CB 6A(1) uses the words "within 2 years of", without saying whether the anniversary day is inside or outside.
• IR1229 and IR1227 do not address that day directly.
• The nearest pointer is IR1229's co-ownership example, which says a share with a start date of 31 July 2023 is "taxable if sold before 31 July 2025." Read literally, that treats the anniversary as outside the period.

Our calculators follow that example: a sale agreement before the anniversary is inside, and the anniversary day itself is shown with a warning. For the timeline above, the end date finder gives 15 March 2027 as the first date that is clear on any reading. If your sale is close to the line, the cautious course is to sign on or after the day after the anniversary, and to check with your accountant before signing on the day itself.

Two smaller points on counting:

• 29 February. If title registered on 29 February 2024, there is no 29 February in 2026. Our engine treats 1 March 2026 as the anniversary, the later of the two possible days. This is our assumption, not an IRD statement.
• Time of day does not matter. The tests use dates, so signing late in the evening on the anniversary is still the anniversary.

Which tax year the profit falls in

The sale agreement decides whether the sale is caught. Settlement decides when it is taxed: IR1229 says "Usually, the date of settlement will determine the income year the income should be included." New Zealand's income year runs from 1 April to 31 March.

One day's difference in settlement moves the profit into a different year, which can change the rate it is taxed at if your other income differs between years. With a tax agent and an extension of time, the IR3 is due by 31 March of the following year instead. Our guide to selling a rental covers the filing steps, and how the gain is taxed covers the rates.

IRD's own date examples

IR1229 works through several timelines. We have checked each against this site's engine:

Denise shows the off-the-plans rule at work: measured from her title registration she would also be inside, but the start date is the earlier agreement date. Bob shows that subdividing does not restart the clock. If you are unsure which row fits you, the is my gain taxable checker asks the questions in order.

Questions people ask

Does the bright-line period start when I sign to buy or when I settle?

For a standard purchase it starts when title is registered to you, which is usually your settlement day. Off-the-plans purchases are the main exception: they start on the agreement date.

Does a conditional sale agreement count as the end date?

Yes. The end date is the day you enter a binding sale and purchase agreement, even if conditions such as finance or a building report are still to be met.

Is a sale signed exactly on the second anniversary inside the bright-line period?

The law and IRD's guides do not settle it directly. IRD's co-ownership example says "taxable if sold before" the anniversary, but the cautious course is to sign on the day after.

Which tax year does a bright-line profit go in?

Usually the income year in which the sale settles. A sale settling on 31 March 2027 is 2026/27; one settling on 1 April 2027 is 2027/28.