Leasehold estate for first home withdrawal

Correction of an alteration to the KiwiSaver first home facility by removing 'leasehold estate' from the definition of 'estate'. Applies 1 Jul 2010 onwards.

Clause 8, schedule 1 of the KiwiSaver Act 2006

Changes have been made to correct an inadvertent alteration to the KiwiSaver first home facility.

Background

The Taxation (Annual Rates, Trans-Tasman Savings Portability, KiwiSaver, and Remedial Matters) Act 2010 altered the eligibility criteria for the KiwiSaver first home withdrawal provision, by removing "leasehold estate" from the definition of the word "estate" in clause 8(6), schedule 1 of the KiwiSaver Act 2006.

As explained in the November 2010 issue of the Tax Information Bulletin, the change was intended to allow a KiwiSaver member who had previously been party to a leasehold residential tenancy to meet the eligibility criteria for the first home withdrawal facility. However the amendment as drafted precludes a member who is purchasing a leasehold estate from accessing the first home withdrawal facility; this effect was not intended.

Key features

Clause 8, schedule 1 of the KiwiSaver Act 2006 has been further amended to ensure that a member who is purchasing a leasehold estate may access the KiwiSaver first home withdrawal facility.

Application date

The new rules apply from 1 July 2010, being the date of enactment of the previous amendment.