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Thread: Tax calc - taking home less than I am now, if I rent a house out

  1. #1
    Join Date
    Apr 2017
    Location
    new zealand
    Posts
    59

    Default Tax calc - taking home less than I am now, if I rent a house out

    Hi there,

    I've been using the mytax.co.nz website to try and figure out the amount I would take home, if I start getting a second income by renting an investment property out.

    I think I'm doing something wrong, but I don't know what, as the calculation page is simple and easy to use.

    So on top of my income from my fulltime job, if I add the pre-tax amount of $12,000 to my current income, the amount I take home DROPS below to what I'd take home if I didn't have the extra $12,000!?!

    I don't understand how this works?

    This initially started out as a "oh of course a second income from an investment property is worth it, but I'd like to find out how much tax I'd pay, to figure out what the overall return on my money will be".

    But based on the numbers I got from mytax, I'd take home $906 less each year, even though my income increased by $12,000, which is the rough estimate of the annual rent I'd get from the property.

    How on earth does that work? Any enlightenment much appreciated, as I'm getting very confused.

    Thanks very much for any advice!

  2. #2
    Join Date
    Jul 2006
    Location
    Dairy Flat, Auckland
    Posts
    1,770

    Default

    Try the government website and see if that makes a difference

    https://www.ird.govt.nz/topics/renta...and-paying-tax

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