The Government is moving to clarify the law to give tax exemptions to agencies which help low income families into home ownership.
Housing Minister Nick Smith said on Tuesday a tax change will assist groups such as Habitat for Humanity running rent-to-buy or similar schemes.
The Charities Commission has ruled that that while assisting low-income people with renting a house is charitable, assisting people into home ownership is not.
Dr Smith said that left trusts working in the community housing sector anxious and uncertain about their tax status.
He said new legislation will be introduced to Parliament to provide certainty that assisting low-income families into home ownership, will be exempt from income tax.
The changes will also enable people to claim tax on donations to community housing providers.