GST goods and services tax
Almost all of the time, businesses will include GST in the price displayed, which we’ve experienced throughout the 10 years we’ve lived here. However, some businesses will write a price and mention “+ GST,” which means that you should add the GST to that price to determine the total price. This is pretty rare but still happens in some trade and wholesale retailers and services, so distinguish between tangible and intangible assets keep an eye out. The GST rate is 15% which is applied to all goods and services.
Non-resident businesses and GST
It is a tax for people who buy and sell goods and services. You might need to register for GST if you sell goods or services. If you’re a non-resident business that sells low value goods such as clothing, cosmetics and electronic items to consumers in New Zealand, you may need to register for, collect and return GST.
- This happens when the GST paid on eligible expenses is greater than the GST collected from sales.
- Your GST return is due by the 28th of the month after the end of your taxable period.
- You can read about when a non-resident is deemed to make a taxable supply in New Zealand in section 8(2) to (4) of the Goods and Services Tax Act 1985.
- With GST, there are things called ‘zero-rated supplies’, which aren’t subject to GST.
- In these cases, it’s worth checking out the IRD page on special supplies.
When GST is due and a business need to file and pay the 15% tax, the following documents and procedure can be followed depending on each company, business type, and amount of revenue generated. First of all, businesses must bear in mind how GST is calculated i.e., documentation that shows transaction details during a GST period and have everything ready by GST return dates. If you provide a listed service such as ride-sharing and ride-hailing, food and beverage delivery, or short-stay and visitor accommodation there are changes from 1 April 2024. Online marketplace operators (resident or non-resident for tax purposes), who provide listed services, must collect and return GST of 15% when the service is performed, provided, or received in New Zealand. This will apply whether the seller is GST-registered or not.
Fill out the return details
In simple words, in any taxable activity, a business pays as well as collects GST during various transactions and should keep a record of these for GST returns. GST can be filed on a monthly basis, two-monthly basis, or six months basis and to account for sales and purchases payment receipts, invoices and a mix of the two can be used. GST New Zealand can be filed at the inland revenue department either using a paper form, via an online portal, or accounting software. GST stands for Goods and Services Tax (GST) and as per the GST New Zealand rules and regulations since 2010, fifteen percent (15%) is added to goods and services as tax.
Is GST Always Included in the Price in New Zealand?
As per the regulations, any business, trade, and company selling and buying goods and services must be registered for GST in New Zealand. It is applicable if and when the revenue of a business or company in the previous 12 months is $60,000 or the anticipated revenue is $60,000. Generally, the displayed price on products and services in New Zealand is GST inclusive i.e., a 15% tax is added to the product price.
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Once you’ve logged in to myIR, you need to select the option within your profile to ‘Register for a new tax account’. You’ll also have to enter a BIC (business industry classification) code. It means they can claim GST on materials and services they use for their business. If you decide to go this way, you need to be aware that your prices to customers must include GST. Also, you are obligated to do GST returns on time, every time. You will need to charge GST on your supplies of goods and services and pay it to Inland Revenue.
It is usually charged at a rate of 15% by GST-registered persons and is added to the price of most goods and services supplied in New Zealand, including most imported goods and services. These are the taxes you might be expected to pay as a tourist or international visitor to New Zealand, which we will go into more detail about in this New Zealand tax guide for travellers. Different countries have different names for this good and service tax like GST and VAT Value Added Tax and the percentage of the tax varies. The purpose is to regulate the market and free trade and ensures standard procedures are followed in business transactions. It is a form of indirect tax that the government collects via the sale of goods and services that businesses impose and give to the government.