New Zealand GST rates and GST compliance

Almost all of the time, businesses will include GST in the price displayed. However, some businesses will write a price and mention “+ GST” which means that you should add the GST to that price to know how much building maintenance definition the price is in total. This is pretty rare but still happens in some trade, wholesale retailers and services, so keep an eye out. You collect GST from your customers on the sale of your goods or services.

In the first week, Susan worked for $80 + GST per hour, for 30 hours. In the second week, Susan worked for $95 + GST per hour, for 35 hours. In the third week, she worked for $85 + GST per hour for 40 hours, and in the last week, she worked for $90 + GST for 20 hours.

When do I file my GST return?

A range of penalties can be imposed where businesses do not comply with the GST legislation. Time of supply arises at the earlier of an invoice being issued or payment being received. However, there are some disadvantages and any decision on whether to group register should be carefully considered. For example, all GST group members (including former members) are jointly and severally liable for the GST debt of the group during the period of their membership. Basically, a record of all the buying and selling must be kept meticulously during the GST periods so any inconsistencies and tax irregularities can be avoided.

• Therefore we suggest you give us a quick call so we can point you in the right direction with the cheapest, fastest means of getting the right result.
• For many Australian-controlled businesses, having a New Zealand-registered tax agent to prepare and lodge the GST returns will ensure that you don’t fall for the many differences that apply to the different regimes.
• There are three types of filing frequency in New Zealand, and the options available are monthly, two-monthly, or six-monthly.
• Travellers departing on a cruise ship are charged a Customs levy of NZ$4.55.
• The Goods and Services Tax (GST) is a value-added tax in New Zealand that is applied to most goods and services at a rate of 15%.
• Getting things are set up correctly for New Zealand GST in the first place is always the cheapest way to go.

For GST purposes, you have an option of filing your GST returns monthly, 2-monthly or 6-monthly. The category was introduced to encourage overseas businesses who have no connection with New Zealand, to consider New Zealand as an attractive destination to hold a conference or something similar. So that the GST content was not a deterrent as a cost factor, the New Zealand government decided to allow a refund in these circumstances. With Deskera, you can easily apply the New Zealand GST tax rates to your transactions and generate a proper sales invoice. You can only file using your myIR account or manual filing if you are using the ratio option to compute your provisional tax. Once you have your account set-up, you can make payment anytime, anywhere.

If you are required to register for GST and fail to do so, you may be liable for penalties and interest on any GST that should have been paid. © 2024 Grant Thornton International Ltd (GTIL) – All rights reserved. For example, a non-resident who only exports goods to a New Zealand wholesaler would not be able to register for GST if the goods are outside of the country when an invoice is issued or any payment is received. However, the ability for a non-resident to GST register has been expanded (further information can be found below). This is referred to as the provision of ‘business to business’ financial services.

If you’re GST registered, remember to include GST in your prices or you could be out of pocket.

Some goods and services have GST charged at 0% — these are called zero-rated supplies and are typically provided to people overseas. Zero-rated goods and services include products or services from New Zealand that are sold overseas, eg exports or some land transactions. The Goods and Services Tax (GST) in New Zealand is a tax set at a 15% rate by the government of New Zealand.

In most cases we are able to help clients avoid the difficult parts of the process and have their New Zealand GST registration completed within a matter of days. No one gets NZ GST registrations for Australian-controlled businesses faster than us. Also, you can specify your customers’ location and charge the correct tax rate using the tax configuration feature in the system.

OK, It’s Time To Register For GST – What’s Next?

In the GST return form, all records must be present along with the documentation. Even where things have gone wrong, we may be able to negotiate reductions in shortfall penalties. You should note that New Zealand has one of the most aggressive tax penalty regimes in the world so seeking professional advice when first notified of any kind of GST review is in your best interests. If you have been selected for a New Zealand GST Audit, investigation or review we can advise and represent you with Inland Revenue. If things have been done correctly, we can often expedite the payment of a GST refund.

What is the GST?

This example demonstrates how a business that makes sales but does not receive payment in a given month can still account for GST paid on expenses incurred during that period. Yes, although non-resident businesses are only able to register for GST in New Zealand if their taxable supplies are generated when the time of supply occurs within New Zealand. Exceptions to this are noted elsewhere in this summary (eg remote sellers of goods and services). A person can register on a voluntary basis even if the registration limit has not been reached. The remote seller GST regime minimizes compliance issues (eg no tax invoices are required to be issued).

You are Joe’s regular customer, and you have purchased a pair of sneakers at $74.75 in total (the price is GST-inclusive). During the GST registration process, you are required to fill in the business industry classification code (BIC). Plus, for more information on work taxes, check out our guide to the New Zealand Work Tax System. Travellers departing on a cruise ship are charged a Customs levy of NZ$4.55.

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And New Zealand banks are being very hesitant in opening up a bank account for non-residents because of the background checking they are required to do under that legislation. The alternative is that your freight forwarder may be collecting the New Zealand GST from you. If you aren’t properly registered then that 15% is simply a cost to you and come straight out of your margin. Under this provision you will have no ability to claim back any New Zealand GST. You simply charge your New Zealand customers and pass that on to Inland Revenue on a quarterly basis.

Digital services supplied by offshore companies

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. We get a lot of enquiries from Australian businesses looking to claim a GST refund as a result of shipping product through New Zealand which has been subject to GST charged by New Zealand Customs. Here at GST Portal we want to simplify your needs when it comes to Goods and Service Tax. Since the change in the New Zealand GST tax rate we have been providing advice on GST to people around New Zealand and businesses around the world. One of our other services can be viewed at GSTCalculator.co.nz which is the number one website in New…

GST does not need to be charged if the service is provided to a New Zealand GST – registered businesses unless the supplier and recipient agree otherwise, in which case the supply will be zero-rated. Non-resident remote service providers must file their GST returns quarterly. If that applies to you then you will need to register under a special provision of the New Zealand GST legislation that categorises you as a GST tax collector.