New Zealand Goods and services tax GST Rates

In New Zealand, foreign businesses are expected to file tax returns every quarter. You have 28 days to file and pay after the end of each period. Zero-rated goods and services include products or services from New Zealand that are sold overseas, e.g. exports or some land transactions. Even though your business may pay GST on items, or add GST onto your own goods and services, you may qualify for GST credits for some transactions. Charging and collecting tax is only the first half of staying compliant. The second, and equally important, half is filing returns and paying whatever you might owe to the government.

Fill out the return details

Tax identification numbers can be verified with the Inland Revenue, and will follow a certain format. The GST registration number format is Taxable persons use tax registration numbers (IRD number) for GST purposes in the format xx-xxx-xxx; effective from 2008, nine-digit numbers are issued to new GST-registered persons. You might need to register for GST if you sell goods or services. Once you’re registered for taxes, you’re expected to charge 15% GST on every sale to a New Zealander resident. New Zealand’s consumption tax is called the Goods and services tax (GST),which was introduced in October 1986. You will need to charge GST on your supplies of goods and services and pay it to Inland Revenue.

Goods and services tax (GST) is New Zealand’s consumption tax. 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. But once your ace the investment banking interview financial statements question local sales do surpass NZD 60,000, then you may have to register for VAT and comply with all of the New Zealander rules around tax rate and collection, invoices, and filing returns. GST is the consumption tax throughout New Zealand, levied on almost everything sold in the country. There are specific rules around digital products, which you must follow closely to stay tax compliant.

GST rate

Just follow our instructions on how to register for GST capital budgeting in New Zealand. This guide breaks down how to write a business plan and what you need to think about to make your business plan as persuasive as possible. You can find more information about which items are GST-free here. With GST being applied to so many goods, most New Zealand small businesses will likely have some GST obligations.

1. You will also be able to claim back the GST you incur on your business expenses.
2. Even though your business may pay GST on items, or add GST onto your own goods and services, you may qualify for GST credits for some transactions.
3. As a GST-registered business, issuing tax invoices, collecting GST from customers and sending information to IR can be a bit of a handful.
4. That new piece of GST legislation mirrors similar rules governing the supply of digital services introduced in the European Union (EU) in January 2015 on the taxation of digital goods.

New Zealand GST registration number format

Zero-rated supplies still have to be recorded on your GST returns. There are certain items and categories that are exempt from GST — we call them zero-rated goods and services. GST credits are a way to claim back some of the GST that you’ve paid and redirect that money back into your own business — more on this later, though. When you are registered you add GST to your prices and pass the GST on to us. If you need to, you can attach correspondence or receipts to the return before you submit it.

If your customer is a fellow business, and they’ve provided a valid GST number, then adding and collecting tax isn’t necessary! The buyer will handle tax, via New Zealand’s reverse-charge mechanism. A digital product is any product that’s stored, delivered, and used in an electronic format. These are goods or services that the customer receives via email, by downloading them from the Internet, or through logging into a website. These are the revenue thresholds at which businesses in New Zealand are required to start collecting and remitting tax. Businesses in New Zealand that are required to collect tax will be issued an identification number.

Many countries allow tourists, and others making purchases for export, to receive a VAT refund on exiting the country (or make purchases VAT free). While we don’t have data on the New Zealand VAT refund program, more info can be obtained from the Inland Revenue. Most New Zealanders will immediately recognise the Goods and Services Tax (GST) as the 15 percent tax slapped onto most goods and services provided in New Zealand. Discover how to register, calculate and report on the Goods and Services Tax (GST) and how the GST might affect you personally, particularly as a small business owner.

If you’re unsure about whether your business needs to total budgeted cost definition register, you can contact us or your tax agent. Find out more about low value imported goods or what to do if you get charged GST twice. Submit your return and make any required payment by the due date. If your accounting software allows you to file your return directly with us, you can do this.