For most merchants, this will actually result in an increased number of shipments that will clear duty and tax-free. TSI needs to include the date of the invoice, or if invoice is not issued, the “time of supply”. For GST purposes, an invoice is a document notifying the obligation to pay. https://accountingcoaching.online/ Please note the comments above are for ordinary transactions subject to GST. Different rules may apply to imported goods or services, or acquisitions from non-GST registered person. There could be other practical implications as a result of the new GST invoicing rules being implemented.
The IVL is said to be “a way for travellers to contribute directly to the tourism infrastructure they use and to help protect and enhance the natural environment”. It is crucial to keep accurate records of your receipts and invoices. When you register with the IRD, you need to regularly file a return. But before you do so, you need to make sure that you have calculated everything correctly.
You will be asked to enter your BIC (business industry classification) code when you register. This article was reviewed and published by Robin, capitalize definition & meaning the co-founder of NZ Pocket Guide. He has lived, worked and travelled across 16 different countries before calling New Zealand home.
How to Send Money from Australia to New Zealand (& Vice Versa)
When you are registered you add GST to your prices and pass the GST on to us. If you regularly sell goods or services you might need to charge GST to your customers. 2.22 The legislation also required an inquiry by the Australian Productivity Commission on the effectiveness of the rules and other possible models for collecting GST on low-value imported goods. The Australian Productivity Commission completed its inquiry on 31 October 2017 and concluded that the legislated model was the most feasible option at the present time. 2.14 Furthermore, the growth of the online shopping market means the amount of GST not being collected on low-value goods supplied from offshore, but consumed in New Zealand, is increasing. Travellers departing on airlines or private craft are charged a Customs levy of NZ$4.52.
You pay a 15% goods and services tax (GST) on most of your purchases in New Zealand. Your GST return is due by the 28th of the month after the end of your taxable period. When determining if you meet the threshold, do not include supplies sold to New Zealand businesses or goods that are each valued over 1,000 NZD. A) No change if your tax invoice shows the GST exclusive amount, GST amount and the gross amount for the supply. The table below compares the required content of a tax invoice to the information required for TSI. Even if you are not required to make any changes, you should still be aware of these additional options as your suppliers’ invoicing practices may be changing, which could impact the way you operate your business.
Digital Platforms and GST—Significant New Zealand Developments
2.17 Since then, further work has been undertaken by officials using a mixed dataset that includes Customs’ sample data of goods coming across the border. An estimate was calculated based on an assessment of the value of goods under the current de minimis. This work conservatively estimates that the foregone GST revenue for the 2016 calendar year was around $80 million.
- Duty and GST on high-value goods will be collected at the border or, for simplicity and if you meet certain requirements, you may elect to collect and remit GST on all goods (low and high value).
- For most merchants, this will actually result in an increased number of shipments that will clear duty and tax-free.
- Melissa is required to pay GST and tariff duty on the running shoes.
- For some special supplies, such as secondhand goods, you may still be able to claim a GST adjustment.
- The table below compares the required content of a tax invoice to the information required for TSI.
Please contact our KPMG GST specialist team if you need further guidance. A new bill proposes significant changes to the goods and services tax treatment of the gig and sharing economy in New Zealand. Eugen Trombitas of PwC NZ looks at the details and some practical issues to note.
Buying from non-registered suppliers
The proposed rules, therefore, are broadly in line with New Zealand’s current rules for collecting GST on cross-border services and intangibles, and the recently enacted rules for low-value imported goods in Australia. Apparel attracts a ten percent tariff duty where New Zealand does not have a free trade agreement with the country of the goods’ origin. Since the duty on the clothing is only $26.50 (comprising tariff duty of $10 ($100 x 10%) and $16.50 of GST ($110 x 15%), Melissa’s purchase is below the current de minimis threshold. She is not required to pay any duties to Customs on the active wear she purchases from offshore. 2.2 Conversely, goods and services that are exported (and therefore consumed offshore) are generally untaxed. Under the GST rules, exports are zero-rated, meaning GST is charged at a rate of zero percent and businesses can claim the GST back on the cost of their inputs.
A New Zealand Tax Guide for Travellers
Allowing exporters to claim back GST on their inputs ensures that GST is not a cost on businesses or offshore consumers. When GST is collected on low-value goods to a New Zealand business, you can choose to refund the New Zealand business for the GST amount collected or you can send them a full tax invoice. The New Zealand business can use the tax invoice to claim a GST deduction on their GST return for orders valued less than 1,000 NZD. Any orders with goods valued over 1,000 NZD to a GST-registered business will need to be issued a refund.
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. If your business exceeds the 60,000 NZD threshold, then you will be required to register for, collect, and remit GST directly to New Zealand on all low-value goods. Duty and GST on high-value goods will be collected at the border or, for simplicity and if you meet certain requirements, you may elect to collect and remit GST on all goods (low and high value).
If you run a business in New Zealand, you may need to collect Goods and Services Tax (GST) from your customers. This is the case regardless of whether you operate your business as a sole trader, contractor, partnership or company. This is usually 15%, however, it may be “zero-rated” at 0% in certain circumstances.
Because businesses claim back their input GST, the GST inclusive price is usually irrelevant for business purchasing decisions, other than in relation to cash flow issues. Consequently, wholesalers often state prices exclusive of GST, but must collect the full, GST-inclusive price when they make the sale and account to the IRD for the GST so collected. When a package is entering New Zealand, customs officials will need to clearly understand which items GST has already been collected on.
2.4 GST on imported goods is currently collected by Customs at the border. However, GST is not collected if the total duty value (including GST, tariffs and other duties) is less than $60. Visa-waiver countries for New Zealand are listed in What You Need to Know About the New Zealand ETA & Visitor Levy. Your taxable period (also known as filing frequency) refers to how often you need to file your GST returns with IRD.
2.12 The current policy settings place domestic suppliers of goods at a competitive disadvantage compared with offshore suppliers that are able to transport low-value goods directly to their customers without the imposition of GST. This is having the greatest impact on domestic sellers that provide goods that are similar to goods sold from offshore (or substitutable products). 2.3 New Zealand’s GST system is regarded throughout the world as a model consumption tax.