GST
Goods and services tax (GST) is a tax on most goods and services in New Zealand, most imported goods, and certain imported services. GST is added to the price of taxable goods and services at a rate of 15%.
What are taxable goods and services?
Goods include all types of personal and real property, except money.
Services covers everything other than goods or money, eg TV repairs, doctor’s services and gardening services.
Taxable goods and services are part of the business or taxable activity. This means you supply or receive taxable goods and services for a consideration (money, compensation, reward) but not necessarily for profit. The Inland Revenue refer to taxable goods and services as “taxable supplies”.
Taxable goods and services don’t include:
- goods and services supplied by businesses that aren’t registered for GST, and
- exempt supplies such as:
letting or renting a dwelling for use as a private home
interest you receive
certain financial services.
GST is a tax that you collect on behalf of the government. You charge GST in your sales and income and claim it back for your purchases and expenses. You then calculate the difference in your GST return to work out if you have to make a GST payment to the Inland Revenue or if your receive a GST refund from the Inland Revenue.
Here’s how to calculate your GST:
- You charge GST at 15% for sales and income.
Calculate GST by multiplying the sales and the income figure by 3 then dividing by 23.
- You claim GST at 15% for purchases and expenses.
Calculate GST by multiplying the purchases and expenses figure by 3 then dividing by 23.
