New Zealand levies a goods and services tax (GST) on the supply of most goods and services in the country, including imports. The standard rate of GST is 15%. Certain supplies are taxed at a reduced rate of 9% whilst certain supplies are either zero-rated or exempt.

Reduced Rate of 9% Supplies Include:

Supplies of accommodation and other domestic goods and services in a nursing home; and
Long-term hotel accommodation.

Zero-Rated Supplies Include:

Export of goods and services;
Sale of a business as a going concern; and
Services performed outside New Zealand.

Exempt Supplies Include:

Financial services;
Life insurance and reinsurance;
Certain real estate transactions; and
Precious metals.

Registration Threshold

Entities are required to register for GST if the taxable turnover is or exceeds the threshold of NZD 60,000 in the previous 12 months or if the threshold is expected to be met within the next 12 months. Voluntary registration is allowed when the threshold is not met.

Group Registration

Group registration is allowed for companies or other taxable persons that are under ‘common control’. Companies are considered to be under ‘common control’ if the companies in the group are at least 66% commonly owned in terms of voting interests or market value interests.

Other taxable persons may form a group if any of the following control conditions are satisfied:

All members of the group are controlled by one person (outside the group);
One member of the group controls all other members of the group; or
Two or more persons, carrying on a taxable activity in partnership, control the members of the group.

Returns and Payments

Taxpayers are required to submit GST returns and make corresponding tax payments either on a monthly, bimonthly, or six-monthly basis depending on the annual taxable turnover. Taxpayers with annual taxable turnover exceeding NZD 24 million are required to file monthly returns. Taxpayers with annual taxable turnover between NZD 500,000 and 24 million are required to file returns on a bimonthly basis and taxpayers with an annual turnover of less than NZD 500,000 are required to file returns on a six-monthly basis. GST return and tax payments are due on the 28th day of the month following the end of the return period, except for the periods ending 30 November and 31 March. The due dates for these periods are 15 January and 7 May, respectively.

Market Place Rules for Listed Services

Effective 1 April 2024, online marketplace operators facilitating the sale of 'listed services' are required to collect the GST at the standard rate when the service is performed, provided, or received in New Zealand. This will apply whether the supplier is GST-registered or not. Thus, the underlying supplier (person supplying listed services through electronic marketplace) is not responsible for collecting GST and is required to include the sales made through the electronic marketplace in the GST returns as zero-rated supplies. They can claim input GST on the costs of making supplies of listed services.

Listed services include:

Ride-sharing and ride-hailing;
Food and beverage delivery; and
Accommodation such as short-stay and visitor accommodation. (Accommodation used by the customer as their principal place of residence is exempt.)

GST also applies to closely connected services if they are facilitated through the marketplace operator. For example, holiday rental cleaning fees charged on top of the accommodation costs.

The non-GST registered marketplace operators are required to register for GST if the registration threshold is met.

As per the transitional provisions, underlying suppliers and electronic marketplace operators are not required to account for GST on contracts for taxable accommodation entered into before 1 April 2024, provided certain requirements are met.

GST Flat Rate Credit Scheme

From 1 April 2024, a new GST flat rate credit scheme applies for suppliers who are not GST-registered.

The marketplace operators are required to collect GST at the standard rate on listed services that are performed, provided or received in New Zealand. They will then pass on 8.5% to suppliers who are not GST-registered. The remaining 6.5% is paid to the tax authority.

The 8.5% passed on to unregistered supplies recognises the GST on their costs from supplying listed services.

In order to use the flat rate credit scheme, the marketplace operators are required to identify suppliers that are GST-registered from those who are not. Marketplace operators are required to inform suppliers of the total amount of flat-rate credit they have passed on to them at least once a month.

Opt-Out Rules for Large GST-Registered Suppliers

Some underlying suppliers can choose to opt-out of the above marketplace rules and remain responsible for their GST obligations. Underlying suppliers that opt-out of the marketplace rules include the supplies of listed services made through an electronic marketplace in their GST returns as standard-rated supplies.

In order to opt-out, the supplier is required to:

Make more than NZD 500,000 of supplies in a 12-month period
Provide accommodation and meet the 2,000-night threshold, based on the number of nights of accommodation listed through a single online marketplace.

Suppliers making more than NZD 500,000 supplies in a 12-month period can notify their marketplace operator that they are opting out. Accommodation providers are required to enter into an agreement with their marketplace operator to opt-out of the rules if they meet the criteria.

However, hostels and motels registered for GST on or before 1 April 2024, exceeding the GST registration threshold, and making supplies both through an electronic marketplace and directly to recipients of accommodation services can choose to opt-out of the above marketplace rules (irrespective of satisfying the above statutory opt-out thresholds).

Such suppliers of accommodation services can opt-out of the marketplace rules for taxable periods starting on or after 1 April 2024 and ending on or before 31 March 2025.

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